Applicable Law
UCC Article 2 applies primarily to contracts for:
A. Real property
B. Services
C. Goods
D. Intellectual property
Goods
What is required to create an implied warranty of fitness?
A. Seller must be a merchant
B. Buyer chooses goods without input
C. Seller knows buyer’s specific purpose and that buyer relies on seller’s judgment
D. Buyer inspects the goods before purchase
Seller knows buyer’s specific purpose and that buyer relies on seller’s judgment
Under UCC Article 2, a contract can be formed even if one or more terms are missing, as long as the parties:
A. Use the same written form
B. Intend to make a contract and there is a reasonably certain basis for a remedy
C. Agree on every essential term
D. Sign before witnesses
Intend to make a contract and there is a reasonably certain basis for a remedy
Under the UCC’s perfect tender rule, the buyer may reject goods if:
A. They contain a minor, nonmaterial defect
B. The seller is not a merchant
C. Delivery is early
D. Buyer changes their mind
They contain a minor, nonmaterial defect
After the buyer breaches, the seller may recover damages equal to:
A. Contract price only
B. Market price minus contract price
C. Contract price minus market price
D. Contract price + incidental damages
Contract price minus market price
A contract for a mix of goods and services is governed by Article 2 when:
A. The parties say so
B. The predominant purpose of the contract is the sale of goods
C. The service portion is more than 10%
D. The goods are custom-made
The predominant purpose of the contract is the sale of goods
Which of the following is NOT part of the warranty of title?
A. Seller has good title
B. Transfer is rightful
C. Goods are free of undisclosed security interests
D. Goods are free from defects
Goods are free from defects
Under the UCC, an offer by a merchant in a signed writing promising to keep an offer open is called:
A. Option contract
B. Firm offer
C. Standing offer
D. Revocable offer
Firm offer
A seller may cure after the contract time has expired if:
A. The buyer agrees in writing
B. The seller had reasonable grounds to believe the nonconforming tender would be accepted
C. The buyer has already sued
D. The defect is trivial
The seller had reasonable grounds to believe the nonconforming tender would be accepted
A seller who resells the goods after buyer’s breach may recover:
A. Nothing unless resale is public
B. Resale price – contract price + incidental damages
C. Contract price only
D. Only consequential damages
Resale price – contract price + incidental damages
A “merchant” under Article 2 is defined primarily as someone who:
A. Sells goods occasionally
B. Deals in goods of the kind or has specialized knowledge
C. Works in a retail store
D. Operates any business
Deals in goods of the kind or has specialized knowledge
What phrase automatically disclaims all implied warranties?
A. “No refunds”
B. “Sold as is”
C. “This is a great product”
D. “Warranty void if opened”
“Sold as is”
A UCC firm offer is irrevocable for:
A. A reasonable time, but never more than 3 months
B. Exactly 30 days
C. As long as the merchant states
D. Until accepted
A reasonable time, but never more than 3 months
When goods are rejected, the buyer must:
A. Destroy them
B. Immediately sue for breach
C. Hold the goods with reasonable care for a time sufficient for the seller to remove them
D. Return the goods at the buyer’s expense
Hold the goods with reasonable care for a time sufficient for the seller to remove them
If the seller identifies goods to the contract and learns of the buyer’s insolvency, the seller may:
A. Reclaim goods delivered within 10 days
B. Sue for specific performance
C. Force buyer to cover
D. Demand punitive damages
Reclaim goods delivered within 10 days
Merchant status matters because:
A. Merchants get special warranties
B. Merchants are exempt from the UCC
C. Merchants are subject to additional UCC rules (e.g., firm offers, confirmation memos)
D. Merchants cannot reject goods
Merchants are subject to additional UCC rules (e.g., firm offers, confirmation memos)
To disclaim the implied warranty of fitness, the seller must:
A. Use the word “fitness”
B. Provide notice within 30 days
C. Use clear, conspicuous language (general disclaimer of implied warranties is enough)
D. Offer a cheaper alternative product
Use clear, conspicuous language (general disclaimer of implied warranties is enough)
A buyer orders goods; the seller ships nonconforming goods with a note stating “this is an accommodation.” Legally, this is:
A. Acceptance and breach
B. A counteroffer
C. Rejection
D. A firm offer
A counteroffer
In a destination contract (“FOB Buyer’s City”), risk of loss passes when:
A. Goods are tendered to the carrier
B. Goods arrive at the buyer’s location and are tendered there
C. Buyer pays for the goods
D. Goods are identified to the contract
Goods arrive at the buyer’s location and are tendered there
Buyer’s “cover” remedy refers to:
A. Seller paying for insurance
B. Buyer purchasing substitute goods in good faith
C. Buyer canceling the contract
D. Buyer rejecting late delivery
Buyer purchasing substitute goods in good faith
A contract for the sale of software is governed by Article 2 when:
A. It involves a physical copy (e.g., disk, boxed software)
B. It’s downloaded only
C. It’s licensed, not sold
D. It involves no goods at all
It involves a physical copy (e.g., disk, boxed software)
Which of the following does NOT create an express warranty?
A. “This car gets 40 MPG, tested.”
B. “This laptop contains 512GB of storage.”
C. “This is the best phone in the world!”
D. A sample product shown to the buyer
“This is the best phone in the world!”
In the “battle of the forms," a definite expression of acceptance with additional terms creates:
A. No contract
B. A counteroffer only
C. A contract, unless acceptance is made conditional on assent to new terms
D. An offer to negotiate
A contract, unless acceptance is made conditional on assent to new terms
If neither party is a merchant and the goods are to be picked up at the seller’s location, risk of loss passes:
A. Buyer must pay full price
B. Seller must replace the goods
C. Contract is avoided (voided)
D. Buyer pays half price
Upon tender of delivery
If the buyer does NOT cover, the buyer may recover:
A. Market price – contract price (measured at time of breach)
B. Contract price – market price
C. Only incidental damages
D. Only specific performance
Market price – contract price (measured at time of breach)