The Legal Environment of Business: Text and Cases (MindTap Course List)
The Legal Environment of Business: Text and Cases (MindTap Course List)
10th Edition
ISBN: 9781305967304
Author: Frank B. Cross, Roger LeRoy Miller
Publisher: Cengage Learning
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Chapter 14, Problem 6BCP
Summary Introduction

Case summary: Company NEPG contracted with company SS to supply stylets and nozzles to company KY. However, the contract did not make any reference to KY or required its acknowledgement. NEPG further contracted with company SS for acquiring parts from company IS. The terms of the contract stated that before shipment, company IS will obtain company NEPG’s acceptance on conforming goods. NEPG will certify the shipment according to KY’s specification. And on delivery, KY will inspect the goods. After nearly six transactions, NEPG refused to make payments as the material supplied by SS was rejected by KY.

To find: The impact of the UCC acceptance rules on the action of the parties.

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Toby's Doggie Hotel enters into a contract with ABC Marketing to purchase 100 orange frisbees for $300.00.  Toby's Doggie Hotel repudiates the contract and ABC later resells the frisbees to someone else for $250.00.    a. ABC is not entitled to recover from Toby's Doggie Hotel   b. ABC is entitled to recover $50.00 from Toby's Doggie Hotel   c. ABC is entitled to recover $250.00 from Toby's Doggie Hotel   d. ABC is entitled to recover $300.00 from Toby's Doggie Hotel
Emilio's Italian Restaurant enters into a contract with Vino winery wherein Emilio's agrees to purchase all the wine that Vino produces for $8/bottle.   a. This contract is unenforceable because it fails to specify a quantity in the contract.   b. This is an enforceable contract.   c. This contract will only be enforceable if every other contract terms is specified in the contract.   d. This contract is unenforceable because Vino hasn't given any consideration for selling all their wine to Emilio's.
Case 5 P Corp, a retailer of women’s fashion accessories, contracted Sandra as their purchasing agent. The agency contract expressly stipulates that Sandra is not allowed to enter into contract in excess of $50,000.00 without first obtaining approval from P Corp. On a number of occasions, Sandra negotiated the purchase of quantities of costume jewellery from Z Inc for prices varying between $30,000 to $45,000.00. Recently, Sandra placed an order with Z Inc for goods at a price of $60,000.00 and without consulting P Corp. Z Inc did not question the order. Two weeks after, Z Inc received payment from P Corp. Sandra was reprimanded by P Corp and, again, reminded of her $50,000.00 limit. Despite the warning, Sandra placed another order of $55,000.00 from Z Inc. This time P Corp refuse to pay and demanded Z Inc to take back the goods. Issues: Is Sandra acting on actual or apparent authority? Is the principal bound by the action of the agent, Sandra? Please state your reasons
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