Question

Fact Pattern (Questions 7–9 apply)

Ripe Produce, Inc., and Southeast Asian Bistro & Market enter into a contract for the delivery of locally grown fruits and vegetables. The parties use a standard Ripe Produce form that contains some of the terms the parties agree on but not others. Some of the produce spoils before it can be cooked, served, and eaten, or sold. Southeast Asian refuses to pay for the spoiled goods.

7.           Refer to Fact Pattern 20-B1. Ripe Produce responds that it did not waive payment for spoiled goods in the parties’ previous transaction. Ripe Produce is arguing that the court should take into account

a.           the course of dealing.

b.           the course of performance.

c.           the usage of trade.

d.           a rule of construction.

8.           Refer to Fact Pattern 20-B1. Ripe Produce files a suit against Southeast Asian, claiming that the buyer assumed the risk of the spoilage of the unsold goods. The court may allow evidence of this term if it finds that the parties’ contract is

a.           fully integrated.

b.           not fully integrated.

c.           not supported by consideration.

d.           a complete and final statement of their agreement.

9.           Refer to Fact Pattern 20-B1. Southeast Asian contends that the practice in the trade with respect to payment for spoiled produce justifies its refusal to pay. Southeast Asian is arguing that the court should take into account

a.           the course of dealing.

b.           the course of performance.

c.           the usage of trade.

d.           a rule of construction.

Answer 1

7.The correct option is A. The course of dealing means that there is a previous recognisable conduct among the parties which should be taken as the basis for interpreting their conduct or behaviour. Here Ripe Produce is referring to the past incidences where payments were not waived for spoilt goods to be taken as the general (understandable and recognisable) conduct between the parties.

8. The correct option is B. The court does not allow external evidences in case of fully integrated contracts under the article 2 of uniformed commercial code. Hence, if the court is allowing external evidences, the contract must be considered as 'not Fully integrated'.

9. The correct option is C. Usage of trade means that a practice is so common (general) that it is expected to be fulfilled during a transaction. So, Southeast Asian tries to argue that it is common practice to receive goods that are not spoilt that he would expect fresh goods to be delivered to him.