Exam 22: Performance and Breach of Sales and Lease Contracts

If,before the time for performance,a buyer communicates an intent not to perform,the seller can consider the buyer in breach and pursue a remedy.

Dependable Appliances,Inc.,and Elaine enter into a contract for a sale of kitchen appliances. Dependable,a merchant who deals in goods of the kind sold,notes that its goods come with an implied warranty of merchantability. Under the UCC,this means that the goods are reasonably

Precision Parts,Inc.,and QuikFix Auto stores enter into a contract for a sale of specific auto parts. Precision Partsships parts that do not meet the specifications. QuikFix Auto

Roadway Paving Company contracts to buy some paving equipment from Stonework Earthmovers,Inc. Before either party performs,Stonework sells its assets to T-Square Corporation. On learning of the sale,Roadway is concerned about its contract with Stonework. Roadway should

Statements of fact made during the bargaining process are express warranties.

In sales law,failing to examine the goods and refusing to examine the goods are considered the same thing.

Daily Bread Bakeries,Inc.,contracts to buy all of its ingredient requirements for bread making,at a certain minimum per year,from Enriched Flour & Grain Corporation for six years. After three years,Daily Bread tells Enriched that it plans to sell its assets to Flat Bread Shops,Inc. Flat Bread refuses to assure Enriched that it will continue Daily Bread's contract. -Refer to Fact Pattern 22-1. Flat Bread's refusal is

A buyer's failure to cover will bar him or her from using any other remedies available under the UCC.

On May 1,Garage Prefabricators,Inc.,agrees to sell four portable garages to Hiway Truck Service Center. Five days later,Hiway refuses delivery and cancels the contract. Garage Prefabricatorsis enti-tled to

Puffery creates an express warranty.

A product is unmerchantable if an accident could arise in connection with the goods.

Band Instruments,Inc.,sells seventy-six trombones to Community & School Band Source,Inc. To avoid liability for most implied warranties,Band Instruments should state in writing that the trombones are sold

River Gear Company and Tours & Trips,Inc.,enter into a contract on August 1 for the sale of fifty inflatable river rafts. Tours & Trips cancels the con-tract ten days later. River Gear is unable to sell the rafts to another buyer. River Gear can

Under the UCC,there are no exceptions to the perfect tender rule.

Beef Burgers,Inc. contracts to buy five hundred head of cattle from Calf & CowFarms. Before Calf & Cow delivers,an outbreak of disease causes a quarantine of the farm. In this circumstance,the perfect tender rule

Implied warranties can arise from a "usage of trade."

To specifically disclaim an implied warrant of merchantability,a seller or lessor must mention the word merchantability.

Revocation of acceptance is not effective until notice is given to the seller or lessor.

If a warranty of infringement is breached and the buyer is sued by the claim holder,the buyer need not notify the seller of the lawsuit.

MotorCo Inc. makes and sells auto parts to retail repair services,vehicle sales outlets,and consumer parts stores. On one MotorCo box is a label that reads "Contains one gross (144)sparkplugs,assorted sizes." This statement is