DE Bar Contracts and Sales 2 — Questions and Answers
Question 1: A merchant sends a signed written offer to sell goods, stating it will remain open for 60 days. Under UCC Article 2, how long is the offer irrevocable without consideration?
- 60 days as stated (Correct answer)
- A maximum of 90 days
- Only 30 days regardless of the stated term
- It is revocable at any time without consideration
Correct answer: 60 days as stated
A merchant's signed firm offer under UCC 2-205 is irrevocable for the stated period, capped at three months, so a 60-day term is fully enforceable.
Question 2: A buyer accepts a seller's offer for goods but adds a term requiring arbitration. Both parties are merchants. Under UCC 2-207, the arbitration term becomes part of the contract unless which of the following occurs?
- The offer expressly limits acceptance to its terms or the term materially alters the contract (Correct answer)
- The seller ships the goods before responding
- The buyer fails to sign the acceptance
- The term is not repeated in a confirming memo
Correct answer: The offer expressly limits acceptance to its terms or the term materially alters the contract
Between merchants, additional terms enter the contract unless the offer limits acceptance, the term materially alters the deal, or the offeror timely objects.
Question 3: A homeowner promises to pay a painter $5,000 after the painter has already finished painting the house as a volunteer. Is the promise enforceable under traditional contract law?
- No, because past consideration is not valid consideration (Correct answer)
- Yes, because the painter conferred a benefit
- Yes, because the promise was in writing
- No, because painting is a service, not goods
Correct answer: No, because past consideration is not valid consideration
Past consideration cannot support a new promise because the bargained-for exchange element is missing.
Question 4: A seller repudiates a contract for the sale of widgets before the delivery date. Which remedy is NOT available to the buyer under the UCC?
- Punitive damages for the repudiation (Correct answer)
- Cover by purchasing substitute goods and recovering the difference
- Market-price damages measured when the buyer learned of the breach
- Specific performance if the goods are unique
Correct answer: Punitive damages for the repudiation
Punitive damages are generally unavailable for breach of contract, while cover, market damages, and specific performance for unique goods are all UCC remedies.
Question 5: An uncle promises his nephew $10,000 if the nephew refrains from drinking and gambling until age 21, and the nephew complies. Why is the nephew's forbearance valid consideration?
- Giving up a legal right constitutes a bargained-for detriment (Correct answer)
- The uncle received an economic benefit
- Family promises are automatically enforceable
- The promise was morally binding
Correct answer: Giving up a legal right constitutes a bargained-for detriment
Forbearance from a legal right, as in Hamer v. Sidway, is a legal detriment that satisfies the consideration requirement.
Question 6: A contract for the sale of a rare painting for $400 is oral. The buyer sues to enforce it. What is the best analysis under the Statute of Frauds?
- It is enforceable because goods contracts under $500 need no writing (Correct answer)
- It is unenforceable because all art sales must be written
- It is enforceable only if the seller admits the contract in court
- It is unenforceable because unique goods require a writing
Correct answer: It is enforceable because goods contracts under $500 need no writing
UCC 2-201 requires a writing only for sales of goods priced at $500 or more, so a $400 oral sale is enforceable.
Question 7: A buyer receives non-conforming goods and rejects them within a reasonable time. What duty does a merchant buyer have regarding the rejected goods if the seller has no local agent?
- Follow reasonable seller instructions and, absent instructions, make reasonable efforts to sell perishable goods (Correct answer)
- Return the goods immediately at the buyer's own expense
- Destroy the goods to avoid storage fees
- Keep the goods as a setoff against damages
Correct answer: Follow reasonable seller instructions and, absent instructions, make reasonable efforts to sell perishable goods
Under UCC 2-603, a merchant buyer must follow the seller's reasonable instructions and salvage perishable goods when the seller lacks a local agent.
DE Bar Contracts and Sales 2
A merchant sends a signed written offer to sell goods, stating it will remain open for 60 days.
Under UCC Article 2, how long is the offer irrevocable without consideration?