Question 1

Every sale or lease by a merchant who deals in goods of the kind sold or leased automatically gives rise to an implied warranty of merchantability.

Accepted Answer

A) True 
 B)False

Question 2

Darrow purchases a new car from Slippery Motors. The retail installment contract states immediately above the buyer's signature in large, bold type: "There are no warranties that extend beyond the description on the face hereof" and "There are no express warranties that accompany this sale unless expressly written in this contract." Before purchasing the car, Darrow specifically informed Slippery's salesperson that he wanted a car that could be driven in a dusty area without needing mechanical repairs. Slippery's salesperson said to Darrow, "Nothing will go wrong with this car, but if it does, return it to us, and we will repair it without cost to you." Neither this statement nor any similar statement appears in the retail sales contract. Darrow drives the car into a dust storm. The air filter gets plugged up, and the car engine overheats, causing motor damage. Slippery Motors refuses to repair the engine under any warranty. Darrow claims that Slippery is liable for breach of the implied warranty of fitness for a particular purpose, that the Magnuson-Moss Warranty Act prohibits disclaiming this implied warranty, and that the salesperson's express warranty has also been breached. What are the problems with Darrow's claims

Accepted Answer

Darrow has a number of problems with the

Question 3

Air Navigation, Inc., makes aviation guidance systems. Ollie is injured in a crash caused by a defective Air Navigation product. A statute restricts the time within which Ollie may file a product liability suit against Air Navigation regardless of when he was injured. This is a statute of

Accepted Answer

A)  limitations. 
B)  preemption. 
C)  repose. 
D)  suspension. 
A)  limitations. 
B)  preemption. 
C)  repose. 
D)  suspension.

Question 4

Farm Equip, Inc., makes farming machinery. Gail discovers that her Farm Equip tractor is defective and sues the maker for product liability based on negligence. To win, Gail must show that

Accepted Answer

A)  Farm Equip sold the tractor to Gail. 
B)  Gail knew and appreciated the risk caused by the defect. 
C)  Gail suffered an injury caused by the defect. 
D)  the "defect" was a commonly known danger. 
A)  Farm Equip sold the tractor to Gail. 
B)  Gail knew and appreciated the risk caused by the defect. 
C)  Gail suffered an injury caused by the defect. 
D)  the "defect" was a commonly known danger.

Question 5

City Cab Company and Dave's Autos enter into a contract for a sale of motor vehicles. City assures Dave's that it has valid title to the vehicles. Under the UCC, warranties of title arise

Accepted Answer

A)  automatically in most sales contracts. 
B)  only if the buyer asks for such a warranty. 
C)  only if the seller expresses such a warranty. 
D)  only in conjunction with lease contracts, not sales contracts. 
A)  automatically in most sales contracts. 
B)  only if the buyer asks for such a warranty. 
C)  only if the seller expresses such a warranty. 
D)  only in conjunction with lease contracts, not sales contracts.

Question 6

A product liability action based on negligence requires the injured plaintiff and the negligent defendant-manufacturer to be in privity of contract.

Accepted Answer

A) True 
 B)False

Question 7

Promises of fact made during the bargaining process are not express warranties.

Accepted Answer

A) True 
 B)False

Question 8

Dependable Appliances, Inc., and Elain 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

Accepted Answer

A)  fit for the buyer's particular purpose. 
B)  fit for the ordinary purpose for which such goods are used. 
C)  suitable for resale at an acceptable price. 
D)  the best quality that money can buy. 
A)  fit for the buyer's particular purpose. 
B)  fit for the ordinary purpose for which such goods are used. 
C)  suitable for resale at an acceptable price. 
D)  the best quality that money can buy.

Question 9

Fun Toyz Corporation makes skateboards, which it sells to consumers, including Gitana. Gitana is injured due to a defect in the board that causes an accident in which Haley, a bystander, is also injured. In a product liability suit based on strict product liability, Fun Toyz may be liable to

Accepted Answer

A)  Gitana and Haley. 
B)  Gitana only. 
C)  Haley only. 
D)  no one. 
A)  Gitana and Haley. 
B)  Gitana only. 
C)  Haley only. 
D)  no one.

Question 10

An action in strict product liability requires that the product not be in a defective condition when the defendant sells it.

Accepted Answer

A) True 
 B)False

Question 11

Safe-T-Made Company makes electrical cords and other connectors for electronic devices. Rowena files a product liability suit against Safe-Rite, alleging a warning defect. Under the Restatement (Third) of Torts: Products Liability, in deciding whether to hold Safe-T-Made liable, the court may consider

Accepted Answer

A)  the expectations of the seller. 
B)  the identities of the company's owner. 
C)  the intentions of the manufacturer. 
D)  the characteristics of expected users. 
A)  the expectations of the seller. 
B)  the identities of the company's owner. 
C)  the intentions of the manufacturer. 
D)  the characteristics of expected users.

Question 12

Mountain Bikes, Inc. (MBI), and Nero enter into a contract for a sale of a mountain bike. MBI, a merchant who deals in goods of the kind sold, makes implied and express warranties in connection with the sale. The Magnuson-Moss Warranty Act was designed to prevent deception in warranties by

Accepted Answer

A)  displacing the UCC as the primary source of warranty rules. 
B)  making warranties easier to understand. 
C)  prohibiting disclaimers of warranties. 
D)  requiring sellers to give written warranties for consumer goods. 
A)  displacing the UCC as the primary source of warranty rules. 
B)  making warranties easier to understand. 
C)  prohibiting disclaimers of warranties. 
D)  requiring sellers to give written warranties for consumer goods.

Question 13

To be merchantable, goods must be at least average, fair, or medium-grade quality.

Accepted Answer

A) True 
 B)False

Question 14

Implied warranties can arise as a result of a course of dealing.

Accepted Answer

A) True 
 B)False

Question 15

Every seller is required to provide a written warranty for consumer goods sold.

Accepted Answer

A) True 
 B)False

Question 16

Woodgrain Products Company and Sylvia enter into a contract for a sale of lumber. Woodgrain knows the purpose for which Sylvia will use the goods. Under the UCC, an implied warranty of fitness of a particular purpose arises

Accepted Answer

A)  if the buyer is relying on the seller to select suitable goods. 
B)  if the buyer asks for it. 
C)  if the seller is a merchant who deals in goods of the kind sold. 
D)  in conjunction with lease contracts, not sales contracts. 
A)  if the buyer is relying on the seller to select suitable goods. 
B)  if the buyer asks for it. 
C)  if the seller is a merchant who deals in goods of the kind sold. 
D)  in conjunction with lease contracts, not sales contracts.

Question 17

Sari buys a new sport utility vehicle (SUV) from 'Tastic Cars & Trucks, Inc. The most important factor in determining whether an express warranty is created is whether

Accepted Answer

A)  Sari expresses to 'Tastic what she wants warranted. 
B)  Sari's desire for the SUV becomes part of her motivation to deal. 
C)  'Tastic expresses to Sari what it expects of its customers. 
D)  'Tastic's promise becomes part of the basis of the bargain. 
A)  Sari expresses to 'Tastic what she wants warranted. 
B)  Sari's desire for the SUV becomes part of her motivation to deal. 
C)  'Tastic expresses to Sari what it expects of its customers. 
D)  'Tastic's promise becomes part of the basis of the bargain.

Question 18

A public policy underlying the imposition of strict product liability is that consumers should be protected against unsafe products.

Accepted Answer

A) True 
 B)False

Question 19

Olga, a salesperson for Pre-owned Cars & Trucks, Inc., tells Quincy, "This is the best car I've ever seen." This statement is

Accepted Answer

A)  an express warranty. 
B)  an implied warranty. 
C)  a warranty of title. 
D)  puffery. 
A)  an express warranty. 
B)  an implied warranty. 
C)  a warranty of title. 
D)  puffery.

Question 20

GR8 Skates Company makes and sells a pair of skates to Homer. GR8 fails to exercise "due care" to make the skates safe, and Homer is injured as a result. GR8 is most likely liable for

Accepted Answer

A)  assumption of risk. 
B)  knowledgeable use. 
C)  negligence. 
D)  foreseeable misuse. 
A)  assumption of risk. 
B)  knowledgeable use. 
C)  negligence. 
D)  foreseeable misuse.

Exam 22: Warranties and Product Liability

Every sale or lease by a merchant who deals in goods of the kind sold or leased automatically gives rise to an implied warranty of merchantability.

Air Navigation, Inc., makes aviation guidance systems. Ollie is injured in a crash caused by a defective Air Navigation product. A statute restricts the time within which Ollie may file a product liability suit against Air Navigation regardless of when he was injured. This is a statute of

Farm Equip, Inc., makes farming machinery. Gail discovers that her Farm Equip tractor is defective and sues the maker for product liability based on negligence. To win, Gail must show that

City Cab Company and Dave's Autos enter into a contract for a sale of motor vehicles. City assures Dave's that it has valid title to the vehicles. Under the UCC, warranties of title arise

A product liability action based on negligence requires the injured plaintiff and the negligent defendant-manufacturer to be in privity of contract.

Promises of fact made during the bargaining process are not express warranties.

Dependable Appliances, Inc., and Elain 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

Fun Toyz Corporation makes skateboards, which it sells to consumers, including Gitana. Gitana is injured due to a defect in the board that causes an accident in which Haley, a bystander, is also injured. In a product liability suit based on strict product liability, Fun Toyz may be liable to

An action in strict product liability requires that the product not be in a defective condition when the defendant sells it.

Mountain Bikes, Inc. (MBI), and Nero enter into a contract for a sale of a mountain bike. MBI, a merchant who deals in goods of the kind sold, makes implied and express warranties in connection with the sale. The Magnuson-Moss Warranty Act was designed to prevent deception in warranties by

To be merchantable, goods must be at least average, fair, or medium-grade quality.

Implied warranties can arise as a result of a course of dealing.

Every seller is required to provide a written warranty for consumer goods sold.

Woodgrain Products Company and Sylvia enter into a contract for a sale of lumber. Woodgrain knows the purpose for which Sylvia will use the goods. Under the UCC, an implied warranty of fitness of a particular purpose arises

Sari buys a new sport utility vehicle (SUV) from 'Tastic Cars & Trucks, Inc. The most important factor in determining whether an express warranty is created is whether

A public policy underlying the imposition of strict product liability is that consumers should be protected against unsafe products.

Olga, a salesperson for Pre-owned Cars & Trucks, Inc., tells Quincy, "This is the best car I've ever seen." This statement is

GR8 Skates Company makes and sells a pair of skates to Homer. GR8 fails to exercise "due care" to make the skates safe, and Homer is injured as a result. GR8 is most likely liable for

Introduction to Law and Legal Reasoning

Courts and Alternative Dispute Resolution

Court Procedures

Constitutional Authority to Regulate Business

Ethics and Business Decision Making

Intentional Torts and Privacy

Negligence and Strict Liability

Intellectual Property and Internet Law

Criminal Law and Cyber Crime

Nature and Terminology

Agreement in Traditional and E-Contracts

Consideration

Capacity and Legality

Mistakes, Fraud, and Voluntary Consent

The Statute of Frauds

Third Party Rights

Performance and Discharge

Breach of Contract and Remedies

The Formation of Sales and Lease Contracts

Title, Risk, and Insurable Interest

Performance Breach of Sales Lease Contracts

International Law in a Global Economy

The Function Creation of Negotiable Instruments

Transferability and Holder in Due Course

Liability, Defenses, and Discharge

Checks and Banking in the Digital Age

Creditors Rights and Remedies

Secured Transactions

Bankruptcy Law

Mortgages Foreclosures After the Recession

Agency Formation and Duties

Agency Liability and Termination

Employment, Immigration, and Labor Law

Employment Discrimination

Sole Proprietorships and Franchises

Partnerships and Limited Liability Partnerships

Limited Liability Companies Special Business Forms

Corporate Formation and Financing

Corporate Directors, Officers, Shareholders

Corporate Merger, Consolidation, Termination

Securities Law Corporate Governance

Law for Small Business

Administrative Law

Consumer Law

Environmental Law

Antitrust Law

Professional Liaility and Accountability

Personal Property and Bailments

Real Property Landlord-Tenant Relationships

Insurance

Wills and Trusts

for Unit One

for Unit Two

for Unit Three

for Unit Four

for Unit Five

for Unit Sex

for Unit Seven

for Unit Eighet

for Unit Nine

for Unit Ten