Law - Ch-5

Under the CISG which of the following is a principal obligation of the seller?

• To pay the price agreed

• 1. To inspect the goods for conformity

• 1. To deliver the documentation at a time and place agreed

• 1. To accept delivery

Which of the following statements about remedies for a breach of contract is correct?

• 1. Any anticipatory breach by a seller entitles the buyer to avoid the contract

• 1. Damages are awarded to punish the party at fault for the breach

• 1. Performance ensures completion of the contact as originally agreed

• 1. Non-conformity of goods gives the seller the right to reduce the contract price

Which of the following does NOT give grounds for anticipatory breach of contract?

• 1. The serious deficiency in ability of one party to perform the contract

• 1. A significant inconvenience for the seller, rendering performance as agreed more onerous

• 1. The serious loss of creditworthiness of one party to the contract

• 1. Conduct illustrating an inability to perform a substantial part of the contract as agreed

Which of the following remedies is available to the buyer, but not the seller?

• 1. Reduce the price

• 1. Fix additional time to perform

• 1. Claim damages

• 1. Declare the contract avoided

Which of the following statements about the duty to preserve goods is correct?

• 1. If the buyer has received the goods and intends to reject them, no steps need be taken to preserve them

• 1. If the goods have been placed at the buyer’s disposal at their destination and the buyer rejects them, the buyer need not take possession of them on behalf of the seller

• 1. A party who is bound to preserve the goods cannot deposit them in a warehouse of a third person

• 1. If the buyer delays in taking delivery, the seller must take such steps as are reasonable in the circumstances to preserve the goods

Den, ordered 2 tons of barley from Axl, with Den paying to ship the goods. Axl inspected the goods immediately before shipment and was satisfied that the barley was in good condition. During transportation, the barley was exposed to damp. Den unloaded the barley and without inspecting it, put it into the manufacture of beverages. It was only testing the final product that Den discovered that the barley must have been sub-standard.

What is Axl’s liability under CISG?

• 1. Axl is liable to Den as he ought to have known the barley did not conform

• 1. Axl is liable to Den as the barley was not fit for its express purpose

• 1. Axl is not liable as Den failed to examine the goods upon delivery

• 1. Axl is not liable as Den agreed to pay for shipping

What does a fundamental breach of a contract entitle the injured party to do?

• 1. Claim damages only

• 1. Declare the contract avoided only

• 1. Declare the contract avoided and claim damages

Romin Co ordered a new car from an overseas car manufacturer. The price was agreed at $27,000 and the company signed a purchase agreement. Subsequently, Romin Co advised the manufacturer that it could not afford the car and would not take delivery of it. The manufacturer sold the car to Saffy Co for $25,300.

What is Romin Co’s liability to the car manufacturer under CISG?

• 1. It is liable for the agreed sale price of $27,000

• 1. It is not liable since the manufacturer has sold the car to Saffy Co

• 1. It is liable for $1,700, being the reduction in the price to Saffy Co

• 1. It is not liable as the manufacturer should have mitigated the loss and sold the car to a party other than Saffy Co for $27,000

Hank dispatched some machine parts to Tex in good faith, believing the goods to be in perfect condition. After dispatch Hank was alerted to the fact that there was a problem with the recent batch from which those parts were taken.

Which of the following correctly describes Hank’s liability?

• 1. Hank has no liability , he believed the goods conformed when he dispatched them

• 1. Hank has no liability if he informs Tax that he intends to remedy the situation at his own expense before the date of agreed delivery

• 1. Hank cannot escape liability as he breached his duty to inspect the goods before dispatching them

• 1. Hank cannot escape liability as the goods are already in transit

To what extent may damages be awarded for a breach of contract?

• 1. To put the innocent party in the position he would have been in if the contract had been performed

• 1. To restore the position of the innocent party to what it would have been if the contract had never been made

• 1. To put the innocent party in the position he would have been in had the contract been performed plus an amount of compensation

• 1. To restore the position of the innocent to what it would have been if the contract had never been made plus an amount of compensation