Uniform Commercial Code Flashcards, test questions and answers

Question 1

True or False? Congress enacted the Uniform Commercial Code for adoption by the states.

Answer

False; The National Conference of Commissioners on Uniform State Laws
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Question 2

The Uniform Commercial Code laws include sales laws and other regulations affecting commerce, such as bank deposits and collections, title documents, and warranties.

Answer

The ______ is a significant body of law to business activities including sales, banking, and warranty.
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Question 3

Faylene underwent heart surgery that included, among other measures, the implantation of a pacemaker in her chest. Faylene later alleged that the surgeon’s negligence resulted in a serious infection. Faylene’s insurance company stated that the Uniform Commercial Code (UCC) governed the dispute because at issue was a contract for a pacemaker, which is a good. The hospital responded that the claim was based on a contract for a surgery, which is a service, and was therefore covered by the common law. What result is most likely?

Answer

c. The court will apply the predominant purpose test and will probably hold that this was a contract for a service.
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Question 4

Which of the following contracts is handled under common law rules rather than under Article 2 of the Uniform Commercial Code? 1) Oral contract to have hair styled in which expensive products will be used on the hair. 2) Oral contract to purchase a textbook for $100. 3) Written contract to purchase an old handcrafted chair for $600 from a private party. 4) Written contract to purchase a heater from a dealer to be installed by the buyer in her home.

Answer

1) Oral contract to have hair styled in which expensive products will be used on the hair. Article 2 of the UCC applies to sales of goods. Common law generally applies to contracts for services and real estate. Even though goods are used in this service contract, the predominate feature of this contract is the service. Article 2 of the UCC governs this contract even though it is oral and for a small sum. Even though the chair at one time involved a lot of labor, it is still a sale of goods. Also, whether the parties are merchants or not is not an issue on whether Article 2 applies. The heater which is not yet installed in the home is a sale of goods. Once it is installed in the home, it becomes part of the real estate for any future sale of the home. Common law rules would apply to any such future sale.
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Question 5

When borrowing for the purchase of personal property; such as when acquiring a furnished home, The Uniform Commercial Code requires the borrower: pledge real property as chattles sign a security agreement and file a financing statement record the deed obtain an abstract of title

Answer

sign a security agreement and file a financing statement The Uniform Commercial Code (UCC or the Code), first published in 1952, is one of a number of uniform acts that have been promulgated in conjunction with efforts to harmonize the law of sales and other commercial transactions in all 50 states. The goal of harmonizing state law is important because of the prevalence of commercial transactions that extend beyond one state. For example, goods may be manufactured in State A, warehoused in State B, sold from State C and delivered in State D. The UCC therefore achieved the goal of substantial uniformity in commercial laws and, at the same time, allowed the states the flexibility to meet local circumstances by modifying the UCC’s text as enacted in each state. The UCC deals primarily with transactions involving personal property (movable property), not real property (immovable property). The UCC-1 “security agreement” establishes a lien against personal property. Rather than filing the “security agreement” the UCC allows a short form called the “financing statement” to be recorded. This occurs in real estate transactions when personal property is sold with real estate; such as the sale of a furnished home or a fully equipped restaurant.
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Question 6

Elliot enters into a contract to purchase JD’s house, and then changes her mind. JD sues her for breach of contract. The lawsuit for a breach of contract will be governed by a. the Uniform Commercial Code b. common law of contracts. c. state statute. d. agency regulations.

Answer

b. common law of contracts.
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Question 7

Does McCann owe the interest accrued? Discuss Uniform Commercial Code Section 2-207

Answer

Yes, he does. UCC 2-207 dramatically changes the common law mirror image rule for the sale of goods. Under UCC 2-207 an acceptance that contains additional or different terms may create a contract. It says that between merchants, an additional term becomes part of the contract unless the proposal meets one of the following exceptions: 1) the offer expressly limits acceptance to the terms of the offer; 2) the additional term materially alters the offer; or 3) the offeror promptly objects to it.
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Question 8

Uniform Commercial Code (UCC)

Answer

A model act that includes comprehensive laws that cover most aspects of commerical transactions. All the states have enacted all or part of the UCC as statutes.
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Uniform Commercial Code Flashcards, test questions and answers

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