CH-13

Matching QuestionsMatch the following terms with their definitions:

(2) A. Additional terms

(3) B. Strict liability

(1) C. Merchantability

(4) D. Different terms

1. An implied warranty that goods are fit for their ordinary purpose.

2. Generally become part of a contract between merchants.

3. The reasonableness of defendant’s conduct is irrelevant.

4. Generally cancel each other out.

True/False QuestionsCircle true or false:

1. T F In a contract for the sale of goods, the offer may include any terms the offeror wishes; the offeree must accept on exactly those terms or reject the deal.

2. T F Sellers can be bound by written warranties but not by oral statements.

3. T F Under strict liability, an injured consumer could potentially recover damages from the product’s manufacturer and the retailer who sold the goods.

4. T F A contract for the sale of $300 worth of decorative stone must be in writing to be enforceable.

Multiple-Choice Questions

1. Which one of the following transactions is not governed by Article 2 of the UCC?

(a) Purchasing an automobile for $35,000(b) Leasing an automobile worth $35,000 (c) Purchasing a stereo worth $501(d) Purchasing a stereo worth $499

2. Marion orally agrees to sell Ashley her condominium in Philadelphia for $700,000. The parties have known each other for 20 years and do not bother to put anything in writing. Based on the agreement, Marion hires a moving company to pack up all her goods and move them to a storage warehouse. Ashley shows up with a cashier’s check, and Marion says, “You’re going to love it here.” But at the last minute, Marion declines to take the check and refuses to sell. Ashley sues and wins

(a) Nothing

(b) The condominium

(c) $700,000

(d) The difference between $700,000 and the condominium’s market value

(e) Damages for fraud

3. Seller’s sales contract states that “The model 8J flagpole will withstand winds up to 150 mph, for a minimum of 35 years.” The same contract includes this: “This contract makes no warranties, and any implied warranties are hereby disclaimed.” School buys the flagpole, which blows down six months later, in a 105-mph wind.

(a) Seller is not liable because it never made any express warranties.

(b) Seller is not liable because it disclaimed any warranties.

(c) Seller is liable because the disclaimer was invalid.

(d) Seller is liable because implied warranties may not be disclaimed.

4. Manufacturer sells a brand-new, solar-powered refrigerator. Because the technology is new, Manufacturer sells the product “as is.” Plaintiff later sues Manufacturer for breach of warranty and wins. Plaintiff is probably

(a) A distributor with no understanding of legal terminology

(b) A retailer who had previously relied on Manufacturer

(c) A retailer who had never done business before with Manufacturer

(d) A retailer who failed to notice the “as is” label

(e) A consumer

5. CPA QUESTION: To establish a cause of action based on strict liability in tort for personal injuries resulting from using a defective product, one of the elements the plaintiff must prove is that the seller (defendant)

(a) Failed to exercise due care

(b) Was in privity of contract with the plaintiff

(c) Defectively designed the product

(d) Was engaged in the business of selling the product