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sales product

BUS 205 chapter 12 sales and product liability

How was commercial law developed? in 1952, the Uniform Commercial code was published by a group of scholars with a goal to draft a modern law of commerce
UCC Uniform Commercial Code
Article 2 applies to the sale of goods, things that are movable (other than money and investment securities)
Article 2a this article governs the leasing of goods
Merchants someone who routinely deals in the particular goods involved, or who appears to have special knowledge or skill in those goods, or who uses agents w/ special knowledge or skill in those goods. (UCC holds a higher standard)
Formation Basics 3 rules: 1. the parties may make a contract in any manner that sufficiently shows that they reached an agreement 2. knowing the moment of making the contract isn't critical 3. 1+ terms may be left open.
Statute of Frauds for sale of goods $500+ writing sufficient to indicate a contract or signed by defendant, incorrect or omitted terms enforced by court, enforceable only to quality stated in writing
Merchant Exception of Oral contract occurs when: one sends a confirming memo w/in reasonable time, and the memo is definite could be enforced against the sender, then the memo is also valid against the merchant who receives (unless objected in 10 days)
Added terms to UCC if intended to accept and change or add terms to a contract, contract is valid
Different terms these terms contradict terms in the offer and cancel each other out if there is no clear agreement the code supplies its own terms
additional terms these terms raise issues not covered in the offer. they generally become part of the bargain
Buyer's Remedies conforming goods satisfy the contract terms. the buyer has the right to inspect the goods before paying or accepting. may reject non-conforming goods, but seller has right to cure
Cover a buyer's remedy that if the seller breaches, the buyer may cover by reasonably obtaining substitute goods. buyer may obtain difference b/w contract price and cover price plus incidental and consequential damages
Incidental and consequential damages any injured buyer is generally entitled to these damages
Seller's Remedies may stop or refuse delivery, may recover difference b/w resale price and contract price +incidential damages -expenses saved may recover if buyer has accepted goods,or goods conforming
Product Liability when goods cause injury. three issues. 1. warranty-a contractural assurance goods will meet standards 2. negligence- unreasonable conduct by the defendant strict liability- policy which holds defendant liable
Express Warranty seller creates this warranty with words/actions, affirmation of fact, description of goods, or sample/model
Implied Warranties created by code itself. goods shall be merchantable,
Fitness for a Particular Purpose seller knows particular purpose for which buyer wants goods, implied warranty that the goods shall be fit for such purpose
Negligence cases: design, manufacture, or failure to warn, no remedy if disclaimers/or remedy limitations included
Strict Liability imposed if: defective condition is dangerous, seller is in the business, the product reaches user w/o change, even if seller exercised care,and there is no contract
Contemporary Trends to measure design and warning: consumer expectations, and risk-utility tests
Created by: rburciag



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