Exam 23: Title and Risk of Loss

In an FOB place of shipment contract, the seller's obligation ends when he delivers the goods to a carrier for shipment.

Most courts hold that when a customer takes an item from the shelf in a self-service store, there is:

A consignment sale is treated as a(n) __________ under UCC Article 2, and the dealer-consignee has full authority to sell the goods for the consignor and can pass title to the goods.

Someone who finds and resells stolen property passes on a good title to a good faith purchaser.

In a non-shipment contract involving a merchant-seller, risk of loss passes to the buyer when he actually receives the goods from the merchant.

__________ reserve auctions are those in which the goods must be sold regardless of whether the auctioneer is satisfied with the levels of the bids.

"Without reserve" auctions give the auctioneer the right to withdraw the goods from the sale process if the bids are not high enough.

If a buyer purchases goods on approval, the buyer's creditors cannot reach such goods until there is an approval.

Anderson Clock Company is in the business of selling and repairing clocks. Jay purchased a grandfather clock from them. Laurie had left the clock at Anderson's for a cleaning and calibration. When Laurie found out the clock had been sold, she contacted Jay and demanded he return it. Must Jay comply with Laurie's demand? What other options does she have?

A buyer with a voidable title cannot pass on valid title to a subsequent good faith purchaser.

In the case of a nonshipment contract, risk of loss passes to the buyer upon actual receipt of goods:

When a person picks out a custom necktie and purchases it, the transaction involves fungible goods.

__________reserve auctions are those that give the auctioneer the right to withdraw the goods from the sale process if the bids are not high enough.

Bob Corporation entered into a contract to sell parts to Zeck. The contract provided that the goods would be shipped "FOB Bob's warehouse." Bob shipped parts to Zeck that were stolen from the carrier. When Zeck checked the invoice, Zeck discovered that Bob had sent Model #20B instead of Model #20A, which the contract required. Whose loss? Why?

If an owner has acted in a way that misleads others, the owner may be __________from asserting ownership.

Fungible goods are always homogeneous.

If shipped goods are damaged or destroyed after risk of loss passes:

A seller's insurable interest in goods always terminates with the passage of the title to the buyer.

In an FOB place of shipment contract the seller's risk of loss for goods under an that are damaged in transit, ends when they are

Title to goods can be transferred without the actual delivery of the goods involved.