ACCT Notes Chapter 24 and 25
ACCT Notes Chapter 24 and 25 ACCT 324 - 002
Popular in Survey of Commercial Law
Popular in Accounting
This 2 page Class Notes was uploaded by Kendall Davis on Monday September 19, 2016. The Class Notes belongs to ACCT 324 - 002 at University of South Carolina taught by Julius David Johnson (P) in Fall 2016. Since its upload, it has received 5 views. For similar materials see Survey of Commercial Law in Accounting at University of South Carolina.
Reviews for ACCT Notes Chapter 24 and 25
Report this Material
What is Karma?
Karma is the currency of StudySoup.
You can buy or earn more Karma at anytime and redeem it for class notes, study guides, flashcards, and more!
Date Created: 09/19/16
Chapter 24: Remedies for Breach of Sales and Lease ContractsSeptember 19 Breach by the Buyer Breach by the buyer usually failure to pay When buyer is in breach, seller can: o Cancel contract o Withhold delivery o Sell or otherwise dispose of goods If you sell the goods, and you do not get the contract price, you can sue for the difference o Sue to recover purchase price, lease payments due, or some other measure of damages that give seller/lessor “benefit of bargain” Liquidated Damages Liquidated damages: damages specified in contract before breach occurs o Usually specified in the contract o Court will only enforce the clause if it is “reasonable” and “nonpunitive” o Has to be in writing If not in writing, the UCC allows nonbreaching seller to claim against breaching buyer 20% of the purchase price OR $500, whichever is less Breach by the Seller Fails to deliver goods or fails to follow perfect tender rule Remedies Available to Buyers: o Cancel contract o Obtain “cover” (Substitute goods) Go out in the market and find replacement goods In order to obtain legal “cover”: Demonstrate “good faith” Pay a reasonable price (or sue for the difference) Act without “unreasonable delay” Purchase goods that are reasonable substitutes o Sue to recover damages o Recover goods o Obtain specific performance by court When the subject is “unique” or land o Reject nonconforming goods o Revoke acceptance of nonconforming goods o Accept nonconforming goods and seek damages Modification/Limitations to Remedies otherwise provided by UCC o Parties to sales and lease contracts are allowed to modify/limit remedies o Courts uphold modifications/limitations to remedies, unless remedies fail in their “essential purpose” Chapter 25Warranties Warranty: sellers promise regarding certain characteristics of good(s) sold o Express Warranty: explicitly stated in contract Commercials, advertisements and brochures Description of good’s physical nature or its use May be found in advertisements or brochures May be material term of contract Salesperson’s oral promise concerning good can give rise to express warranty Buyer’s reliance on seller’s representations generally means those representations become express warranties, and thus part of contract o Implied warranty: automatically (by operation of law) applied to contract o Puffery: salesperson’s mere statement of opinion, rather than representation of facts Generally does not create express warranty Ex: the best watch on the market
Are you sure you want to buy this material for
You're already Subscribed!
Looks like you've already subscribed to StudySoup, you won't need to purchase another subscription to get this material. To access this material simply click 'View Full Document'