§2-315: Fitness for particular purpose

If seller has reason to know any particular, unusual purpose and the buyer is relying on the seller’s expertise to get those kinds of goods, seller needs to do so. Can be excluded or modified.

§2-314: Implied warranty of merchantability

1) If the seller is a merchant, goods need to be merchantable unless warranty is excluded or modified in the K. Merchantability includes: passing w/o objection in the trade; fit for ordinary purposes; all the goods are about the same quality; adequately contained, packaged, and labeled as required; conform to promises on the label.

2) These may arise from course of dealing or usage of trade

§2-313: Express warranties

Express warranties created by: a) Affirmation of fact or promise made by seller which becomes part of the basis for the bargain; b) Description of the goods which becomes part of the bargain; c) Sample or model which becomes part of the bargain. Seller doesn’t need to use the words “guarantee” or “warrant” to make a warranty.

§2-312: Warranty of title

1) Implied warranty that a) title to the goods is good; b) There’s no lien on the goods (i.e., creditor can’t grab them from the buyer to settle a debt)

2) Only specific language can disclaim these warranties, or if the buyer knows the seller doesn’t have good title.

§2-310: Open time for payment

Payment is due at time and place of receipt of goods unless otherwise specified. Seller is normally not required to give up title to the goods until the buyer has paid, but buyer is allowed to inspect goods first.

§2-309: Absence of Specific Time Provisions

• Reasonable time for delivery if not specified in K. If the K has multiple performances that are indefinite in duration, parties may cancel after a reasonable time unless otherwise specified. Need reasonable notification of such a termination. An agreement getting rid of that notification requirement is unenforceable if it leads to unconscionable results.

 

§2-306: Output and Requirements Ks

Looks to actual good faith requirements or output of the party. Note 3– if the K estimates a quantity, you can’t greatly deviate from that number, only a little bit.

§2-305: Open Price Term

1) K can operate without price term. Reasonable price is supplied if a) no price on the K; b) Price is left to be agreed but they can’t agree; c) Price pegged to a market index that turns out not to be set.

2) Price to be fixed by seller needs to be fixed in good faith

3) If no price b/c of fault of one party, the other party may cancel or reasonably fix the price himself

4) K not binding if the intent of parties was not to be bound without a price.

§2-302: Unconscionability

1) If a clause is unconscionable, the court can refuse to enforce the clause, refuse to enforce the K, or limit the application of the clause to avoid an unconscionable result.

2) Commercial setting should be taken into account when determining unconscionability

§2-209: Modification, Rescission or Waiver

1) Modifying an agreement doesn’t need consideration.

2) If the K specifies no modification except by signed writing, that’s the only way you can do it. But, except between merchants, such a term needs to be separately signed.

3) Need to satisfy Statute of Frauds

4) A modification or rescission can operate as a waiver even if it doesn’t satisfy (2) or (3)

5) A waiver on an executory part of the K can be withdrawn unless the other party has relied on it.