Chapter 08 - Contracts for the Sale of Goods

Chapter 8: Contracts for the Sale of Goods

OVERVIEW
This chapter concludes the final part of the contracts chapters by examining
contracts for the sale of goods covered under UCC Article 2. The chapter begins
with a broad view of the differences between the common law of contracts and
the UCC. Students then learn UCC notions of agreement, consideration, and the
statute of frauds. The concept of title and allocation of risk is covered in detail and
the chapter ends with coverage of UCC provisions related to breach and remedies
in sales agreements. There is also some treatment of contracts for international
sales of goods under UNCISG and INCO terms.

KEY LEARNING OUTCOMES

Outcome Accreditation
category
Articulate the fundamental purpose and role of the UCC in Knowledge,
commercial transactions, which contracts are governed by Application
Article 2, and why it is important to business owners and
managers.
Discuss the requirements for agreement in a sale of goods Knowledge,
contract, what terms the UCC provides in a sales agreement with Application,
open or missing terms, and apply the statute of frauds Critical
requirements. thinking
Express how risk of loss is allocated among the parties in a sales Application,
contract and steps managers take to limit risks and assure Critical
performance thinking
Convey UCC requirements on the obligations of the parties and Application,
the consequences once a breach of contract occurred and Critical
identify the appropriate remedy and damages available to the thinking
non-breaching party.

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Chapter 08 - Contracts for the Sale of Goods

TEACHING OUTLINE
A. Introduction to Article 2 of the UCC [P.239]
Points to emphasize:
 Article 2 of the UCC is a model statute, adopted by every state except
Louisiana that governs contracts for the sale of goods.
 UCC Coverage and Definitions: The UCC defines goods as that
which is (1) tangible and (2) movable from place to place.
o Article 2 contains special provisions that apply only in
transactions between merchants, defined as one that is
regularly engaged in the sale of a particular good.
 Function of the UCC: To promote commercial efficiency and
promote the completion of a business transaction by providing more
lenient rules and standardized procedures that merchants and
consumers may rely upon.
o Article 2 of the UCC acts to fill in only missing or open terms
(where the parties have not expressly agreed otherwise) in a
contract for the sale of goods.
B. Agreement in a Sales Contract: Offer [P.240]
Points to emphasize:
 Article 2 lowers the bar for formation by allowing an enforceable
contract to arise “in any manner sufficient to show agreement”
between the parties.
 Offers with Open Terms: An agreement is still valid despite the fact
that delivery, pricing, or payment terms are left open: the UCC
provides standards to fill the gaps left by the missing terms.
o Quantity: While quantity is generally a required term
necessary to create an enforceable contract, quantity may be an
open term if: (1) the buyer agrees to purchase all of the goods
that a seller produces (output contracts); or (2) when the buyer
agrees to purchase all or up to an agreed amount of what the
buyer needs for a given period (requirements contracts).

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Chapter 08 - Contracts for the Sale of Goods

o Other Open Terms: When a sales contract is missing other

terms and the parties have not had an established course of past
conduct, the UCC provides that: Buyer takes delivery at the
seller’s place of business at a reasonable time under the
circumstances; payment is due at the time and place where the
seller is to make delivery and may be made in any
commercially reasonable form; and the court determines a
reasonable price at the time of delivery based on industry
customs and market value.
 Firm Offers by Merchants: A written offer by a merchant includes an
implied promise to keep the offer open for a stated or unstated amount
of time even absent consideration for the option.
C. Agreement in Sales Contracts: Acceptance [P.242]
Points to emphasize:
 If the offeror does not clearly provide for a method of acceptance, the
UCC allows the offeree to accept the offer in any reasonable manner,
and the acceptance does not need to match the offer exactly.
 Battle of the Forms: The conflict between the terms written into
standardized purchase orders (offer) and acknowledgement forms
(acceptance), which differ in that one form favors the buyer and the
other the seller.
o The UCC provides that (1) a document may constitute
acceptance even though it states additional or different terms
from those offered by the offeror, and (2) in certain
transactions the additional terms proposed in the acceptance
may become part of the contract.
o Nonmerchant Transactions: If one of the parties is not a
merchant, the contract is formed as originally offered.
o Merchant Transactions: The additional terms automatically
become part of the contract unless (1) the offer stated explicitly
the terms of acceptance, (2) the conflicting terms substantially

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Chapter 08 - Contracts for the Sale of Goods

change the duties of the contract or its value to one party, or (3)
the new terms were rejected in a timely manner by the offeror.
Case 8.1 Hebberd-Kulow v. Kelomar [P. 244]
Facts:
Hebberd-Kulow Enterprises (HKE) sold agricultural supplies to Kelomar
over a period of approximately 20 years between 1987 and 2007. During that time
period Kelomar would routinely order products over the phone. In these phone
calls, the parties’ representatives would discuss and agree to the type of item, its
quantity, and its price. Kelomar would provide HKE with a purchase order
number for the requested items, but it never sent a formal purchase order
document. After delivery of the items to Kelomar, HKE would send Kelomar an
invoice that corresponded to the applicable purchase order number. In 2003, HKE
began to include a provision for late payments on its invoices: According to HKE,
the late penalty interest rate was standard in the industry. Although Kelomar often
paid late, HKE never charged Kelomar interest on the late payments because of
their long-term business relationship. HKE never informed Kelomar of the new
provision and Kelomar never objected to it. A dispute between the parties arose
after HKE delivered approximately $250,000 worth of goods in 2007. These
goods were shipped separately with corresponding invoices. Kelomar refused to
pay the invoices because it claimed to have incurred damages in a different set of
contractual transactions with HKE that were unrelated to the $250,000 shipment.
HKE sued for the price of the goods and also for late payment interest on the
amount due based on the late payment provision included on the invoices.

Issue: Does the UCC battle-of-the forms provision and failing to enforce the late
penalty in the past bar HKE from recovering?

Ruling: No. The court concluded that the jury verdict awarding interest pursuant
to the [2012] invoices, on the basis of supple-mental contractual terms known to
and agreed to by the parties, is well supported by the testimony [at trial], which

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Chapter 08 - Contracts for the Sale of Goods

showed the general course of dealing in the industry and the specific transactions
between these parties occurring within that frame-work.

Answers to case questions:

1. As a courtesy to an ongoing buyer, sellers may simply be willing to forego the
small late charge in favor of a future business relationship.
2. In this Battle of the Forms case, the additional terms became part of the
contract in 2012 because Kelomar did not raise any objection to the additional
terms.
3. Critical Thinking: This question encourages students to think proactively about
law. If HKE begins to initiate late charges, they risk alienating continuing
customers. They could also be sure that the late payment language is made more
plain on the contract and/or place limiting language on the contract. Kelomar
could institute a system to be sure that new terms are not added to supplier
invoices and may use their own limiting language when issuing a purchase order.

Self-Check: Does a sales contract exist? If so, what are the terms of the contract?
[P.245]

 Consideration: A sales contract can be modified without additional

consideration.
D. Statute of Frauds [P.246]
Points to emphasize:
 The UCC statute of frauds requires that contracts for the sale of goods
valued at $500 or more be in writing, but requires only that the
document contain (1) quantity, (2) the signatures of the party against
whom enforcement is sought and, (3) language that reasonably shows
the parties intended to form a contract.
 All other terms and conditions may be proved via testimony
concerning oral agreements, past practices, and industry standards.

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Chapter 08 - Contracts for the Sale of Goods

 A merchant who receives a signed confirmation memorandum from

the other merchant will be bound by the memorandum just as if she
had signed it, unless she promptly objects.

Concept Summary: Formation under the UCC [P.247]

Legal/Ethical reflection and Discussion: [P. 247]

E. Title and Allocation of Risk [P. 248]

Points to emphasize:
 UCC gap filler function: Any risk allocation provision in the UCC
does not displace the parties existing agreement for risk allocation or
title transfer.
 Title: The UCC provides that title (ownership) passes to the buyer at
the time and place the seller completes performance by making a
physical delivery of the goods.
 Risk of Loss: The risk of loss is born by the party who has title to the
goods.
o All contracts are shipping contracts unless the parties have
agreed otherwise, and title is transferred from seller to buyer
when the goods are given to the courier.
o In a destination contract, title passes when the goods are
tendered to the buyer.

 Goods Picked Up by the Buyer: If the goods are to be picked up by

the buyer and the seller is a merchant, the risk of loss to goods held by
the seller passes to the buyer only when the buyer takes physical
possession of the goods; whereas, if the seller is a nonmerchant, the
risk of loss to goods held by the seller passes to the buyer on tender of
goods.

Self-Check: Who bears the risk of loss? [P.250]

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Chapter 08 - Contracts for the Sale of Goods

Concept Summary: Title and Allocation of Risk [P.251]

F. Performance of Sales Contracts [P.251]

Points to emphasize:
 Once the parties to a sales contract have agreed on its terms, the UCC
imposes certain other duties and obligations in performing the
contract.
 Obligations of All Parties: Under the UCC, parties to a sales contract
have an implied good faith obligation to be “honest in fact in the
conduct of the transaction concerned.”

 Seller’s Obligations and Rights: The UCC obligates the seller to

tender the goods, give the buyer appropriate notice of the tender, and
take any actions necessary to allow the buyer to take reasonable
delivery.
o Perfect Tender: Rule requiring the seller to deliver her goods
precisely as the contract requires in every respect or risk the
buyer’s lawful rejection of the goods.
 The UCC also gives the seller certain rights
intended to promote the completion of the contract:
 Cure: If the time for performance has not ended
after rejection, the seller may cure the breach by
giving notice or by tendering conforming goods in
replacement.
 If the seller reasonably believes that the
nonconforming goods would be acceptable to the
buyer with or without a money allowance, then the
seller gets additional time to cure after the time
under the contract has passed.

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Chapter 08 - Contracts for the Sale of Goods

Case 9.3: Car Transportation Brokerage Company v. Blue Bird (2009) [P.
253]

Facts: Car Transportation (Buyer) purchased a Blue Bird luxury motor coach
(Coach) from Blue Bird’s authorized dealer, Bleakly (Seller), for $650,000.
Although neither the Buyer nor the Seller performed any pre-delivery inspection,
the Seller provided assurances to the Buyer that the Coach was new and in
working condition. On the day of the purchase, however, the Buyer’s principal
drove the Coach from the Seller’s lot and began to notice certain defects with the
Coach’s electrical system. The next day, the Buyer returned the Coach to the
Seller for repairs and the Seller’s service technicians repaired several electrical
problems to the Buyer’s satisfaction. The Buyer re-took possession of Coach and
placed it into service for the Buyer’s business on January 5.
Over the next two months, the Coach had additional electrical system defects and
several other mechanical problems. Instead of returning the Coach to the Seller
once again, the Buyer opted to return the Coach to the manufacturer for repairs.
On February 18, the manufacturer returned the Coach to the Buyer, but the
electrical problems were still not fully resolved. On March 22, the Buyer notified
the Seller that they were revoking the acceptance of the Coach due to the
mechanical problems. Eventually, the Buyer sued the Seller including, among
other claims, revocation of the Buyer’s acceptance. The trial court found in favor
of the Seller and the Buyer appealed.
Issue: Was the Seller given the opportunity to cure as required by Georgia’s
commercial law statutes?
Ruling: For the Seller. The UCC’s opportunity to cure required the Buyer to
provide the Seller with a reasonable time in which to attempt to make repairs.
What constitutes a reasonable time in which to cure depends on the nature,
purpose, and circumstances of a particular case. At the very least, the Seller was
entitled to notice of the additional problems occurring after delivery and an

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Chapter 08 - Contracts for the Sale of Goods

opportunity to repair them at some time during the three months prior to the
Buyer’s revocation.
Answers to Case Questions
1. No. The manufacturer was not the seller and the right to cure is a rightof the
seller.
2. It is a case by case basis depending on the goods sold. Will the buyer may
suffer additional damages, the UCC promotes the completion of the transaction
and disfavors revocations.
3. Critical Thinking: The intent of this question is to stimulate discussion on the
fairness of the cure rule. It may be a good opportunity to compare the European
Union cure rule, which is more favorable to the seller.

 Commercial Impracticability: The UCC excuses performance when a

delay in delivery or nondelivery has been made impracticably by the
occurrence of an unanticipated event, so long as the event directly
affected a basic assumption of the contract.
Strategic Legal Solutions: Assuring Performance [P.254]
 Buyer’s Rights and Obligations: Unless the parties agree otherwise,
once the buyer has accepted the goods, the buyer must make full
payment at the time and place that the goods are received.
o Buyer’s Right of Inspection: Acceptance or Rejection: Unless
the parties agree otherwise, the buyer has a reasonable time
period to inspect the goods and may either (1) communicate
acceptance to the seller; (2) do nothing, and acceptance is
presumed; or (3) notify the seller in a timely manner that she is
rejecting the goods (or part of the goods).
 If the seller has shipped conforming goods, the buyer
has the duty to accept them.
 If the buyer accepts nonconforming goods, the buyer’s
obligation to pay is then triggered and the buyer can

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Chapter 08 - Contracts for the Sale of Goods

later revoke acceptance only if the nonconformity

substantially impairs the value of the goods.

Self-Check: Buyer’s Rights and Obligations: Does the grocer have an obligation
to pay? Why or why not? [P.255]

 Special Rules for Installment Contracts: An installment contract

permits delivery of goods in separate lots and payment at separate
times, with the new right to accept or reject each time (the standard for
rejection is more restrictive).

Concept Summary: Performance of Sales Contracts [P.256]

G. Breach and Remedies in Sales Agreements [P.257]

Points to emphasize:
 The UCC seeks to remedy breach by placing the nonbreaching party in
the same situation as she would have been in had the contract been
executed as written.
 Anticipatory Repudiation in the UCC: Faced with anticipatory
repudiation by the other party, a party under the UCC can either
withdraw and sue for damages or suspend performance until the
repudiation is retracted.
 Remedies Available to the Seller: Available when a buyer breaches a
sales contract by (1) rejecting conforming goods, or (2) wrongfully
revoking acceptance, or (3) failing to pay as agreed, or (4) failing to
meet contractual obligations.
o Goods in Hands of Seller: If a buyer breaches before delivery
then the seller may stop further performance, resell the goods,
or if unable to resell, seek damages.

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Chapter 08 - Contracts for the Sale of Goods

o Goods in Hands of Buyer: If the buyer’s breach occurs after

delivery, the seller may sue for full contract price or reclaim
the goods and collect incidental damages.
 In the case of wrongful rejection or wrongful revocation
of acceptance, the seller may reclaim the goods and
exercise the remedies provided for in the UCC when
the goods are in the hands of the seller, including
recovery of costs of reclamation.
 Remedies Available to the Buyer: Available when a seller breaches a
contract by delivering nonconforming goods or if the seller fails to
make timely delivery of all or part of the lot.
o Remedies Following Rejection of Goods: The UCC provides
the buyers with the immediate remedy of rightful rejection of
all or part of the lot following seasonable notification to the
seller.
o Cover: The buyer can cancel the contract, purchase substitute
goods, and sue for damages incurred by the new purchase.
o Lawsuit for Money Damages: When the buyer chooses not to
seek cover, she can sue for damages for the difference between
contract and market price at the time of breach.
o Specific Performance: If the goods in question are unique, the
buyer can obtain a court order that compels the breaching party
to perform his obligation under the contract.
 Remedies Following Acceptance of Nonconforming Goods:
o Even though the buyer has accepted the goods, there still
may be a need to protect the buyer’s rights by providing
remedies for relief.
o Revocation of Acceptance: If a buyer does not realize that
the goods are nonconforming and after a cursory inspection
the buyer unknowingly accept the goods, the buyer can

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Chapter 08 - Contracts for the Sale of Goods

recover by revoking acceptance if they act within a

reasonable amount of time.
o Lawsuit for Money Damages: the buyer by making it clear
that the buyer does not give up the right to sue the seller for
the buyer’s damages resulting from the seller’s delivery of
nonconforming goods.
 Risk of Loss
o The law does not allow a seller to shift the risk of loss to
the buyer unless the contract conforms to all the agreed
upon conditions.
Case: 3L Communications v. Merola d/b/a NY Telecom Supply
Facts: 3L Communications (3L) is a merchant that sells high-end optical
telecommunications equipment. Merola does business as NY Telecom Supply
(Merola) and is a wholesaler in the telecommunications equipment business. 3L
entered into an agreement with Merola for 3L to purchase five optical circuit
boards. In accordance with the agreement, Merola shipped the circuit boards via
Federal Express, with the balance of $35,090 due on delivery in the form of a
cashier’s check. The circuit boards arrived at 3L’s office and were paid for as
agreed. However, upon inspection of the circuit boards, 3L discovered that the
boards were damaged and were not as Merola had described. 3L immediately
contacted Merola and notified her that the boards were unusable and that 3L was
returning them. In response, Merola provided shipping instructions and an
account number to be used for returning the goods. 3L followed the shipping
instructions and the boards were returned to Merola’s address. Two weeks later,
3L sent an e-mail message to Merola regarding the refund for the boards. Merola
responded that she had not received the returned boards. 3L then supplied Merola
with tracking information from the carrier that indicated that the boards had been
delivered two weeks earlier. Despite Merola’s insistence that she had not received
the boards, detailed records from the carrier indicated that the goods were, in fact,
delivered.
Issue: Does 3L have the risk of loss for the returned boards?

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Chapter 08 - Contracts for the Sale of Goods

Ruling: No, The court ruled in favor of 3L reasoning that the evidence indicated
that 3L discovered certain problems and seasonably notified Merola of the
problems and ultimately rejected all of the boards as nonconforming with the
parties’ agreement.
Case Questions
1. They had already paid the full amount of the amount due to the seller and
the seller delivered defective goods. When the seller began to lie about
receiving the boards etc., they knew that cure was not an option. Nor did
they necessarily need the boards to continue business.
2. If they had shipped non-conforming, more expensive goods, the seller
would have to give seasonable notice, but the impact of shipping more
expensive goods would likely mean that the seller would have an extended
cure period.
3. Critical Thinking:

Concept Summary: Breach and Remedies in Sales Agreements [P.261]

H. Contracts for the International Sales of Goods [P.262]

Points to emphasize:
 U.N. Convention on Contracts for the International Sale of Goods:
The UNCISG, the international counterpart to the UCC, is a treaty that
governs sales contracts between businesses located in U.N. signatory
countries.
 Coverage and Major Provisions of CISG: The CISG covers contracts
for the sale of goods only between merchants.
o No Writing Required: A totality of the circumstances and
industry practice may be sufficient to prove that an enforceable
contract exists.
o Offer and Acceptance: The offer requires only (1) a brief
description of the goods, (2) quantity, and (3) price; and

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Chapter 08 - Contracts for the Sale of Goods

acceptance may be made within a reasonable time and is

effective only when it is received by the offeror.
o Remedies: The seller has an absolute right and obligation to
cure, and buyers must allow the seller the opportunity to cure
even if the time for performance is past due.
 INCO: International Chamber of Commerce Terms: Standardized
contractual terms and designations used in international sales contracts
to avoid confusion due to language barriers and differing legal
systems.

Concept Summary: Contracts for International Sales of Goods [P. 264]

END OF CHAPTER PROBLEMS, QUESTIONS AND CASES

Chapter Review Questions [P. 266]
Theory to Practice [P. 266]
1. This is a battle of forms question. Here the buyer (GCI/Bentley) issued a
purchase order to the seller (Armstrong). Because this is a merchant
transaction (both parties are merchants), the additional delivery terms written
in by Armstrong become part of the contract unless 1) there was an express
limitation in the original purchase order, or 2) the additional term was a
material change, or 3) the offer raises an objection in a timely manner. Since
there is no indication of a express limitation or objection by Bentley,
Armstrong’s additional terms would be part of the new contract unless they
were deemed a material change (i.e., significantly alters the value of the
contract or the parties’ obligations). [Ties to Agreement in Sales Contracts:
Acceptance].

2. Yes. Course of past dealing is relevant in determining whether agreement

exists under the UCC. Also, if the parties diverged from their previous
practices without agreement from the other party, the different practice may

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Chapter 08 - Contracts for the Sale of Goods

be determined to be a material change to the contract’s terms. [Ties to

Agreement in Sales Contracts: Offer/Acceptance].

3. Assuming that the additional terms added by Armstrong are part of the
contract, the GCI-Armstrong agreement is a destination contract. Under the
UCC, risk of loss in a destination contract passes when the goods are tendered
at the specific destination. In the GCI-Armstrong transaction, title never
passed because the goods were destroyed prior to delivery. Armstrong bears
the risk of loss. This question is tied to Question #1 because it turns on
whether or not Armstrong’s inclusion of additional terms on the purchase
order are part of the contract. If they are not part of the contract, then the GCI-
Armstrong contract is assumed to be a shipment contract and the title passes
once Armstrong placed the goods with the carrier to be shipped. [Ties to Title
and Allocation of Risk].

4. Yes. The statute of frauds is satisfied because the purchase order contained
quantity, signature, and terms indicating an intent to contract. [Ties to Statute
of Frauds].

5. Armstrong has shipped nonconforming goods, but since these nonconforming

goods were newer and more expensive than the conforming goods, Armstrong
has given himself more time to cure if GCI rejects the goods as
nonconforming. GCI is not obligated to accept the substitute goods, but
because Armstrong has acted on a reasonable belief that the newer and more
expensive would be an acceptable substitute, the UCC permits Armstrong a
reasonable time to cure even if the date for performance has passed. [Ties to
Performance of Sales Contracts].

6. Although GCI has accepted the nonconforming goods, they may still revoke
the acceptance of the goods if the nonconformity is found to substantially
impair the value of the goods. Because GCI has discovered the incompatibility

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Chapter 08 - Contracts for the Sale of Goods

of this part of the printing press, they may revoke their acceptance of the
nonconforming goods. [Ties to Buyer’s Rights and Obligations].

7. If GCI rightfully rejects the final shipment of goods based on nonconformity,

they must give notice of the rejection to Armstrong and, subject to
Armstrong’s right to cure, may cancel the contract and recover any money
already paid (such as a deposit). GCI may then purchase substitute goods
(cover) and recover any cover damages as well. [Ties to Remedies Available
to the Buyer].

Strategy 101: The Battle of the Forms [P. 267]

Overview: Can the battle of the forms doctrine be used strategically? 1) limit
liability and 2) use contracts as a tool rather than pre-printed compliance form.
Question: This requires students to apply the material in a hypothetical situation
by drafting contract language that might be used strategically.
Manager’s Challenge [P. 268]
A sample answer to all Manager’s Challenge exercises are provided in the student
and instructor versions of this textbook’s Web site.

Case Summary 8.1: Requirements Contracts and Good Faith: Fisherman

Surgical Instruments, LLC v. Tri-anim Health Services, Inc. [P.268]
1. Fisherman prevails because though quantity is generally a required term
necessary to create an enforceable contract under the UCC, requirements
contract are an exception whereby quantity may be an open term. The
distribution agreement found here was akin to a requirements contract.
2. This is a requirements contract because Tri-anim agreed to buy whatever
he needs from Fisherman, and Tri-anim may only buy from Fisherman.
3. Yes, in this case Fisherman’s cause of action would be that Tri-anim
violated their imposed duty of good faith and they would be entitled to
expectation damages to put them in the position they would have been in
had Tri-anim performed in good faith.

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Chapter 08 - Contracts for the Sale of Goods

Case Summary 8.2: Right of Rejection: General Motors Corp. v. Acme Refining
Co. [P.269]
1. No, the contracted provided that the metal was to be taken “as-is, where-
is,” therefore, GM shipped conforming goods as agreed and Acme has the
duty to accept them and become the owner of the goods in accordance
with concepts of title.
2. No. Acme waited several weeks before properly rejected the goods, when
the buyer has an obligation to affirmatively notify the seller of the
rejection in a timely manner.

Case Summary 8.3: Cover: Glenn Distributors v. Carlisle Plastics, Inc. [P.269]
1. Yes, assuming that Carlisle cannot prove that reasonably similar items were
available and that it would have been reasonable for the purchaser to
acquire them in asserting the affirmative defense.
2. No, Glenn is entitled to lost profits for the specific products he contracted
for and because no similar items were available, he has the right to sue for
damages sustained due to the breach (lost profits).

Case Summary 8.4: Specific Performance: S.W.B. New England, Inc. v. R.A.B.
Food Group, LLC [P. 269]
1. For a court to grant specific performance to SWB, SWB must demonstrate
that it is not feasible for SWB to use cover or a suit for money damages as
a remedy.
2. Most likely, a court would find that these requirements do not apply in this
case. It is likely that alternate brands of kosher products are available to
permit SWB to cover its loss and be compensated by damages based on
the costs of such products, or that, even if Rokeach products are uniquely
desirable in the relevant market, SWB may be fully compensated in
damages for any sales that it loses because of its inability to supply that
brand to its customers.

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Chapter 08 - Contracts for the Sale of Goods

Case Summary 8.5: Battle of the Forms: Movado v. Mozaffarian [P. 270]

1. It was a term incorporated into the document. It cannot be an additional term

because it was not added to the existing document.

2. No. The UCC does not require that one party actually see the document if they
acknowledge the receipt of and agreed to be bound by its terms.

Case Summary 8.6: Commercial Imprac.: Ner Tamid v. Krivoruchko [P. 258]

1. No. Economic conditions cannot be the basis for commercial impractability. It

is a risk for both parties and any shifting of risk must be via agreement in the
contract.
2. This question is intended to spur discussion on the topic of whether economic
risks should be borne more by one party or the other.
3. Financing contingency or shifting the allocation of risk.
4. Additional deposit money until financing was secured.

The Legal Environment of Business, 3e ________________ 8-18

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McGraw-Hill Education.