UCC Article 2 Sales Mnemonics .txt
Home > Flashcards > Print Preview
The flashcards below were created by user
on FreezingBlue Flashcards
. What would you like to do?
If BOTH PARTIES ARE MERCHANTS the additional terms in an acceptance become part of the contract unless “O-CAN”,O: offeror OBJECTS to the original terms within a reasonable time
C: original offer expressly CONDITIONED agreement exclusively to those terms contained in the offer
A: when the additional terms materially ALTER the contract terms, then those terms do not become party of the contract
- • a term contained in the acceptance MATERIALLY ALTERS the contract offer if it would cause surprise or hardship if the offeror were not made aware of its existence.
- Materially altering terms are "J-STRAW"
NON-MERCHANTS: where one or both parties are non-merchants, then offeror can remain silent and is not bound to accept either material or non-material additional terms that have been added to the acceptance
- • The UCC considers them mere proposals that do not become part of the contract.
- Materially altering k terms are J-STRAW,Materially Altering k terms are (J-STRAW)
- o J – clause bestowing JURISDICTION upon a particular court; or, requiring offeror to consent to jurisdiction in a particular court
- o S- SHORTENING the SoL to sue for non-conforming goods
- o T – limiting TORT liability or limiting the seller’s liability for a buyer’s consequential damages (3 R Clause)
- o R – altering the UCC rules for RISK of loss
- oA –adding an ARBITRATION clause (unless arbitration was the customary practice in that trade)
- oW – a clause disclaiming the 'M-FEET' WARRANTIES (i.e. merchantibility, fitness for a particular purpose, express warranty, etc...)•
- Note: ‘J-STRAW’ is not an excusive list. Materially altering k terms can also include other terms that would materially alter a contract’s offer.
- •Additional terms added to an acceptance that DO NOT MATERIALLY ALTER the offer become part of the contract UNLESS objection is timely made by the offeror.
A: ACCEPTANCE can be revoked
- R: REJECTION of non-conforming goods
- A sales contract may contain the following express or implied warranties. [M-FEET],•MERCHANIBILITY
- oUnless, expressly excluded, a merchant impliedly warrants, that the goods sold are “fit for their ordinary purpose”.
- oThe goods must pass without objection in the trade under the description in the contract – not the best, not the worst – but fair and average quality.
- oThe implied warranty of Merchantability is given by only a limited class of merchants – namely, merchants with respect to goods of that kind.
- This restricts the merchantability warranty that is narrower than just those who engage in business.
- oThus, a merchant, making only an isolated sale of this type of good, is not considered a merchant and gives no implied warranty of merchantability.
- Ex: I go to barber shop. They try to sell hair tonic. I buy hair tonic. It takes my hair out. I can go after them for breach of implied warranty of merchantability.
- Ex: I go to barber shop. They sell me a tv. TV fails at home. I can’t go after barber for implied warranty of merchantability becaus
- Express Warranties are SAD,oExpress Warranties (EW) can be given by both merchants and non-merchants.
- oBut, in order to sue on an EW, the EW must have been the “basis of the bargain”. That is, the buyer must have seen/heard the EW and relied on the Express Warranty.
- oExpress Warranties derive from the SAD
- •Any sample/model that was the basis of the bargain
- oEx: The “Shamwow” sample that influenced your decision that allegedly absorbs 12x its weight and soaks up to 3 gallons of water.
- •Any written/oral affirmation of fact/promise made by the seller to the buyer relating to the goods that becomes part of the basis of the bargain which induced the buyer to purchase the goods.
- •Statements made by the seller during contract negotiations are considered affirmations of fact
- •UNLESS that statement would be construed by a reasonably prudent person (RPP) only as a seller’s opinion or puffery.
- •Any description of the goods in an advertisement/brochure/catalog.
- oAny S
- Plaintiff’s claim against Seller for defective good can be based upon one or more overlapping PINE theories of liability.
- Hint: I PINE for defective product liability,oProducts liability
- oImplied warranty breach – contract theory implied warranty
- oNegligence tort theory
- oExpress Wararnty – contract theory for breach of ‘SAD’ Express Warranty
- G.P.PALMS is not liable for breach of warranty.,•In a breach of warranty claim, the Seller Can Raise the Following Defense to Breach of Warranty
- 1) GOVERNMENT Contractor Defense
- •A manufacturer cannot be held liable for a defectively designed military product, if the (1) defect was caused by the government’s own design specifications AND (2) the manufacturer warned the government of any known dangers.
- 2)P - Lack of PRIVITY of Contract
- •Breach of warranty claims arising from sale of goods require some form of privity of contract with the seller who has expressly/impliedly warranted the performance of that product.
- •Parties who have entered a contract with each other (i.e. buyer and seller) are in direct privity.
- oAt common law, only buyers in direct privity could recover for the harm caused by the defective/unsafe product.
- •Extension of PRIVITY
- ooHousehold Privity: Under UCC Article 2, a seller express/implied warranties extend horizontally beyond the buyer to any natural person who suffers a physical injury (per
- a DIM product is defective,•A manufacturer (or regular seller) of a DUD (defective and unreasonably dangerous) product is strictly liable for physical harm proximately caused by the product’s dangerously defective DIM conditions (DEFECTIVE design, INADEQUATE warning, MISTAKE in manufacture)
What would you like to do?
Home > Flashcards > Print Preview