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25 Cards in this Set

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WORDS OF THE PARTIES
Intro card
What does the Parol Evidence rule operate to do?
It keeps out evidence of a prior agreement (oral or written) that contradicts a later writing. Policy is to respect a later writing.
What's the difference between SOF and PER?
1. PER problem requires a writing.
2. SOF problem entails an oral agreement (and whether it's enforceable).
What are the exceptions to the PER?
1. To correct clerical error
2. Establish defense against formation of a K (mistake)
3. To explain or interpret the written K
4. Supplement a partially-integrated writing (such as the later writing that doesn't appear complete on its face)
What's a "merger clause"?
Ex. A written lease says "This K is limited to the terms set forth herein." Signifies that the writing can't be supplemented.
Does PER have anything to do with what happens AFTER an agreement has been reduced to writing?
No, the rules on modification apply. PER looks backward, not forward.
Conduct of the Parties (from most to least important)
1. Course of Performance - what the parties have done under this K
2. Course of dealing - what the parties have done under their earlier Ks with one another.
3. Usage of trade - what others in the trade do under similar circumstances
Under Art 2, what are examples of a Seller's warranties of quality?
1. Express warranties
2. Implied warranty of merchantibility
3. Implied warranty of fitness for the buyer's particular purpose
What is and is not included in an express warranty?
Included: statements of fact, promises, and descriptions of the goods
Not included: mere expressions of opinion
Definition (and key to remember) of implied warranty of merchantibility?
Goods are fit for their ordinary purpose.
Key: S is a merchant who deals in goods of the kind b/c this is associated with special knowledge about the particular goods involved.
Definition (and key to remember) of fitness for the buyer's particular purpose?
The goods are fit for the buyer's particular purpose.
S must know/have reason to know that B has special purpose & is relying on S to select suitable good (S doesn't have to be a merchant!)
What are the limitations on Warranty Liability in a Sale of Goods Contract?
1. Contractual limitations
2. Privity of contract
Examples of contractual limitations?
1. Disclaimer: S can disclaim implied (not express) warranties.
How can S disclaim implied warranties?
Through "as is" or "with all faults."
What if S doesn't use "as is" or "with all faults"?
Without those magic words, the disclaimer must be conspicuous through bold face, different type font, etc.
What are the elements of Limitatiosn of Remedies?
1. Doesn't eliminate any warranty, just limits recovery for breach
2. Can even limit remedies for breach of an express warranty
What is the TEST for the limitation of remedies?
Judge test: unconscionability. With consumer goods, limiting B's remedies for personal injury is presumed to be unconscionable.
Privity of K is also a limitation on warranty liability.
In TX, the court decides if the warranty extends to a 3rd party.
RISK OF LOSS (ROL) FOR SALE OF GOODS K
Into Card
When goods are lost or damaged w/o fault of either B or S, who bears the ROL?
1. If S bears the risk, S must provide new goods to B at no additional cost or be liable for damages for breach of K.
2. If B bears the risk, B must still pay S the full K price
Lay out the hierarchy determining who bears the ROL (top to bottom)
1. Agreement of the parties controls.
2. Breach: breaching party is liable, even if loss is unrelated to the breach
3. Delivery by common carrier: ROL shifts to
B when S completes its delivery obligations.
4. If delivery not by common carrier, the answer depends on whether S is a merchant.
Under a shipment K, when is delivery obligation complete under common carrier?
S must get the goods to a common carrier, make reasonable delivery arrangements, and let B know. That's it.
Under a destination K, when is delivery obligation complete under common carrier?
S must get the goods to destination of the B.
If the K provides for FOB (free on board) followed by the name of a city, how do you determine if a shipment K or destination K?
1. If name of the city is where the S is located, the K is a shipment K.
2. If name of the city is 'any other city' then K is a destination K.
Under the "whether S is a merchant" for ROL, what are the rules?
1. If S is merchant, S bears ROL until B takes possession (b/c S in better position to insure against ROL)
2. If S is non-merchant, ROL shifts when S "tenders" the goods.