Q&A Hero

Q: If a contract for a sale of goods does not include a price term, it may still be enforceable.

Q: A breach of a contract for which an instrument was issued will defeat the claim of an ordinary holder for payment on the instrument.

Q: A lease agreement is the lessor and lessee's bargain.

Q: The completion of an originally incomplete instrument in an unauthorized manner is a defense against payment on the instrument to an HDC.

Q: Article 2A applies only to consumer leases.

Q: A person whose name is forged on an instrument cannot avoid payment on the instrument to an HDC.

Q: Under the UCC, a merchant who sells one type of good will be considered a merchant for any other type of good that he or she may sell.

Q: Universal defenses defeat the claims of HDCs.

Q: The UCC imposes some different rules of conduct on merchants and consumers.

Q: The drawer of a check cannot enforce all of the presentment warranties.

Q: A sale of a fixture is always considered a sale of realty.

Q: Warranty liability does not bind parties who only present instruments for payment.

Q: A contract for the sale of minerals is considered to be a contract for the sale of goods if the severance is to be made by the buyer.

Q: When an instrument has a forged indorsement, the loss usually falls on the first party to take the instrument.

Q: For an item to be characterized as a "good" under the UCC, it must be intangible.

Q: An unauthorized signature never binds the person whose name is forged.

Q: Under the UCC, a sale occurs when title passes from a seller to a buyer for a price.

Q: An authorized agent may be personally liable on an instrument if the agent does not sign his or her own name.

Q: Article 2 of the UCC governs the sale of goods.

Q: An accommodation party that pays an instrument has a right of recourse against the party accommodated.

Q: An instrument is dishonored when its payment is refused.

Q: An instrument is dishonored when its acceptance is refused.

Q: Presentment of a negotiable instrument may be properly made, depending on the type of instrument, by any commercially reasonable means.

Q: A drawer is primarily liable on an instrument.

Q: An acceptor is secondarily liable to all subsequent holders of an instrument.

Q: If an instrument is incomplete when the maker signs it, the maker's obligation is to pay it to an HDC according to the incomplete terms.

Q: A person is not liable on a negotiable instrument unless he or she, or his or her authorized agent, signs it.

Q: Eagle Products, Inc., transacts business with First Distribution Corporation online. Under the UETA, what determines the effect of the electronic documents evidencing the parties' deal? Is a party's "signature" necessary?

Q: Creative Solutions Corporation (CSC) agrees to sell software to Drew from CSC's Web site. To complete the deal, Drew clicks on a button that, with reference to certain terms, states, "I agree." What is this sort of agreement called? Do the parties have a binding, enforceable contract that includes the terms? Explain.

Q: Quality Products, Inc., and Regional Sales Corporation enter into a contract involving software. The UCITA covers contracts to a. buy or license software. b. buy software only. c. license software only. d. neither buy nor license software.

Q: Office Applications Corporation (OAC) sends an electronic record to Peak Office Systems, Inc., an OAC customer. Under the UETA, the record will be considered received when it a. enters Peak's processing system in a readable form, even if no person is aware of its receipt. b. enters Peak's processing system in a readable form, only if a person is aware of its receipt. c. is midway between the parties' processing systems. d. passes out of OAC's control.

Q: Applied Products, Inc., and Best Sales Corporation transact a deal over the Internet. Their contract does not mention the UETA. The UETA covers a. none of the contract. b. only the part of the contract that does not involve e-commerce. c. only the part of the contract that involves e-signatures. d. the entire contract.

Q: Alan and Beth, consumers, transact a deal over the Internet. Their contract does not mention the UETA. The UETA covers a. none of the contract. b. only the part of the contract that concerns computer information. c. only the part of the contract that does not concern computer information. d. the entire contract.

Q: Central Processing Corporation and National Data, Inc., enter into a contract online in a state that has enacted an unmodified version of the UETA. With regard to the E-SIGN Act a. the E-SIGN Act does not preempt this version of the UETA. b. the E-SIGN Act preempts this version of the UETA. c. the two acts "cancel" each other's application. d. none of the above.

Q: Abel Tool Company and Baker Equipment, Inc., enter into an e-contract. Under the Uniform Electronic Transactions Act (UETA), their contract is a. enforceable only because it is in an electronic form. b. not unenforceable because it is in an electronic form. c. unenforceable because it is in an electronic form. d. unenforceable unless it is accompanied by digital signatures.

Q: Great Sales Corporation enters into contracts with distributors and other buyers in e-commerce and in traditional commerce. The UETA applies, if at all, only to those transactions in which the parties agree to use a. e-commerce only. b. e-commerce or traditional commerce. c. neither e-commerce nor traditional commerce. d. traditional commerce only.

Q: Alpha Company and Beta Corporation, business firms, transact a deal over the Internet. Their contract does not mention the UETA. The UETA covers a. none of the contract. b. only the part of the contract that concerns computer information. c. only the part of the contract that does not concern computer information. d. the entire contract.

Q: Mary and Nick make a deal that comes under the UETA. Under the UETA, "information that is inscribed on a tangible medium or that is stored in an electronic or other medium and is retrievable in perceivable form" is a. an e-document. b. an e-signature. c. an e-transaction. d. a record.

Q: Fact Pattern 19-1 California Fruit, Inc., ships a boxcar-load of fruit cross-country to Delaware Grocers, Inc., for $8,000. California e-mails that it will accept $7,000 in full payment. After Delaware pays $7,000, California files a suit against Delaware for the balance. Refer to Fact Pattern 19-1. Under the E-SIGN Act, as applied in Case 3, In re Cafeteria Operators, L.P., California's e-mail is a. enforceable because it constitutes a writing and the deal with Delaware was in interstate commerce. b. enforceable solely because it constitutes a writing. c. enforceable solely because the deal was in interstate commerce. d. unenforceable because it does not constitute a writing.

Q: Fact Pattern 19-1 California Fruit, Inc., ships a boxcar-load of fruit cross-country to Delaware Grocers, Inc., for $8,000. California e-mails that it will accept $7,000 in full payment. After Delaware pays $7,000, California files a suit against Delaware for the balance. Refer to Fact Pattern 19-1. Under the E-SIGN Act as applied in Case 3, In re Cafeteria Operators, L.P., California is most likely entitled to a. an additional $15,000. b. an additional $7,000. c. an additional $1,000. d. nothing more.

Q: Cody and Dana engage in a transaction that involves e-documents. The E-SIGN Act applies if those documents include a. court papers. b. evictions. c. foreclosures. d. none of the above.

Q: First Design Corporation, a business firm, and Gary, a consumer, make a deal over the Internet that involves e-signatures. Under the E-SIGN Act, for the e-signatures to be enforceable a. both parties must have agreed to use e-signatures. b. neither party must have agreed to use e-signatures. c. only First Design must have agreed to use an e-signature. d. only Gary must have agreed to use an e-signature.

Q: National Sales Corporation and Online Purchasing, Inc., attempt to enter into a contract with the use of e-signatures. Among states that have e-signature laws, the laws are a. identical. b. similar. c. uniform. d. none of the above.

Q: Over the Internet, Alpha Contractors, Inc., arranges to lease storage space from Beta Services Company. To complete the deal, Alpha clicks on a button that says, in reference to certain terms, "I agree." Most likely, the parties have a. a binding contract that includes the terms. b. a binding contract that does not include the terms. c. an unenforceable contract that includes the terms. d. an unenforceable contract that does not include the terms.

Q: Interstate Software Company uses shrink-wrap agreements. The terms of a shrink-wrap agreement generally concern a. neither warranties nor remedies for their breach. b. only remedies for breach of warranties. c. only warranties. d. warranties, remedies for their breach, and other issues.

Q: Digital Products Company includes a shrink-wrap agreement in a transaction with Eagle Engineering Corporation. A shrink-wrap agreement is an agreement whose terms are expressed a. in code at the end of a computer program . b. inside a box in which goods are packaged. c. in small print at the end of a paper contract signed by both parties. d. on a computer screen.

Q: American Manufacturing, Inc., orders supplies online from Best Parts Company. To complete the order, the buyer is required to click on a button that says, in reference to certain terms, "I agree." This is a. a click-on agreement. b. a default agreement. c. an attribution agreement. d. a shrink-wrap agreement.

Q: Office Products, Inc., engages in a licensing transaction, which involves a. a passage of title only. b. a right to use only. c. a passage of title and a right to use. d. none of the above.

Q: Gamma Software Corporation sells its products to business and consumer end-users. Like most sales of software, Gamma's sales involve a. a passage of title and a right to use the software. b. a passage of title only. c. a right to use the software only. d. neither a passage of title nor a right to use the software.

Q: Under the UETA, once an e-record leaves the sender's control, it is sent.

Q: According to the Uniform Computer Information Transactions Act (UCITA), computer information is "information about computers."

Q: The UETA requires the use of security procedures to verify changes to e-documents.

Q: In e-transactions, attribution refers to procedures that may be used to ensure that a person sending an e-record is the same person whose e-signature accompanies the record.

Q: The UETA replaces other state laws on issues relating to contract formation.

Q: Under the UETA, a contract is unenforceable if it is solely in electronic form.

Q: Parties cannot waive or vary the provisions of the UETA by contract.

Q: The UETA applies only to electronic records and e-signatures relating to a transaction.

Q: Under the Uniform Electronic Transactions Act (UETA), a signature may be denied legal effect solely because it is in electronic form.

Q: Under federal law, an electronic document is as valid as a paper document, without exceptions.

Q: Under the Electronic Signatures in Global and National Commerce (E-SIGN) Act, a signature may be denied legal effect solely because it is in electronic form.

Q: Without a consensus as to what constitutes a valid signature, little legal work can be accomplished.

Q: Browse-wrap terms are arguably not enforceable.

Q: The terms of a contract must have been read to be enforceable.

Q: A click-on agreement is normally not enforced.

Q: All of the terms presented in shrink-wrap agreements have been enforced.

Q: A shrink-wrap agreement is normally not enforced.

Q: A shrink-wrap agreement is an agreement whose terms are expressed inside a box in which the goods are packaged.

Q: A license contract may involve a right to use software.

Q: Quality Sales Corporation sells its products in contracts entered into online. Quality can protect itself against disputes involving these contracts by making important terms a. clear. b. difficult to notice. c. impossible to find. d. standardized.

Q: Delta Services, Inc., and E-Products Corporation negotiate a software license. This is a. a passage of ownership rights to the software. b. a right to use the software. c. a passage of ownership rights to, and a right to use, the software. d. none of the above.

Q: International Inventory, Inc., does business online. Contracts may be formed online for the purpose of a. licensing and sales of goods and services. b. licensing only. c. neither licensing nor sales of goods and services. d. sales of goods and services only.

Q: Under the UETA, once an e-record comes under the recipient's control, it is sent.

Q: An e-record is considered received under the UETA only if a person is aware of its receipt.

Q: A record does not have legal effect under the UETA unless someone signs it.

Q: Under the UETA, a person's name is necessary to give effect to an electronic record.

Q: The UETA requires that an agreement to conduct a transaction electronically be made electronically.

Q: Parties cannot opt out of the UETA.

Q: The UETA does not apply to a transaction unless the parties "opt in."

Q: The UETA supports the enforcement of e-contracts.

Q: The UETA creates rules for electronic transactions.