Risk of Loss/Conditions

Question 1

1st Step in a Risk of loss problem

Answer 1

Whether the parties have already dealt with the risk of loss in their contract

Question 2

2nd step in a risk of loss problem

Answer 2

Did a party breach the contract ? If so that bears the risk of loss

Question 3

3rd step, are the good being shipped ?

Answer 3

Shipment Contract (FOB sellers place)= Risk of loss is on buyer once goods are given to carrier

Destination contract (FOB buyers place) = Risk of loss in on seller until goods get to location

Question 4

None apply ? 4th step, Is the seller a merchant

Answer 4

If yes, risk of loss stays with seller until buyer picks up the goods

If no, risk of loss moves to buyer once seller tends the goods

Question 5

Seller’s Insurable Interest

Answer 5

A seller has an insurable interest as long as she has title or a security interest

Question 6

Buyers insurable interest

Answer 6

A buyer has an insurable interest as goods as the goods are specifically identified.

Question 7

Condition precedent

Answer 7

Event occurs Triggers an obligation

Question 8

Condition concurrent

Answer 8

Event occurs at the time of pefromane

Question 9

Condition subsequent

Answer 9

Event that occurs that suspends an obligation

Question 10

Waiver of Conditions

Answer 10

1. A party protected by a condition can expressly waive it
2. A party protected by a condition who later acts in bad faith with respect to the condition will “waive it”