Podcast
Questions and Answers
Under common law, which of the following is required for an offer to be validly accepted?
Under common law, which of the following is required for an offer to be validly accepted?
- The acceptance must be communicated within 30 days.
- The acceptance must reflect the offer exactly, without any modifications. (correct)
- The acceptance must be in writing to be valid.
- The acceptance can include minor modifications as long as they don't materially alter the terms.
What is the result if an acceptance under common law does NOT exactly mirror the offer?
What is the result if an acceptance under common law does NOT exactly mirror the offer?
- It constitutes a counteroffer. (correct)
- It is considered a rejection of the original offer only if explicitly stated.
- It automatically voids the entire transaction.
- It is a valid acceptance if the changes are minor.
Under the UCC, when a contract is formed through conduct even though the acceptance doesn't perfectly mirror the offer, which terms usually apply?
Under the UCC, when a contract is formed through conduct even though the acceptance doesn't perfectly mirror the offer, which terms usually apply?
- The terms of the offer always prevail.
- The terms that both parties agree on, supplemented by UCC gap-fillers. (correct)
- The terms of the acceptance always prevail.
- The terms are decided by a coin toss.
A farmer offers to sell 100 apples for $100 with payment due by December 15 at 9 am. The buyer accepts but specifies payment by 1 pm on December 15. Under common law, what is the status of the agreement?
A farmer offers to sell 100 apples for $100 with payment due by December 15 at 9 am. The buyer accepts but specifies payment by 1 pm on December 15. Under common law, what is the status of the agreement?
In what situation would the 'last shot rule' typically apply?
In what situation would the 'last shot rule' typically apply?
Under the UCC, when does Section 2-207 change the common law mirror image rule?
Under the UCC, when does Section 2-207 change the common law mirror image rule?
What is the primary purpose of UCC Section 2-207?
What is the primary purpose of UCC Section 2-207?
Under the UCC, if parties intend to create a contract but fail to specify the price, what happens?
Under the UCC, if parties intend to create a contract but fail to specify the price, what happens?
If a contract for the sale of goods is missing a delivery term, what does the UCC presume about the place of delivery?
If a contract for the sale of goods is missing a delivery term, what does the UCC presume about the place of delivery?
Under the UCC, what is the default time for delivery if not specified in the contract?
Under the UCC, what is the default time for delivery if not specified in the contract?
According to the UCC, if the time for payment is not specified in a contract, when is payment due?
According to the UCC, if the time for payment is not specified in a contract, when is payment due?
If parties agree to a contract, and the acceptance contains additional terms, what is the status of those additional terms if the parties are NOT merchants?
If parties agree to a contract, and the acceptance contains additional terms, what is the status of those additional terms if the parties are NOT merchants?
When do additional terms in an acceptance automatically become part of a contract under UCC Section 2-207?
When do additional terms in an acceptance automatically become part of a contract under UCC Section 2-207?
Under the UCC, which of the following scenarios would prevent additional terms included in the acceptance from becoming part of the contract between merchants?
Under the UCC, which of the following scenarios would prevent additional terms included in the acceptance from becoming part of the contract between merchants?
What does it mean for an additional term to 'materially alter' a contract, preventing it from becoming part of the agreement under the UCC?
What does it mean for an additional term to 'materially alter' a contract, preventing it from becoming part of the agreement under the UCC?
In a transaction between merchants, what action can an offeror take to prevent any additional terms included in the acceptance from becoming part of the contract?
In a transaction between merchants, what action can an offeror take to prevent any additional terms included in the acceptance from becoming part of the contract?
A farmer who occasionally sells excess produce is dealing with a large grocery chain on a contract for the sale of goods. How are additional terms in the grocery chain's acceptance treated?
A farmer who occasionally sells excess produce is dealing with a large grocery chain on a contract for the sale of goods. How are additional terms in the grocery chain's acceptance treated?
In a UCC 'battle of the forms' scenario, what do some states apply to resolve the conflicting terms in the offer and acceptance?
In a UCC 'battle of the forms' scenario, what do some states apply to resolve the conflicting terms in the offer and acceptance?
ACME Corp. offers Wiley Corp. toy trains with a clause requiring claims to be filed within one year. Wiley's purchase order states claims can be filed within three years. Both parties are merchants. Which rule applies in most states to resolve this conflict?
ACME Corp. offers Wiley Corp. toy trains with a clause requiring claims to be filed within one year. Wiley's purchase order states claims can be filed within three years. Both parties are merchants. Which rule applies in most states to resolve this conflict?
How have courts interpreted “reasonable time” with respect to UCC gap fillers.
How have courts interpreted “reasonable time” with respect to UCC gap fillers.
Farmer MacDonald delivers organic apples to Whole Foods Market. Whole Foods adds a clause to its acceptance requiring MacDonald to indemnify it for any damages to consumers. Which of the following is true?
Farmer MacDonald delivers organic apples to Whole Foods Market. Whole Foods adds a clause to its acceptance requiring MacDonald to indemnify it for any damages to consumers. Which of the following is true?
Fred sends Bill an offer to purchase widgets for $10 a piece, FOB Fred’s factory. Bill accepts in writing. Bill further notes on the acceptance that he only has to pay if he is satisfied with the widgets. Assume that Fred and Bill are both merchants. What is true?
Fred sends Bill an offer to purchase widgets for $10 a piece, FOB Fred’s factory. Bill accepts in writing. Bill further notes on the acceptance that he only has to pay if he is satisfied with the widgets. Assume that Fred and Bill are both merchants. What is true?
True or false. The UCC will impose a price even when one is missing from the agreement.
True or false. The UCC will impose a price even when one is missing from the agreement.
Which of the following parties is least likely to be deemed a “merchant” under the UCC.
Which of the following parties is least likely to be deemed a “merchant” under the UCC.
Flashcards
Mirror Image Rule
Mirror Image Rule
Under common law, an offer must be accepted exactly without any modifications.
Counteroffer
Counteroffer
If an acceptance doesn't mirror the offer exactly, it's considered a rejection and a new offer.
The UCC
The UCC
A set of laws governing commercial transactions in the United States, aiming for uniformity across states.
Merchant
Merchant
Signup and view all the flashcards
UCC 2-207
UCC 2-207
Signup and view all the flashcards
Last Shot Rule
Last Shot Rule
Signup and view all the flashcards
Mirror Image Rule
Mirror Image Rule
Signup and view all the flashcards
Performance Despite Difference
Performance Despite Difference
Signup and view all the flashcards
UCC 2-207
UCC 2-207
Signup and view all the flashcards
Last Shot Rule
Last Shot Rule
Signup and view all the flashcards
Missing Contract Terms
Missing Contract Terms
Signup and view all the flashcards
UCC Gap Fillers
UCC Gap Fillers
Signup and view all the flashcards
Additional Terms (Non-Merchants)
Additional Terms (Non-Merchants)
Signup and view all the flashcards
Additional Terms (Merchants)
Additional Terms (Merchants)
Signup and view all the flashcards
Reasons Additional Terms Don't Apply
Reasons Additional Terms Don't Apply
Signup and view all the flashcards
Non-Merchant Extra Terms
Non-Merchant Extra Terms
Signup and view all the flashcards
Merchant Extra Terms
Merchant Extra Terms
Signup and view all the flashcards
Contract with Non-Merchant Condition
Contract with Non-Merchant Condition
Signup and view all the flashcards
Knock-Out Rule
Knock-Out Rule
Signup and view all the flashcards
UCC Gap Filling Provision
UCC Gap Filling Provision
Signup and view all the flashcards
Study Notes
- UCC stands for Uniform Commercial Code
- The Battle of the Forms refers to which contract terms apply when acceptance doesn't mirror the offer
Common Law Mirror Image Rule
- Under the common law, an offer must be accepted exactly with no modifications
- If the acceptance is not an exact mirror of the offer, it is considered a counteroffer
- A counteroffer implies a rejection of the original offer, coupled with a new offer
The Last Shot Rule
- According to the mirror image rule, the terms of the last document exchanged, would control the contract
The UCC and Merchants
- A merchant is someone who regularly deals in the kind of goods involved in the transaction
- Merchants are sophisticated, regular buyers or sellers of goods
Section 2-207 of the UCC
- A definite and seasonable expression of acceptance operates as an acceptance even though it states terms additional to or different from those offered or agreed upon
- Acceptance is expressly made conditional on assent to the additional or different terms
Mirror Image Rule vs. Last Shot Rule
- The mirror image rule says that an acceptance that doesn't mirror the offer is a counteroffer
- If both parties perform then a contract is formed
- The terms are governed by the last shot rule
UCC and Mirror Image Rule
- The UCC does not follow the mirror image rule
- Section 2-207 was adopted to get rid of the rigid and unfair "last shot rule"
- Terms of the last exchanged document before performance control the contract
- This applies even if merchants aren't paying attention to minor terms
Missing Terms
- The UCC fills in the gaps regarding missing terms
Missing Terms and Gap Fillers
- Open price: reasonable price at the time of delivery
- Open delivery: buyer picks up at seller's location (2-308(a))
- Open time for delivery: reasonable time (2-309(1))
- Open time for payment: time and place at which the buyer receives the goods (2-310)
Additional Terms: Non-Merchants
- When parties agree to a contract, the acceptance contains additional terms
- If the parties are not merchants, additions in an acceptance serve as proposals for an addition to the contract
- Additional terms require assent by the offeror
- The farmer is not bound by new terms, unless he agrees based on Section 2-207(2)
Additional Terms: Merchants
- If the parties are merchants, additional terms in acceptance automatically become part of the contract unless one of the following applies per Section 2-207(2):
- The offer expressly limits acceptance to the terms of the offer
- The addition materially alters the contract
- Notification of an objection to the additional term is given within a reasonable time
Additional Terms: Merchants: Magic Words
- Using magic words prevents additional terms in the offer
- "This offer is conditioned on acceptance of the terms hereof. Any additional or different terms contained in an acknowledgment are expressly objected to and shall not be deemed to be a part of the contract.”
Acceptance under the UCC for Non-Merchants
- Farmer offers 100 applies for $100 with payment due December 15 @ 9am
- Non-merchant agrees and requests apples are boxed 10 apples per box
- The additional term must be assented to by the farmer
Acceptance under the UCC for Merchants
- A farmer offers 100 applies for $100 with payment due December 15 @ 9am
- A merchant agrees and requests that apples are boxed 10 apples per box and delivered on refrigerated train
- Boxed apples per box is okay, not a material change, becomes part of contract unless farmer objects
- Delivery to farmer would be treated as a proposal to the farmer who can decline by delivering by truck
Both Parties are Merchants per 2-207(2)
- A merchant is a person who deals in goods or holds themselves out as having knowledge of skill peculiar to the practices or goods involved in the transaction
- Additional terms in the acceptance become part of the contract unless:
- The offer expressly limits acceptance to the terms of that offer
- The terms materially alter the contract.
- Notification of objection to them has been given or is given within a reasonable time
Either Party is not a Merchant per 2-207(2)
- Additional terms in acceptance become proposals, not binding
- If terms are different, terms of offer are incorporated into the contract
- Opposite of the "last shot rule"
Differing and Conflicting Terms and the Knock-Out Rule
- Most states will follow the knock-out rule
- Differing terms in the offer and acceptance are both treated as unenforceable
- Court applies the UCC gap-filling provisions to supply the term
The Knock-Out Rule and Example
- ACME Corp. sends a price quote for toy trains to Wiley Corp
- Quote states ACME's boilerplate purchase and sale terms
- Requires any claim arising from the sale to be filed in court within one year of date
- Wiley sends ACME Corp a purchase order for 100,000 trains
- Wiley order contains standard terms
- States it may bring claims against ACME for three years
- ACME accepts payment and ships 100,000 trains
Studying That Suits You
Use AI to generate personalized quizzes and flashcards to suit your learning preferences.
