20 QUESTIONS:
1. Under an oral agreement, Hyer rented from Bateman a vacant lot for a filling station. Hyer placed on the lot a lightly constructed building bolted to a concrete slab and several storage tanks laid on the ground in a shallow excavation. Later, Hyer prepared a lease which contained a provision allowing him to remove the equipment at the termination of the lease. This lease was not executed, having been rejected by Bateman due to a renewal clause it contained. Several years later, another lease was prepared, which both Hyer and Bateman did sign. This lease did not mention removal of the equipment. At the termination of this lease, Hyer removed the equipment, and Bateman brought an action to recover possession of the equipment. Please discuss what the judgment would be and explain why.
2. John Swan rented a safe deposit box at the Tenth Citizens Bank of Emanon, State of X. On December 17, 2011, Swan went to the bank with stock certificates to place in the safe deposit box. After he was admitted to the vault and had placed the stock certificates in the box, Swan found lying on a chair in the privacy booth of the vault a $5,000 negotiable bearer bond issued by the State of Wisconsin with coupons attached, due June 30, 2018. Swan picked up the bond and, observing that it did not carry the name of the owner, left the vault and went to the office of the president of the bank.
He told the president what had occurred and delivered the bond to the president only after obtaining his promise that, should the owner not call for the bond or become known to the bank by June 30, 2012, the bank would redeliver the bond to Swan. On July 1, 2012, Swan learned that the owner of the bond had not called for it, nor was his identity known to the bank. Swan then asked that the bond be returned to him. The bank refused, stating that it would continue to hold the bond until the owner claimed it. Explain whether Swan will prevail in his action to recover possession of the bond.
3. Hines stored her furniture, including a grand piano, in Arnett's warehouse. Needing more space, Arnett stored Hines's piano in Butler's warehouse next door. As a result of a fire, which occurred without any fault of Arnett or Butler, both warehouses and their contents were destroyed. Is Arnett liable to Hines for the value of her piano and furniture? Please explain.
4. Mr. Sewall left his car in a parking lot owned by Fitz-Inn Auto Parks, Inc. The lot was approximately 100 by 200 feet in size and had a chain link fence along the rear boundary to separate the lot from a facility of the Massachusetts Bay Transportation Authority. Although the normal entrance and exit were located at the front of the lot, it was also possible to leave by way of small side streets on either side of the lot.
Upon entering the lot, the driver would pay the attendant on duty a fee of $5 to park. The attendant's duties were limited to collecting money from patrons and directing them to parking spaces. Ordinarily, the attendant remained on duty until 11:00 A.M., after which time the lot was left unattended. Furthermore, a patron could remove his car from the lot at any time without interference by any employee of the parking lot.
On the morning of April 15, Sewall entered the lot, paid the $5 fee, parked his car in a space designated by the attendant, locked it, and took the keys with him. This was a routine he had followed for several years. When he returned to the unattended lot that evening, however, he found that his car was gone, apparently having been stolen by an unidentified third person. Is Fitz-Inn, the owner of the lot, liable for the value of the car? Please explain.
5. While adjusting a television antenna beside his mobile home and underneath a high-voltage electric transmission wire, Prince received an electric shock resulting in personal injury. He claims the high-voltage electric current jumped from the transmission wire to the antenna. The wire, which carried some 7,200 volts of electricity, did not serve his mobile home but ran directly above it.
Prince sued the Navarro County Electric Co-Op, the owner and operator of the wire, for breach of implied warranty of merchantability under the Uniform Commercial Code. He contends that the Code's implied warranty of merchantability extends to the container of a product-in this instance, the wiring-and that the escape of the current shows that the wiring was unfit for its purpose of transporting electricity. The electric company argues that the electricity passing through the transmission wire was not being sold to Prince and that, therefore, there was no sale of goods to Prince. Is the contract covered by the Code? Please explain.
6. American Sand & Gravel, Inc., agreed to sell sand to Clark at a special discount if 20,000-25,000 tons were ordered. The discount price was $0.45 per ton, compared with the normal price of $0.55 per ton. Two years later, Clark orders, and receives, 1,600 tons of sand from American Sand & Gravel. Clark refuses to pay more than $0.45 per ton. American Sand & Gravel sues for the remaining $0.10 per ton. Decision, and please explain?
7. Dorton, as a representative for The Carpet Mart, purchased carpets from Collins & Aikman that were supposedly manufactured of 100 percent Kodel polyester fiber but were, in fact, made of cheaper and inferior fibers. Dorton then brought suit for compensatory and punitive damages against Collins & Aikman for its fraud, deceit, and misrepresentation in the sale of the carpets.
Collins & Aikman moved for a stay pending arbitration, claiming that Dorton was bound to an arbitration agreement printed on the reverse side of Collins & Aikman's printed sales acknowledgment form. A provision printed on the face of the acknowledgment form stated that its acceptance was "subject to all of the terms and conditions on the face and reverse side thereof, including arbitration, all of which are accepted by buyer." Is the arbitration clause enforceable?
8. Due to high gasoline prices, American Bakeries Company (ABC) considered converting its fleet of over 3,000 vehicles to a much less expensive propane fuel system. After negotiations with Empire Gas Corporation (Empire), ABC signed a contract for approximately three thousand converter units, "more or less depending upon requirements of Buyer," as well as agreeing to buy all propane to be used for four years from Empire.
Without giving any reasons, however, ABC never ordered any converter units or propane from Empire, having apparently decided not to convert its vehicles. Empire brought suit against ABC for $3,254,963, representing lost profits on 2,242 converter units and the propane that would have been consumed during the contract period. Is ABC liable? Please explain.
9. In April F.W. Lang Company (Lang) purchased an ice cream freezer and refrigeration compressor unit from Fleet for $2,160. Although the parties agreed to a written installment contract providing for an $850 down payment and eighteen installment payments, Lang made only one $200 payment upon receipt of the goods. One year later, Lang moved to a new location and took the equipment along without notifying Fleet. Then, in May or June of the following year, Lang disconnected the compressor from the freezer and used it to operate an air conditioner.
Lang continued to use the compressor for that purpose until the sheriff seized the equipment and returned it to Fleet pursuant to a court order. Fleet then sold the equipment for $500 in what both parties conceded was a fair sale. Lang then brought an action charging that the equipment was defective and unusable for its intended purpose and sought to recover the down payment and expenses incurred in repairing the equipment. Fleet counterclaimed for the balance due under the installment contract less the proceeds from the sale. Who will prevail? Please explain.
10. Fredrick Manufacturing Corporation ordered 500 dozen units of Import Traders' rubber pads for $2,580. The order indicated that the pads should be "as soft as possible." Import Traders delivered the rubber pads to Frederick Manufacturing on November 19. Frederick failed to inspect the goods upon delivery, even though the parties recognized that there might be a problem with the softness. Frederick finally complained about the nonconformity of the pads in April of the following year, when Import Traders requested the contract price for the goods. Can Import Traders recover the contract price from Frederick? Please explain.
11. Moulton Cavity & Mold Inc. agreed to manufacture twenty-six innersole molds to be purchased by Lyn-Flex. Moulton delivered the twenty-six molds to Lyn-Flex after Lyn-Flex allegedly approved the sample molds. However, Lyn-Flex rejected the molds, claiming that the molds did not satisfy the specifications exactly, and denied that it had ever approved the sample molds. Moulton then sued, contending that Lyn-Flex wrongfully rejected the molds. Lyn-Flex, argued that the Code's perfect tender rule permitted its rejection of the imperfect molds, regardless of Moulton's substantial performance. Decision and please explain?
12. Charlotte the owner of a new Cadillac automobile, agreed to loan the car to Ellen for the month of February while she (Charlotte) went to Florida for a winter vacation. It was understood that Ellen, who was a small-town Cadillac dealer, would merely place Charlotte's car in her showroom for exhibition and sales promotion purposes. While Charlotte was away, Ellen sold the car to Bob. When Charlotte returned from Florida, she sued to recover the car from Bob. Who has title to the automobile? Please explain.
13. Brilles offered to sell his used automobile to Nevarro for $12,600 cash. Nevarro agreed to buy the car, gave Brilles a check for $12,600, and drove away in the car. The next day Nevarro sold the car for $13,000 to Hough, a bona fide purchaser. The $12,600 check was returned to Brilles by the bank in which he had deposited it because of insufficient funds in Nevarro's account. Brilles brings an action against Hough to recover the automobile. What judgment?
14. Fred Lane, who sells boats, motors, and trailers, sold a boat, motor, and trailer to John Willis in exchange for a check for $6,285.00. The check was not honored when Lane attempted to use the funds. Willis subsequently left the boat, motor, and trailer with John Garrett, who sold the items to Jimmy Honeycutt for $2,500.00. Considering the boat's quality, Honeycutt was surprised at how inexpensive it was. He did not know where Garrett had obtained the boat, but he had dealt with Garrett before and described him as a "sly businessman." Garrett did not sell boats; normally, he sold fishing tackle and provisions. Honeycutt also received a forged certificate for the boat, on which he had observed Garrett forge the purported owner's signature. Can Lane compel Honeycutt to return the boat, motor, and trailer? Please explain.
15. Fred Lyon of New York, while on vacation in California, rented a new model Home Run automobile from Hart's Drive-A-Car. The car was manufactured by the Ange Motor Company and was purchased by Hart's from Jammer, Inc., an automobile importer. Lyon was driving the car on a street in San Jose when, due to a defect in the steering mechanism, it suddenly became impossible to steer. The speed of the car at the time was thirty miles per hour, but before Lyon could bring it to a stop, the car jumped a low curb and struck Peter Wolf, who was standing on the sidewalk, breaking both of his legs and causing other injuries. What rights does Wolf have against (a) Hart's Drive-A-Car, (b) Ange Motor Company, (c) Jammer, and (d) Lyon?
16. The plaintiff, while driving a pickup manufactured by the defendant, was struck in the rear by another motor vehicle. Upon impact, the plaintiff's head was jarred backward against the rear window of the cab, causing the plaintiff serious injury. The pickup was not equipped with a headrest, and none was required at the time. Should the plaintiff prevail on a cause of action based upon strict liability in tort? Why? Why not? Please explain.
17. The plaintiff's children purchased an Aero Cycle exercise bike for their mother to use in a weight loss program. The Aero Cycle bike was manufactured by DP and purchased from Wal-Mart. The first time the plaintiff, Judy Dunne, used the bike she used it only for a few seconds. But the second time she used it, she pedaled for three or four rotations when the rear support strut failed and the bike collapsed under her. At the time of the accident, the plaintiff weighed between 450 and 500 pounds. She fell off the bike backwards, struck her head on a nearby metal file cabinet, and was knocked unconscious. When the plaintiff regained consciousness, her mouth was bleeding and her neck, left shoulder, arm, leg, knee, and ankle were injured. The plaintiff was diagnosed as having a cervical strain and multiple contusions. She filed suit against Wal-Mart and DP. Explain whether the plaintiff should prevail.
18. Robert in Chicago entered into a contract to sell certain machines to Terry in New York. The machines were to be manufactured by Robert and shipped F.O.B. Chicago not later than March 25. On March 24, when Robert was about to ship the machines, he received a letter from Terry wrongfully repudiating the contract. The machines cannot readily be resold for a reasonable price because they are a special kind used only in Terry's manufacturing processes. Robert sues Terry to recover the agreed price of the machines. What are the rights of the parties? Please explain.
19. Margaret contracted to buy a particular model Rolls-Royce from Paragon Motors, Inc. Only one hundred of these models are built each year. She paid a $3,000 deposit on the car but Paragon sold the car to Gluck. What remedy, if any, does Margaret have against Paragon? Please explain.
20. Mrs. French was the highest bidder on eight antique guns at an auction held by Sotheby & Company. Mrs. French made a down payment on the guns but subsequently refused to accept the guns and refused to pay the remaining balance of $24,886.27 owed on them. Is Sotheby's entitled to collect the price of the guns from Mrs. French? Please explain.