NM Bar Contracts & Commercial Law 3

Question 1

Which UCC warranty is automatically implied in every sale of goods by a merchant who deals in goods of that kind?

Accepted Answer

Warranty of merchantability

Answer

Warranty of fitness for a particular purpose

Answer

Express warranty

Answer

Warranty of title

Question 2

Under New Mexico law, which of the following constitutes adequate consideration?

Accepted Answer

A peppercorn promised in exchange for a deed to real property

Answer

A promise to perform a pre-existing legal duty

Answer

A promise of a gift

Answer

Past consideration for a new promise

Question 3

Under the doctrine of commercial impracticability (UCC § 2-615), a seller is excused from performance when:

Accepted Answer

An unforeseen contingency occurs whose non-occurrence was a basic assumption of the contract

Answer

Performance becomes more expensive than anticipated

Answer

The buyer refuses to cooperate with delivery

Answer

The market price drops after contract formation

Question 4

A third-party beneficiary who is an intended beneficiary may enforce a contract:

Accepted Answer

Once the beneficiary's rights have vested

Answer

Only if the contract is in writing

Answer

Only after the promisee has attempted to enforce the contract

Answer

Regardless of whether the contract was formed with the beneficiary in mind

Question 5

Under common law, substantial performance by a contractor entitles the contractor to:

Accepted Answer

The contract price minus damages for the deviation from complete performance

Answer

The full contract price without any deduction

Answer

Nothing, because only perfect performance triggers payment

Answer

Restitution only, not the contract price

Question 6

The UCC's implied warranty of fitness for a particular purpose arises when:

Accepted Answer

The seller knows the buyer's particular purpose and the buyer relies on the seller's skill to select suitable goods

Answer

The seller is a merchant who deals in goods of the kind sold

Answer

The buyer specifies the exact goods to be purchased

Answer

The parties expressly agree to include such a warranty

Question 7

In New Mexico, which of the following agreements is enforceable without consideration under the UCC?

Accepted Answer

A merchant's written firm offer to keep an offer open

Answer

A promise to make a gift

Answer

An oral promise to pay a time-barred debt

Answer

A modification of a real estate sales contract