LLB 120 Lecture : LLB120 notes

TRUE or FALSE

1.The UCC requires application of the "mirror image" rule in cases where contracts for the sale of goods are made by exchanging forms.

2.A contract generally comes into existence and becomes binding at the moment the parties have reached an agreement on all material provisions, although they may intend to later write down the terms of the agreement.

3.An acceptance must be in writing.

4.If an authorized means of acceptance is expressly present, any attempt by the offeror to accept by a non-authorized means is effective upon dispatch.

5.A bilateral contract is a promise for a promise.

6. If one or both parties to a form contract are non-merchants, the additional terms proposed by one of the parties are treated as:

7. Under the UCC Rule 2-207 for the sale of goods when a contract is made by the exchange of forms, when the acceptance form has terms additional to or different from the offer:

1. An offer is a proposal by an offeror that, if accepted, will create a contract. Offers require that the offeror make a promise. The promise can be express or implied. The offer must bargain for a return promise, an act, or forbearance, and it must describe what is being offered (the subject matter) with enough certainty so that a court will not have to guess at what the offeror intended. The offer must be communicated to the offeree, and it must be proven that the offeror manifested the intent to make an offer. How would an offeree prove that an offeror intended to make an offer if the offeror alleged that she was only kidding or that her proposal was merely an invitation to the other party to make an offer?

2. Offerors have the legal right to revoke their offers if they effectively do so before the offeree accepts. There are, however, several circumstances that would preclude the offeror from revoking the offer. Please identify these circumstances and give an example of each.

CH22_Blueprint_Performance_of_Sales_Contracts_-_Assurance

Flint Hills Resources, LP, a crude oil refiner, agreed to buy "approximately 1,000 barrels per day" of Mexican natural gas condensate from JAG Energy, Inc., an oil broker. Four months into the contract, Pemex, the only authorized seller of freshly extracted Mexican condensate, warned Flint Hills that some companies might be selling stolen Mexican condensate. Fearing potential criminal liability, Flint Hills refused to accept more deliveries from JAG without proof of the title to its product. JAG promised to forward documents showing its chain of title. After several weeks, when JAG did not produce the documents, Flint Hills canceled their agreement. JAG filed a suit in a federal district court against Flint Hills, alleging breach of contract.

What is the name of the law that applies to the duties and obligations of parties to a sale of goods contract?

a. Uniform Transactions Code

b. Uniform Sales Code

c. Uniform Commercial Code

d. Uniform Goods Code

Who is the seller?

a. Flint Hills Resources

b. JAG Energy

Who is the buyer?

a. Flint Hills Resources

b. JAG Energy

The seller's obligation is to tender

a. perfect good

b. conforming goods

c. reasonably perfect goods

d. adequately conforming goods

This rule is called the

a. confirmation rule

b. good faith rule

c. perfect tender rule

d. reasonable tender rule

Is JAG Energy potentially not tendering conforming natural gas condensate?

a. Yes

b. No

What might be the problem with the tender?

a. the goods are stolen

b. the goods might be stolen

c. there is no problem as there is no proof

What exception to the perfect tender rule arises here?

a. the parties agreed to waive any criminal implications

b. the parties agreed that using a different carrier was acceptable

c. the parties agreed to accept a nonconforming installment

d. an occurrence unforeseen by either party is making performance commercially impracticable

e. one party has reasonable grounds to believe the other party will not perform

f. one party is refusing to cooperate

Does this particular exception apply equally to both the buyer and seller?

a. Yes

b. No

Who is worried about performance in this case?

a. buyer

b. seller

What section of the UCC applies when one party believes the other will not perform?

a. 2-311

b. 2-609

c. 2-615

d. 2-613

Does UCC 2–609 state that if a contracting party has "reasonable grounds" to believe that the other party will not perform, he or she may "demand adequate assurance" of that performance?

a. Yes

b. No

Does the buyer, Flint, have reasonable grounds to believe the natural gas condensate to be delivered by JAG may be stolen?

a. Yes

b. No

Why? Pemex ______ the only authorized seller of natural gas condensate.

a. is

b. is not

After asking for assurance from JAG, how many days does Flint have to wait before a non-response from JAG may be considered a repudiation of the contract?

a. 14

b. 30

c. 60

d. 90

Does Flint have to keep making payments while they wait?

a. Yes

b. No

Did JAG ever produce proof of title for the natural gas condensate?

a. Yes

b. No

How long did Flint wait?

a. several weeks

b. a few weeks

c. eight weeks

Assume Flint waited more than 30 days. Would UCC2-609 apply?

a. Yes

b. No

Under the UCC2-609, did Flint have a right to cancel the contract?

a. Yes

b. No

((What if the facts were different?))

What if Flint had heard about this allegation of stolen natural gas from someone other than Pemex- would their demand for assurance be justified?

a. Yes

b. No

Why? The information from any other source would be

a. reasonable grounds

b. unreasonable grounds