Question

CONTRACT ANAYLSIS I

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Business MGMT.

You own a furniture making business. It thrives well, provides for your family and you enjoy your labor of love.

A busload of tourists arrive and some of the travelers stop into your shop. They inquire about your work, product and availability. After exchanging information with one interested traveler, you go back to your work. He had mentioned that he wanted you to make him a bedroom set, including a dresser, armoire, nightstand and your “piece de resistance”, a magnificent sleigh bed with intricate carvings and hard to find exotic woods .

You begin working on the project before contacting the traveler by procuring materials and sketching out designs. It dawns on you to contact him to discuss this further as this is a big project that will take a lot of time. When you speak to him, he expressed that he would very much like to order the furniture but payment terms must be discussed. You ‘hammer out’ payment terms of 1/3 as deposit, 1/3 at halfway point and 1/3 on delivery and acceptance.

He mails the deposit with a letter laying out some ideas and a request for a certain type of wood-super exotic zebra-spiderman

oak. You set about working on the furniture but cannot locate enough of the wood for the whole project. You find a similar wood:

zebra-batman hickory. It looks close enough to the spiderman, so you use it.

Traveler visits at the halfway point, pays another 1/3 and mentions nothing about the wood difference. You finish, prepare the furniture for delivery and ship it to Traveler’s home. As the furniture is unloaded, Traveler stops the unloading and refuses to accept it based on the wood difference. He sends it back to you with a note: NOT spidey wood, not accepted!, no final payment, enjoy sleeping in that hunk of junk!

Ultimately you are able to sell the furniture to someone else at a fraction of the price.

Now that we learned about UCC application and use, analyze this hypothetical. In short answer, discuss offer and acceptance as seen through the UCC lens; discuss warranties, if any and remedies, both as viewed through the UCC

Answer 1

For a contract to begin, there has to be an offer+acceptance. In this case, the offer is given before the business walks to the party in order to discuss and finalise the details of the requirements along the offer given. And the offer gets accepted after they discuss the payment structure and when then buyer pitches in the deposit letter laying out some ideas and certain type of wood super exotic zebra spiderman.

This acceptance causes to some warranties under UCC i.e. Uniform Commercial Code.Since the UCC deals with sale of goods and not services, it covers an offer to sell goods a d the acceptance of the offer. Article 2 also outlines certain aspects of the warranties that are imposed by the law. There are two types of warranties : Express and Implied.

Express warranties are assured promises of the quality and features of the goods being sold. It also includes all kinds of details and decription that has been given for a product to match as ler the requirements or a sample which is shown in order to fulfill similarity of the product to the required/ordered product. While accepting the contract, the buyer informs the seller with some exclusive ideas and requirements of using a super exotic spider zebra wood. This forms a part of express warranty which also uses the rule of caveat emptor. This warranty has been particularly broken when the seller in absence of the zebra spider wood, uses the zebra-batman hickory. Also, when the buyer visits halfway through the project doesn’t notice the difference when it’s an equal duty of his to verify this request and make sure that is how it is done.

In addition, Implied warranties as the name explains is applied regardless of any feature specifically mentioned or not. It obliterates the rule of caveat emptor. It allows buyers to purchase products with minimum quality standards and confidence, fit for a particular purpose/order.Here an order of a bedroom set, including a dresser, armoire, nightstand and piece de resistance is an implied warranty. Which seems to be fulfilled till the end of the contract. No such violations for it is witnessed particularly as even at the time of delivery and before that was there any change in these basic requirements.

When the buyers has to pay the final amount in order to complete the contract, he gets aware and finds that there has been viokation of express warranty i.e. the wooden used is different from what was requested. The seller stayed silent about it and did not inform the customer about the change which is a breach in contract and its features and express warranty .

Hence, it is okay for the buyer to reject the final payment being aware about the uninformed change and reject the product with the same intenton on delivery leading to an incomplete contract arising from failure to perform express warranties from the sellers end.