Bus Law Today Ch. 11 Terms & Review 10Th Ed. Miller

Front 1

Conforming Goods

Back 1

Goods that conform to contract specifications.

Front 2

Cover

Back 2

a remedy that allows the buyer or lessee, on the seller’s or lessor’s breach, to obtain substitute goods from another seller or lessor.

Front 3

Incidental Damages

Back 3

all costs resulting from a breach of contract, including all reasonable expenses incurred because of the breach.

Front 4

Installment Contract

Back 4

a contract that requires or authorizes delivery in two or more separate lots to be accepted and paid for separately.

Front 5

Replevin

Back 5

an action that can be used by a buyer or lessee to recover identified goods from a third party, such as a bailee, who is wrongfully withholding them.

Front 6

Tender of Delivery

Back 6

a seller’s or lessor’s act of placing conforming goods at the disposal of the buyer or lessee and providing whatever notification is reasonably necessary to enable the buyer or lessee to take delivery.

Front 7

What are the respective obligations of the parties under a contract for the sale or lease of goods?

Back 7

In the performance of a sales or lease contract, the basic obligation of the seller or lessor is to transfer and deliver conforming goods. The basic obligation of the buyer or lessee is to accept and pay for conforming goods in accordance with the contract.

Front 8

What is the perfect tender rule? What are some important exceptions to this rule that apply to sales and lease contracts?

Back 8

Under the perfect tender rule, the seller or lessor has an obligation to ship or tender conforming goods. If the goods or tender of delivery fails in any respect, the buyer or lessee has the right to accept the goods, reject the entire shipment, or accept part and reject part. Exceptions to the rule may be es­tab­lished by agreement.

When goods are rejected because they are nonconforming and the time for performance has not expired, the seller or lessor can notify the buyer or lessee promptly of the intention to cure and then do so within the contract time for performance. If the time for performance has expired, the seller or lessor can still cure within a reasonable time if, at the time of delivery, he or she had reasonable grounds to believe that the noncon­forming tender would be acceptable. When an agreed-on manner of delivery becomes impracticable or unavailable through no fault of ei­ther party, a seller may choose a commercially reasonable substitute.

Front 9

What options are available to the nonbreaching party when the other party to a sales or lease contract repudiates the contract prior to the time for performance?

Back 9

When repudiation occurs, the nonbreaching party may (1) treat the repudia­tion as a final breach by pursuing a remedy or (2) wait and hope that the repu­diating party will decide to honor the obligations required by the contract de­spite the ex­pressed intention to renege. In either situation, the nonbreaching party may suspend performance.

Front 10

What remedies are available to a seller or lessor when the buyer or lessee breaches the contract? What remedies are available to a buyer or lessee if the seller or lessor breaches the contract?

Back 10

Depending on the circumstances at the time of a buyer’s or lessee’s breach, a seller or lessor may have the right to cancel the contract, withhold delivery, resell or dispose of the goods subject to the contract, recover the purchase price (or lease payments), re­cover damages, stop delivery in transit, or reclaim the goods.

Similarly, on a seller’s or lessor’s breach, a buyer or lessee may have the right to cancel the contract, recover the goods, obtain specific performance, obtain cover, replevy the goods, recover damages, reject the goods, withhold delivery, resell or dispose of the goods, stop delivery, or revoke acceptance.

Front 11

In contracts subject to the UCC, are parties free to limit the remedies available to the nonbreaching party on a breach of contract? If so, in what ways?

Back 11

The answer to the first question is yes. A seller and buyer can expressly pro­vide for remedies in addition to those provided in the UCC. They can also pro­vide for remedies in lieu of those provided in the UCC, or they can change the measure of damages. A contract may also limit or exclude consequential dam­ages, so long as the limitation is not unconscionable.