Exam 13: The Formation of Sales and Lease Contracts

Medico Inc. enters into a contract to sell medical supplies to New Hospital Corporation, which sells some of the items to Physicians Clinic, which later sells them to Oscar, a patient and consumer. Article 2 of the UCC applies to the sales transactions between

Goods associated with real estate never fall within the scope of UCC Article 2.

Under the UCC, prompt shipment of goods is considered an acceptance of an offer to buy the goods.

To be characterized as a "good" under the UCC, an item of property must be movable.

Sara and Tim enter into a contract for a sale of orchids. With respect to the specific contractual provisions set out in the UCC, these parties may

Under the UCC, the meaning of any agreement must be interpreted in light of commercial practices.

Refined Metals Company and Superior Fabrication, Inc., enter into a contract under which Refined agrees to deliver a certain quantity of sheet metal to Superior each month. The contract does not include a price term. In a suit between the parties over the price, a court will

Fact Pattern 13-1 Farmers Produce, Inc., and Growers Market enter into a contract for the delivery of locally grown fruits and vegetables. The parties use a standard Farmers Produce form that contains some of the terms the parties agree on but not others. Some of the produce spoils before it can be cooked, served, and eaten, or sold. Growers Market refuses to pay for the spoiled goods. -Refer to Fact Pattern 13-1.Farmers Produce responds that it did not waive payment for spoiled goods in the parties' previous transaction. Farmers Produce is arguing that the court should take into account

Under the UCC, if a contract for a sale of goods does not specify the quantity, a court will objectively determine what is a reasonable quantity.

For an item to be characterized as a "good" under the UCC, it must be intangible.

According to the UCC, one open term will cause a sales contract to fail for indefiniteness.

Fact Pattern 13-1 Farmers Produce, Inc., and Growers Market enter into a contract for the delivery of locally grown fruits and vegetables. The parties use a standard Farmers Produce form that contains some of the terms the parties agree on but not others. Some of the produce spoils before it can be cooked, served, and eaten, or sold. Growers Market refuses to pay for the spoiled goods. -Refer to Fact Pattern 13-1.Farmers Produce files a suit against Growers Market, claiming that the buyer assumed the risk of the spoilage of the unsold goods. The court may allow evidence of this term if it finds that the parties' contract is

The UCC requires a contract modification to be supported by new consideration.

Dian, an agent for Expo Motors, Inc., writes a letter to Flynn on November 1 stating that she will sell him a 2017 Subaru Outback for $25,000 between November 1 and December 31. Dian's letter to Flynn is

Leslie pays Mobile Electronics $600 for a new phone. Under the UCC, this is

The UCC requires that the mirror image rule be followed for all acceptances.

Containers, Inc., sends its standard order form to Distribution Corporation to evidence a sale of packing materials. Distribution responds with its own standard purchase order form. Additional terms in the purchase order automatically become part of the contract unless

A firm offer by a merchant may be oral.

Under the "partial performance" exception to the UCC, an oral contract for goods worth more than $500 is enforceable if the goods are designed to partially perform a specific function.

The terms of a fully integrated contract can be contradicted by evidence of any prior agreements.