BLAW Ch. 20 The formation of Sales and lease contracts – Flashcards
Unlock all answers in this set
Unlock answersquestion
Sales contracts
answer
Contracts for the sale of goods
question
Sale
answer
The passing of title from the seller to the buyer for a price
question
Tangible property
answer
Property that has physical existence-can be touched or seen
question
Intangible property
answer
Corporate stocks, bonds, patents and copyrights-has conceptual existence
question
Predominant-factor test
answer
Used when contracts involve a combination of goods and services. If a court decides that a mixed contract is primarily a goods contract, any dispute will be decided under the UCC
question
Merchant
answer
1. A person who deals in goods of the kind involved in the sales contract 2. A person who, by occupation, holds himself or herself out as having knowledge and skill unique to the practices or goods involved in the transaction 3. A person who employs a merchant as a broker, agent, or other intermediary has the status of merchant in that transaction
question
Offer
answer
An offer must be definite enough for the parties to ascertain its essential terms when it is accepted. The UCC states that a sales or lease contract will not fail for indefiniteness even if one or more terms are left open as long as both of the following are true 1. The parties intended to make a contract 2. There is a reasonably certain basis for the court to grant an appropriate remedy
question
Good faith
answer
Under the UCC, this means honesty in fact and the observance of reasonable commercial standards of fair dealing in the trade
question
Requirements contract
answer
the buyer agrees to purchase and the seller agrees to sell all or up to a stated amount of what the buyer requires
question
Output contract
answer
The seller agrees to sell and the buyer agrees to buy all or up to a stated amount of what the seller produces
question
Firm offer
answer
Arises when a merchant-offeror gives assurances in a signed writing that the offer will remained open. The offer must be written (or electronically recorded) and signed by the offeror
question
Contract when one party is not a merchant
answer
If one (both) of the parties is a nonmerchanct, the contract is formed according to the terms of the original offer and doesn't include any of the additional terms int eh acceptance
question
Contracts between merchants
answer
Additional terms automatically become a part of the contract unless 1. The original offer expressly limited acceptance to its terms 2. The new or changed terms materially alter the contract 3. The offeror objects to the new or changed terms within a reasonable period of time
question
Consideration
answer
The UCC doesn't require a contract modification to be supported by new consideration
question
Statute of Frauds
answer
Sales contracts for goods priced at $500 or more and lease contracts requiring total payments of $1,000 or more must be in writing to be enforceable
question
Sufficiency of the writing
answer
A writing, e-mail will be sufficient to satisfy the UCC's statute of frauds as long as it indicates that the parties intended to form a contract, and is signed by the party against whom enforcement is sought
question
Specially manufactured goods
answer
An oral contract for the sale/lease of custom-made goods will be enforceable if 1. the goods are specially manufactured for a particularly buyer or specially manufacture or obtained for a particular lessee 2. The goods are not suitable for resale or lease to others in the ordinary course of the seller's or lessor's business 3. The seller or lessor has substantially started to manufacture the goods or has made commitments for the manufacture or procurement of the goods
question
Admissions
answer
An oral contract for the sale or lease of goods is enforceable if the party against whom enforcement is sough admits in pleadings, testimony, or other court proceedings that a sales or lease contract was made
question
Partial performance
answer
An oral contract for the sale or lease of goods is enforceable if payment has been made and accepted or goods have been received and accepted. The oral contract will be enforced at least to the extent that performance actually took place
question
Fully integrated contract
answer
When a contract completely sets forth all the terms and conditions agreed to by the parties and is intended as a final statement of their agreement, it's considered fully integrated.
question
Course of dealing
answer
It's a sequence of actions and communications between the parties to a particular transaction that establishes a common basis for their understanding
question
Usage of Trade
answer
Any practice or method of dealing that is so regularly observed in a place, vocation, or trade as to justify an expectation by the parties that it will be observed in their transaction
question
Course performance
answer
The conduct that occurs under the terms of a particular agreement
question
Rules of Construction
answer
Provided by the UCC for interpreting contracts, the priority being 1. Express terms 2. Course of performance 3. Course of dealing 4. Usage of trade
question
Unconscionability
answer
If deemed this, the court can 1. Refuse to enforce the contract 2. Enforce the remainder of the contract without the unconscionable part 3. Limit the application of the unconscionable term to avoid tan unconscionable result
question
Choice of language clause
answer
Designates the official language by which the contract will be interpreted in the event of disagreement
question
Choice of law clause
answer
A contractual provision designating the applicable law, it's typically included in every international contract
question
Force majeure clause
answer
'impossible or irresistible force' Commonly stipulate that in addition to acts of God, a number of other eventualities (governmental orders or regulations, embargoes, extreme shortages of materials) may excuse a party from liability for nonperformance
