buslaw15-special rules sales contract

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1. Determine when to apply the law of salesunder the UCC.

2. Describe the special rules for sales

contracts.3. Explain the four exceptions to the rule

requiring contracts for the sale of goodscosting $500 or more to be in writing.

SALES AND LEASES OF

GOODS

Chapter Objectives:

Chapter 15



4. Judge, in a given situation, whether awriting satisfies the requirements of theUCC.

5. Contrast an auction with reserve with anauction without reserve.

6. Determine, in the case of a bulk transfer,whether the four requirements of the UCC

have been met.

SALES AND LEASES OF

GOODS

Chapter Objectives (continued):

Chapter 15



The Sale and Lease of Goods

Leases of Goods.

Computer InformationTransactions.

Contracts for Both Goods andServices.

1515--11



LawLINKS

Chapter 15Chapter 15

Look for UCC Article 2--Sales at

http://www.law.cornell.edu/ucc.table.html



LawLINKS


Check out UCC Article 2A--Leases at

http://www.cornell.edu/ucc.table.html



A Question of Ethics


You are aware from your study of Chapter 7 that two of the

advertisements mentioned in theopening case of this chapter areinvitations to deal rather than offersand are not binding on the advertiser.

How would you advise the twomerchants to deal with thedisappointed consumers from an

ethical point of view?



1515--11

1. Forty-nine states have adopted, either

in whole or in part, the UniformCommercial Code (UCC).

Topic Quiz

FALSE

Answer the following true/false questions:

All fifty states.



1515--11

3. The dominant element of a

contract determines whether it

is a sales contract or a services

contract.

Topic Quiz

TR UE




The Sales Contract

1515--22

A sales contract may be either a sale or a contract to sell.



1515--22

1. Every time anyone buys goods

and receives title to them, a

sale occurs.

Topic Quiz

TR UE




1515--22

2. A contract to sell, rather than a

sale, occurs when title is to

pass at some future time.

Topic Quiz

TR UE




1515--22

3. A gift is considered to be a sale.

Topic Quiz

FALSE


It is not a sale ± there was no price.



Special R ules for Sales Contracts

1515--33

Good Faith

Course of Dealings and Usage of Trade

Formation of a Sales Contract

Offer and Acceptance



Special R ules for Sales Contracts(continued)

1515--33

Firm Offer

Open-Price TermsOutput and Requirements

Terms

Additional Terms inAcceptance

Modification



1515--33

1. Under the UCC, a contract

comes into existence when the

acceptance is sent if the

method used is reasonable.

Topic Quiz

TR UE




1515--33

2. No consideration is necessary to

establish a firm offer when a consumerpromises in writing to hold an offer

open for the sale or lease of goods.

Topic Quiz

FALSE


Consideration is necessary.



1515--33

3. Under the UCC, a contract for

the sale of goods may be

established even though the

price is not settled.

Topic Quiz

TR UE




Form of Sales Contracts

1515--44

Exceptions to the GeneralRule.

Requirements of Writing.



1515--44

1. A lease of goods must be in writing if

the total payments to be made under thelease are $500 or more.

Topic Quiz

FALSE


$1000.



1515--44

2. Contracts for goods that havebeen received and accepted for

$500 or more need not be in

writing.

Topic Quiz

TR UE




1515--44

3. A required writing under the

UCC must indicate the

quantity of goods being sold.

Topic Quiz

TR UE




Auction Sales

1515--55

In an auction sale, the auctioneer presents goods for sale andinvites the audience to make

offers, which are known as bids.



Did You Know?

1515--55

The federal government auctions cars,trucks, real estate, airplanes, boats,

jewelry, office equipment, heavyequipment, and many other items. For information about government auctions,log onto the Internet and, using the

search engine Excite, type in the words³government auction.´ You may findsomething you need at a bargain price.



1515--55

1. In an auction sale, the auctioneer makes

offers to sell goods to members of theaudience.

Topic Quiz

FALSE


The auctioneer presents goods for sale,

and the audience makes offers to buy.



1515--55

2. In an auction sale ³without reserve,´

the auctioneer may withdraw the goodsat any time before announcing

completion of the sale.

Topic Quiz

FALSE


Goods may be withdrawn at any time only

in an auction ³with reserve.´



Bulk Transfers

1515--66

Any transfer of a major part of

the materials, supplies,merchandise, or other inventoryof an enterprise that is not in the

ordinary course of thetransferor¶s business.



1515--66

1. A bulk transfer is any transfer

of a major part of thematerials, supplies,

merchandise, or other

inventory of an enterprise thatis not in the ordinary course of

the transferor¶s business.

Topic Quiz

TR UE




1515--66

2. When there is a bulk transfer, the

transferee is required to furnish a list of creditors.

Topic Quiz

FALSE


The transferor is required to furnish a list

of creditors.



1515--66

3. Creditors must be notified at least 7

days before a bulk transfer takes place.

Topic Quiz

FALSE


Ten days.



1515--11 The Uniform Commercial Code (UCC)which contains the law of sales, has been

adopted, either in whole or in part, by every

state in the United States.

A sales contract may be either a sale or a

contract to sell.

1515--22

There are special rules that are differentfrom general contract law that apply to

sales contracts.

1515--33

SUMMAR Y



1515--44 With four exceptions, a contract for the sale

of goods for $500 or more and the lease of

goods for $1,000 or more must be in writing.

In an auction sale, offers are made by the

people in the audience. The acceptance

takes place when the auctioneer bangs the

gavel.

1515--55

SUMMAR Y(continued)

To protect creditors from losing access to

goods, creditors must be notified at least ten

days before a bulk transfer takes place.

1515--66




Key Termsauction without reserve auction with reserve

bulk transfer computer information

conforming goods contract to sell

Convention on Contracts for the International Sale of Goods (CISG)

firm offer future goods

goods merchant

nonconforming goods open-price termsoutput contract requirements contract

transactions in computer information sale

Uniform Commercial Code usage of trade



Investigating on the Internet


Log onto the Uniform Commercial CodeLocator at

http://www.law.cornell.edu/uniform/ucc.html

This links to state statutes thatcorrespond to Articles of the UCC. Findthe statutory location of UCC Articles 2and 2A in your state. Check, also, tosee if there are any proposed revisions

of the articles.



End of Presentation

buslaw15-special rules sales contract

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