1. Dacia is working out the terms of a contract
Reed’s paintings. Reed submits an offer in writing, which
states that Dacia may have the first option to purchase each
of his paintings within 30 days after completion, at $1,000
per painting. Dacia submits an offer in writing that indicates
her acceptance, but stipulates that if she’s unsatisfied with a
painting after purchase, she may return the painting for a full
refund within 10 days of delivery. Dacia and Reed are considered
merchants under the Uniform Commercial Code. What is
the result of these events?
A. No contract is formed, and Dacia’s offer is a counteroffer.
B. A contract is formed, and Dacia’s additional terms don’t
become part of the contract.
C. A contract is formed, and Dacia’s additional terms
become part of the contract.
D. No contract is formed, and Dacia’s offer is treated as a
rejection of Reed’s offer.
2. X Company manufactures bicycles. X Company shipped a group of bicycles to Y
Sporting Goods in Small Town, U.S.A. Johnny purchased one of the bicycles manufactured
by X Company from the Sporting Goods store. While he was riding the bicycle
the day after purchasing it, the front wheel fell off, and Johnny fell and broke his arm.
The cause of the accident was a defect that existed when X Company shipped it to Y
Sporting Goods. Will Johnny be successful if he files a lawsuit alleging strict liability?
A. Yes, each of the requirements for an action in strict liability is met.
B. No, the defendant must normally be engaged in the business
of selling or
distributing the product.
C. No, the product must be unreasonably dangerous to the user or consumer because
of its defective condition.
D. No, the goods must not have been substantially changed from the time the product
was sold to the time the injury was sustained.
3. Mary and George enter a contract in which George agrees to sell Mary vases made in
his vase factory in Bedford Falls, New York. XXXXX XXXXXves in Los Angeles, California. The
contract expressly states that the sale is F.O.B. (free on board) Los Angeles, California.
The vases are damaged during transport between Bedford Falls and Los Angeles. Who
bears the risk of loss?
A. George C. Both George and Mary
B. Mary D. Mary’s insurance carrier
4. Sam bought a new suit. The first time Sam took the suit to the cleaners it disintegrated
through no fault of the cleaners. What theory is best for recovering the price of the
suit from the seller?
A. Contributory negligence
B. Breach of implied warranty of merchantability
C. Breach of warranty of title
D. Unfair trade practices
5. John, an automobile dealer, entered a contract with Lisa in which Lisa agreed to
purchase a 1995 Chevrolet automobile from John for $2,000. John expressly told Lisa
that the motor in the automobile was bad, along with the clutch and brakes. Further,
John told Lisa that she would probably need to have the automobile repaired immediately
upon leaving the dealership. Lisa purchased the automobile despite its problems.
However, Lisa became disgruntled because the costs of the repairs were more than she
expected. She filed suit against John for breach of warranty. The most likely result will
be that Lisa will
A. win, because the implied warranty of merchantability was violated.
B. win, because the implied warranty of fitness for a particular purpose was violated.
C. lose, because no warranties were violated.
D. lose, because express warranties displace inconsistent implied warranties.
6. Jack and Barbara enter a contract in which Barbara agrees to deliver premium video
games to Jack in exchange for $2,500. Barbara has the goods shipped to Jack, and
Jack accepts the goods. However, the next day, Jack determines that the video games
aren’t premium video games at all, but are merely 10-year-old video games that
Barbara has recycled. Jack then notifies Barbara that he revokes his acceptance. Just
two hours after Jack notifies Barbara of this fact, the video games are struck by lightning
and destroyed. The most likely result will be that
A. Jack bears the risk of loss, because he accepted the shipment.
B. Jack bears the risk of loss, because the buyer always bears the risk of loss.
C. Barbara bears the risk of loss, because Jack revoked his acceptance.
D. Barbara bears the risk of loss, because the seller always bears the risk of loss.