Sales Law

November 17, 2009Winn

Sales Law November 17• Website updates

– Amazon.com Certification– Earth Island Institute boycott of federal certification mark– ISO 9000 Quiz Results– 11/17 revised reading assignments

• Tuesday 11/17 Class– More complete analysis of ISO 9000 problem– Problems through 3-10?

• Thursday 11/19– Watch Monty Python Dead Parrot Sketch on Youtube and identify

the UCC Article 2 issue– Finish Chapter 3– Problems 4-1 and 4-2– Introduction to Supply Chains handout

Conrad Consumer v. Speedy Quality Assurance• If Speedy Quality Assurance was negligent in performing the

certification– Nautical’s documents did not match Nautical’s processes– If Speedy Quality Assurance had met its duty of workmanlike services, it

would have noticed and denied certification, and Wyndham would have terminated Nautical as a supplier

• And if the breach of duty caused the harm to Conrad Consumer– Bad manufacturing practice at Nautical caused manufacturing defect in float

switch which caused malfunction, and– But there was no way inspection by Wyndham could have detected defect,

and– Proper certification would have caused bad manufacturing practice to be

noticed and corrected, eliminating the defect, and– Conrad had kept the boat clean as required and did not otherwise

contribute to the problem• Then Conrad might be able to recover damages from Speedy Quality

Assurance

Void versus Voidable Title• Good Title

– Buyer cannot be forced by anyone to surrender goods due to superior claim of ownership

– Warranty of good title implied in law, absolutely explicit disclaimer required, nothing less works• Compare: basis of bargain must be disclaimed explicitly, cannot be disclaimed with

general disclaimers

• Voidable Title– Buyer has superior title to everyone in the world except former owner

• Bought jewelry from jewelry shop but rightful owner only “entrusted” for repairs—only rightful owner can “avoid” the transfer to the buyer

• Minor child enters into an unenforceable contract selling an asset, has option to “affirm” contract upon majority or to “avoid” it and reclaim goods

– If Buyer sells to “good faith purchaser for value” then GFP gets good title• Void Title

– Buyer has mere possession, must surrender goods under many circumstances• Thief stole goods from rightful owner, police can always recover possession for rightful

owner from buyer or buyer’s buyer, etc.