Commercial Law Quiz 1
Commercial Law Quiz: Test Your Knowledge
Welcome to the Commercial Law Quiz! This interactive quiz is designed to challenge your understanding of key concepts in commercial law through real-world scenarios.
Test your knowledge with questions covering:
- Contract formation
- Warranties and guarantees
- Legal implications of sales agreements
- Dispute resolution
- Intellectual property rights
Shelly and Barbie agreed during a long phone conversa"on that Shelly will design and build a custom shower chair for an agreed price. The chair was to be built to the specifica"ons of Barbie’s shower stall. When the work was almost complete (only pain"ng remained), Shelly contacted Barbie to arrange delivery date and method of payment. Barbie responded that she was able to purchase a chair on Amazon and no longer needed a custom chair. She also told Shelly that there is no contract formed because she did not sign any agreement, and did not receive any confirma"on from Shelly a$er their phone conversa"on. Is there an enforceable contract between Shelly and Barbie?
Yes, because an oral agreement for specially manufactured goods is enforceable where the seller has made substan"al progress in performance.
No, the contract was not in a signed wri"ng by Barbie.
Yes, because no wri"ng is required where the par"es are not both merchants.
No, because a wri"ng is required to enforce a contract against a non-merchant like Barbie.
In a telephone conversa"on, a jewelry maker offered to buy 100 ounces of gold from a precious metals company if delivery could be made within 10 days. The jewelry maker did not specify a price, but the market price for 100 ounces of gold at the "me of the conversa"on was approximately $65,000. Without otherwise responding, the company delivered the gold six days later. In the mean"me, the project for which the jewelry maker planned to use the gold was canceled. The jewelry maker therefore refused to accept delivery of the gold or to pay the $65,000 demanded by the company. Is there an enforceable contract between the jewelry maker and the company?
No, because the par"es did not agree on a price term.
No, because the par"es did not put their agreement in wri"ng.
Yes, because the absence of a price term defeats the forma"on of a valid contract for the sale of goods where the par"es otherwise intended to form a contract.
Yes, because the company relied on an implied promise to pay when it delivered the gold.
A buyer and a seller entered into a wri!en contract for the sale of a copy machine, using the same form contract that they had used a number of "mes in the past. The contract stated that payment was due 30 days a$er delivery and provided that the wri"ng contained the complete and exclusive statement of the par"es' agreement. On several past occasions, the buyer had taken a 5% discount from the contract price when paying within 10 days of delivery, and the seller had not objected. On this occasion, when the buyer took a 5% discount for paying within 10 days, the seller objected because his profit margin on this par"cular machine was smaller than on his other machines. If the seller sues the buyer for breach of contract, may the buyer introduce evidence that the 5% discount was a term of the agreement?
Yes, because a modifica"on made in good faith does not require considera"on.
Yes, because evidence of course of dealing is admissible even if the wri"ng contains the complete and exclusive agreement of the par"es.
No, because the wri"ng contained the complete and exclusive agreement of the par"es.
No, because the seller "mely objected to the buyer's proposal for different terms.
In a phone conversa"on, Sansa and Jamie agreed that Jamie will sell Sansa a sword made of valerian steel designed by the famous, John Snow. The purchase price of the sword was $5,000. Shortly a$er their phone conversa"on, John Snow disappeared during a hiking expedi"on in the Tollymore Forest (word is he was eaten by a Direwolf). This news of Snow’s disappearance caused a drama"c increase in the price of his valerian swords. As a result, Jamie has refused to deliver the sword to Sansa as agreed. During a court hearing, Jamie tes"fied: “yes, we had an agreement but unfortunately, it is not enforceable because it was not in a signed wri"ng.” Will the contract be enforced?
Yes, because the manufacturer is dead.
Yes, because Jamie admi!ed that they had a contract.
No, because Sansa did not send a confirma"on of their agreement.
No, because it was not in a wri"ng signed by Jamie.
A buyer purchased a new car from a dealer under a wri!en contract that provided that the price of the car was $20,000 and that the buyer would receive a "trade-in allowance of $7,000 for the buyer's old car." The old car had recently been damaged in an accident. The contract contained a merger clause sta"ng: "This wri"ng cons"tutes the en"re agreement of the par"es, and there are no other understandings or agreements not set forth herein." When the buyer took possession of the new car, she delivered the old car to the dealer. At that "me, the dealer claimed that the trade-in allowance included an assignment of the buyer's claim against her insurance company for damage to the old car. The buyer refused to provide the assignment. The dealer sued the buyer to recover the insurance payment. The dealer has offered evidence that the par"es agreed during their nego"a"ons for the new car that the dealer was en"tled to the insurance payment. Should the court admit this evidence?
No, because the merger clause bars any evidence of the par"es' prior discussions concerning the trade-in allowance.
No, because the dealer's acceptance of the old car bars any addi"onal claim by the dealer.
Yes, because a merger clause does not bar evidence of insurance issues.
Yes, because the merger clause does not bar evidence to explain what the par"es meant by "trade-in allowance."
A buyer sent a seller an offer to buy 50 tons of co!on of a specified quality. The offer contained no terms except those specifying the amount and quality of the co!on. The seller then sent an acknowledgment by fax. The acknowledgment repeated the terms of the buyer's offer and stated that shipment would occur within five days. Among 12 printed terms on the acknowledgment was a statement that any dispute about the co!on's quality would be submi!ed to arbitra"on. Neither the buyer nor the seller said anything further about arbitra"on. The seller shipped the co!on, and it was accepted by the buyer. A dispute arose between the buyer and the seller as to the quality of the co!on, and the seller asserted that the dispute had to be submi!ed to arbitra"on. The buyer instead sued the seller in court. In that suit, which of the following arguments best supports the seller's posi"on that the buyer must submit the dispute to arbitra"on?
The provision for arbitra"on did not materially alter the par"es' contract.
The provision for arbitration did not contradict any term in the buyer's offer.
The seller's acknowledgment containing a provision for arbitra"on cons"tuted a counteroffer that was accepted by the buyer when it accepted delivery of the co!on.
Arbitraton is a more efficient method of resolving disputes than resolving them in court.
A farmer contracted to sell 100,000 bushels of wheat to a buyer. When the wheat arrived at the des"na"on, the buyer discovered that the farmer had delivered only 96,000 bushels. The buyer sued the farmer for breach of contract. At the trial of the case, the court found that the wri!en contract was intended as a complete and exclusive statement of the terms of the agreement. The farmer offered to prove that in the wheat business, a promise to deliver a specified quan"ty is considered to be sa"sfied if the delivered quan"ty is within 5% of the specified quan"ty. The buyer objected to the offered evidence. Is the court likely to admit the evidence offered by the farmer?
Yes, because the offered evidence demonstrates that the farmer substan"ally performed the contract.
Yes, because the offered evidence explains or supplements the agreement by usage of trade.
No, because the wri!en contract was totally integrated.
No, because the offered evidence is inconsistent with the express language of the agreement.
Brad broke into Angie’s house and stole a pain"ng called “Dreams of My Father.” Downtown Art Dealers bought the pain"ng from Brad unaware that it was stolen. Downtown sold the pain"ng to Sothebys. Angie hired a private detec"ve who was able to locate the pain"ng, which she demanded back from Sothebys. Can Angie reclaim the pain"ng from Sothebys?
Yes, the entrustment doctrine does not protect Sothebys because the pain"ng was stolen from Angie.
Yes, because Sotheby’s is not a bona fide purchaser.
No, because Angie and Sothebys are not in a contractual rela"onship and recission does not apply here.
No, because Sothebys bought the pain"ng in good faith without no"ce of the the$.
This ques"on is based on same facts as the previous ques"on, but the call of this ques"on is different. Brad broke into Angie’s house and stole a pain"ng called “Dreams of My Father.” Downtown Art Dealers bought the pain"ng from Brad unaware that it was stolen. Downtown sold the pain"ng to Sothebys. Angie hired a private detec"ve who was able to locate the pain"ng, which she demanded back from Sothebys. Is Sothebys en!tled to recover from Downtown Art Dealers?
No, because Downtown Art Dealers did not know the pain"ng was stolen.
Yes, Downtown Art Dealers breached the warranty of fitness for a par"cular purpose.
No. Sotheby is subject to the “Buyer Beware” doctrine.
Yes, Downtown Art Dealers breached the warranty of "tle.
Peter Griffin remodeled his basement and wanted to install a hea"ng unit. He was browsing the internet and saw an ad for the B-50 Hot Iron Hea"ng System. Cleveland Brown, Peter’s good friend, managed a nearby appliance store. So, Peter went to the appliance store, and told Cleveland that he wanted to purchase a hea"ng unit to keep the en"re area warm. Lucky for Peter, the store sold the B-50 Hot Iron System and Cleveland assured Peter that this heater will “do the job.” Peter bought the heater for his basement. Cleveland was familiar with the remodeled basement because he actually helped Peter with the remodeling project. When the heater was delivered to Peter, it worked, but was only able to heat the area around the stairs. The heater did not have the capacity to heat the en"re basement. Peter can sue Cleveland for:
Breach of the implied warranty of merchantability and breach of the implied warranty of fitness for a par"cular purpose.
Breach of an express warranty.
Breach of the warranty against infringement.
Breach of the implied warranty of merchantability only.
Don Draper walked into the Plaza Hotel in New York and ordered a mojito cocktail from the bar. As he sucked on one of the lime wedges, a seed from the lime wedge slid down his throat causing him to choke. Luckily, a doctor who was a patron at the hotel helped to loosen his "e and was able to expel the lime seed from his throat. Don later developed a throat infec"on, which caused him to be hospitalized. Since the accident, Don now speaks in a raspy voice. Does Don have a cause of ac"on against the Plaza Hotel?
No, because the seed is not a foreign object.
Yes, the implied warranty of merchantability was breached if Don reasonably expected the seeds to be removed from the lime wedges.
No, because Don assumed the risk when he ordered a mojito from a New York hotel.
Yes, because the hotel breached the implied warranty of merchantability.
On September 1, Fishco, a fish wholesaler, sent Neptune, the owner of a sushi restaurant located in Key West, the following signed le!er: " Have 400 pounds of large Gulf shrimp available at $2 per pound for October delivery. This offer will remain open for acceptance un"l October 1. Please reply if interested." On September 30, Neptune wired the following telegram to Fishco which was received the next day; "Please be advised that I hereby accept your offer dated September 1. However, I would appreciate you delivering 200 pounds in October and 200 pounds in November if you possibly can." Assume that Fishco delivered 200 pounds of shrimp to Neptune during October and 200 pounds of shrimp during November. However, 100 pounds of those delivered in November were not of merchantable quality. If Neptune accepts the shrimp knowing of their defec"ve condi"on, he probably has:
No remedy against Fishco, because the risk of loss falls on Neptune due to the perishable nature of the product.
No remedy against Fishco, because he waives whatever claim he may have by accep"ng the defec"ve shrimp.
A remedy against Fishco, provided he gives Fishco no"ce of the breach.
A remedy against Fishco whether or not he gives Fishco no"ce of the breach.
Daniel enters into a contract to paint Stacey’s house. When Stacey decides on a color, Daniel will buy the paint for a total cost of $200.00 and paint the house for the price of $2,500. This contract is governed by:
The Uniform Commercial Code governs because a sale of goods is involved.
Both the common law and the Uniform Commercial Code will govern this contract because the contract is divisible.
The common law of contracts because the predominant factor of the contract is for the performance of services and not for a sale of goods.
The common law of contracts because this is a mixed contract.
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