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CHAPTERASSESSMENTSection 1 The Sale and Lease of Goods● The law of sales applies when ownership ofgoods is transferred from a seller to a buyer forconsideration. When a contract includes bothgoods and services, the dominant element of thecontract determines whether it is a contract forgoods or a contract for services.● Special rules for sales include: (1) contracts mayresult from the parties’ conduct; (2) an offer maybe accepted by any reasonable means; (3) anacceptance may include terms that differ fromthose in the offer; (4) the price need not besettled; (5) output and requirements contracts areallowed; (6) contracts may be modified withoutconsideration; and (7) no consideration is neededfor a firm offer.● Contracts for the sale of goods of $500 or moremust be in writing except in: (1) oral contractsbetween two merchants when a confirmation issent and no objection is made; (2) oral contractsfor specially manufactured goods; (3) admissionsin court; and (4) executed oral contracts.● In an auction sale, people place bids that theauctioneer accepts for a sale. In an auction withreserve, the auctioneer need not accept thehighest bid. In an auction without reserve, theauctioneer must accept the highest bid. A bulktransfer occurs when a business transfers allmerchandise and supplies at once. The UCCrequires that the buyer of bulk goods notify all ofthe seller’s creditors at least 10 days before thetransfer will take place.Section 2 Ownership and Risk of Loss inSales of Goods● Title to goods is passed from a seller to a buyerafter the goods have been identified and theseller does what is required under the contract todeliver the goods. The risk of loss is born by theparty responsible for loss or damage to goods.Usually, title and risk pass at the same time.●When a buyer breaches a sales contract, theseller may: (1) cancel the contract; (2) withholddelivery; (3) stop delivery of goods in the possessionof a carrier; (4) resell goods and bringa claim for the difference between the agreedprice and the resale price; (5) bring a claim forthe difference between the agreed price andthe market price; or (6) bring a claim for anygoods that were accepted by the buyer. When aseller breaches a sales contract, the buyer may:(1) cancel the contract; (2) bring a claim for thereturn of any money paid; (3) bring a claim forthe difference between the agreed price and themarket price; (4) reject nonconforming goods;(5) cover the sale; (6) accept nonconforminggoods and bring a claim if no adjustment ismade; and (7) revoke the acceptance.Section 3 E-Commerce and the Law● When shopping on the Internet: (1) shop withcompanies you know; (2) keep your passwordprivate; (3) pay by credit or charge card; and(4) keep a record.● When buying from another country on theInternet, research the currency of prices,shipping policies, delivery time, additional taxesor duties, and customer service policies.● The federal law that permits using electronicsignatures is called E-Sign. Electronic signaturescan be used on a contract if the parties agree todo so.● Legal safeguards that can protect your right tocomputer privacy include: the common law tortof invasion of privacy, your right against unreasonablegovernment intrusion into your privatelife, the Fair Credit Reporting Act, the Right toFinancial Privacy Act, and the Children’s OnlinePrivacy Protection Act.288 Unit 3: Understanding Consumer Law