Posted: November 9th, 2016

Under the UCC, Section 2-207 (the “battle of the forms” provision), it is provided that, when both parties to a contract are merchants, any additional terms added in the acceptance of a standard form contract can properly, validly become part of the contractual agreement UNLESS:

27. Under the UCC, Section 2-207 (the “battle of the forms” provision), it is provided that, when both parties to a contract are merchants, any additional terms added in the acceptance of a standard form contract can properly, validly become part of the contractual agreement UNLESS: a) The original offer expressly limits any acceptance only to the terms in the original standard form offer. b) The additional terms in the acceptance materially alter the terms of the original standard form offer. c) The offeror notified the offeree, within a reasonable period of time, that the additional terms were not acceptable. d) All of the above could be true. e) 28. If Earl, a nonmerchant, offered to sell a chair to Isaac, a nonmerchant. Earl’s house caught fire and destroyed the chair before Isaac accepted Earl’s offer to buy the chair. Consequently, a) The destruction of the chair constitutes an automatic valid revocation of the offer. b) The fire does not automatically revoke the offer, but because neither Earl nor Isaac is a merchant, the offer is revocable at any time at Earl’s option. c) Earl did not validly communicate a revocation to Isaac, so Isaac still has the option of accepting Earl’s offer; if Isaac accepts the offer, Earl must obtain a similar chair for Isaac or pay Isaac the equivalent value of the chair. d) Earl’s offer is automatically revoked by the fire, unless the offer was a firm offer. 29. Reg offered to sell his motorcycle to Thelma for $8,000. Thelma replied, “Your price is too high. I will purchase your motorcycle for $7,000”. Reg agreed and they committed their agreement to writing. This transaction can be characterized as: a) An enforceable contract because Reg’s acceptance of Thelma’s offer was a clearly communicated acceptance. b) An enforceable contract because Thelma’s counteroffer was less than Reg’s original offer c) An unenforceable contract because Thelma’s offer was not the mirror image of Reg’s original offer as is required under common law contract rules. d) An unenforceable contract unless either Reg or Thelma is a merchant, as defined by the UCC, because sale of personal property contracts are valid only if one of the parties to the contract is a merchant. 30. A ordered 100 19-inch color TV sets from B, and requested prompt shipment of the goods. B promptly shipped to A 100 21-inch color TV sets. Prior to shipment, B did not notify A that he was shipping nonconforming TVs as an accommodation. Assuming both A and B are merchants, under UCC rules, in this case: a) There is no valid acceptance by B; shipping nonconforming goods acts as a counteroffer, and thus, cannot constitute an acceptance or create a valid, enforceable contract. b) Although B shipped nonconforming TVs, A is bound to pay the reasonable value of the 21-inch nonconforming TV sets because B’s shipment constituted a valid acceptance, and a binding contract was formed at the time the goods were shipped. c) Although B shipped nonconforming TVs, if A accepts and later sells the 21-inch TVs, A has validly accepted the nonconforming goods and is bound to pay B reasonable value for the 21-inch TVs. d) There is no contract because B’s acceptance (by shipping the goods) is not a mirror image of A’s offer. 31. Contracts involving the sale of goods valued at over $500 must be in writing in order to be enforceable? True or False. 32. B & B Tape Co. orally agreed to sell 2,000 boxes of tape to Office Supply, Inc. (Office) at a rate of $1.00 per box, for a total of $2,000. Office orally agreed to the deal. B & B delivered 1,000 boxes, totaling $1,000. Office accepted the delivery and used and sold the tape, but refused to pay for the goods, citing the Statute of Frauds. Under these circumstances, Office is obligated to pay: a) Nothing, and may keep the tape because the agreement is unenforceable because it was not written. b) $1,000 for the 1,000 boxes that Office accepted, but is not obligated to accept, or pay for, any more tapes. c) $2,000 as Office is bound to buy the entire 2,000 boxes of tape. d) $1,000 for the 1,000 boxes that Office already accepted, plus $500 for one-half of the remaining 1,000 boxes. 33. Employer promised to pay Employee a $10,000 annual pension for the remainder of Employee’s life, upon Employee’s retirement. In return, Employee promised to pay Employer $100 per year for each of the years he works until retirement. Employee relied on this promise and took out a mortgage on a retirement house. Three years later, Employer refused to honor his promise to pay Employee the $10,000 annual pension. Employer’s promise probably is: a. Not binding unless the agreement was in writing; such an agreement is subject to the Statute of Frauds because it is a contract that cannot possibly be performed within 1 year. b. Not binding because the $100 per year given by Employee is inadequate consideration compared to $10,000 annual pension to be paid by Employer. c. Not binding because the pension was to be paid in the future, thus, there was no present intent to be bound that is necessary for a valid contract. d. Is binding, under the circumstances, if all the other elements of a contract are present.