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Clemson - LAW 3220 - Law 3220 Week 11 Notes - Class Notes

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Schools > Clemson University > Law > LAW 3220 > Clemson - LAW 3220 - Law 3220 Week 11 Notes - Class Notes

Clemson - LAW 3220 - Law 3220 Week 11 Notes - Class Notes

School: Clemson University
Department: Law
Course: Legal Environment of Business
Professor: John Hine
Term: Spring 2017
Tags: Law and businesslaw
Name: Law 3220 Week 11 Notes
Description: These notes cover material that will be on Test 4
Uploaded: 11/05/2017
This preview shows pages 1 - 3 of a 8 page document. to view the rest of the content
background image Law 3220:
Week 11 Notes
Chapter 11: Sales Uniform Commercial Code (UCC) Article 2 governs law of commercial 
sale of goods
Goods – things you can pick up and move Merchants – people engaged in business Most states have adopted Article 2 Purpose: designed to promote business o Sale of goods by merchants
o Does not apply to anything else
More flexible than common law o Contract can be formed in any manner than shows  agreement between the parties o Parties must act in good faith 
o If a term is missing, look at previous dealings between 
parties or trade practice o An offer can be withdrawn before it is accepted unless it is  a firm offer Firm Offer: “this offer is good for 2 weeks” specified 
period of time
Can only be withdrawn after time is up Terms o Some contracts are mixed (goods and services), still  covered by article 2 o $500 or more, contract has to be in writing
o Price: if you leave out the price, you assume fair market 
value  o Quantity: if left out, then: Requirements contract: what does the buyer require? Output contract: buyer says they will take whatever 
the seller can produce (whatever is produced by the 
seller at the time of the contract
o Delivery Terms: if left out, assume a reasonable period of  time or look to trade practice How long does it take the seller to produce the 
product
o Payment terms: if left blank, the amount of time needed to  pay for the items (30-60 days after the items are delivered 
to you)
Pay early = discount  Forming a Contract
background image Statute of Frauds and Parole Evidence Rule Parole Evidence Rule: cannot introduce oral evidence that 
contradicts the contract
o Can be used to clarify or fill in a gap in a written contract Filling in the Gaps Sellers and Buyers Basic Obligations Deliver goods in accordance with the contract Pay for goods in accordance with the contract Buyers have the right to inspect the goods o If items are good, pay for them
o It not, the buyer should notify the buyer of what they are 
going to do Accept all goods Reject all goods Buyer can accept those that are good and reject 
those that are bad
If any goods are rejected, the seller must be 
notified to be able to fix the problem 
Sales Warranties – Express and Implied If a warranty is given, it creates a contract Seller warranting something to the buyer
1. Implied Warranty: exists in every warranty regardless of what 
the contract says (good clear title) law imposes this warranty 2. Express Warranty:  a. Promise or fact made to the buyer concerning the goods
b. Description of the goods the seller made to the buyer
c. Sample or model of the goods provided to the buyer
3. Implied Warranty of Merchantability: product must be fit for  use in the buyers business 4. Warranty of Fitness for a Particular Purpose: if the buyer is  reliant on the sellers knowledge and expertise on the product a. Seller assure the product is fit for the purpose that the  buyer wants to use it for b. Relies on seller for knowledge of product Warranty Disclaimers Disclaimer must be in clear and conspicuous language Buyer must have signed the contract Buyer agreeing to waive one or two of the warranties o Seller might give you a discount 
background image o Shouldn’t waive any of the warranties  Remedies and Damages Notify the breaching party, they consider the contract cancelled  If the buyer breaches, seller can take the items back Seller can sue buyer for not being able to find another buyer o Put the seller back in the same economic status they were  before the contract was breached  Does not provide recovery of legal costs If the seller breaches, the buyer can recover any deposits or 
prepayments they have made
If buyer lost profits, they can recover o Not punitive damages however, malicious conduct can  result in the courts rewarding punitive damages International Sales Get a written contract In the contract, the parties should agree on how they will resolve 
disputes
o Arbitration is preferred CONVENTION? Chapter 13: Negotiable Instruments, Credit, and Bankruptcy Negotiable Instruments Functions: used as a substitute to cash and way to expand your 
business (not everyone has to use cash to pay you)
Negotiability: legal term that means you can transfer an 
instrument and get value for it (checks are most common)
Requirements: o 1. Written Instrument
o 2. Unconditional order or promise to pay
o 3. Signed by the maker or drawer
o 4. Payable on demand or at a specified time
o 5. Made out to the order of or to the bearer (bearer says 
“pay to bearer”, anybody who gets their hands on the 
check, not necessarily who you meant it to go to)
o 6. Has to have a certain amount of money
o Defenses:
Fraud Undue diress  o Holder in due course = no defenses Have to give value

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School: Clemson University
Department: Law
Course: Legal Environment of Business
Professor: John Hine
Term: Spring 2017
Tags: Law and businesslaw
Name: Law 3220 Week 11 Notes
Description: These notes cover material that will be on Test 4
Uploaded: 11/05/2017
8 Pages 43 Views 34 Unlocks
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  • 24/7 Homework help
  • Notes, Study Guides, Flashcards + More!
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