Failed Product Warranty Claims

Sam owns a hardware store, which sells nearly everything. Taylor comes in looking for some paint that will cover the brick façade around his fireplace. He explains to Sam that the brick can get warm when a fire is blazing but also it can get very cold when there is no fire and the temperatures outside are below freezing. Taylor asks him what is the best paint for this type of work. Sam takes him over to a certain aisle and points to a certain brand and says, “This paint is great for masonry, brick, and stone work inside and out.” Melissa comes into the store right after Taylor and Sam greets her with a “how is the project coming along?” Melissa answers, “Oh, you mean the one where I am restoring some of my grandmother’s porcelain pieces?” Sam replies, “Yes, that one.” “I’m just here to get some porcelain glue for this kind of work.” Melissa goes off down the glue and adhesive aisle that Sam points her toward. In addition to purchasing the glue, Melissa also purchases some Christmas lights on the “as is” ½ price table. When she gets home, the lights are not very bright, and one of the lights dim off and on occasionally. Sam checks Melissa out at the cash register, examining the tube of glue she bought. He doesn’t say a thing other than, “You’re going to use this for porcelain?” Melissa responds, “Yes.” Sam does not respond. Two days later, both Taylor and Melissa come back complaining that the paint and glue failed miserably. Taylor said that as the paint dried, it chipped off the fire place. Melissa said that her porcelain pieces fell apart and crashed to the ground destroying several valuable pieces. Plus, she wants a refund for her Christmas lights. Check All That Apply Taylor sues Sam in small claims court, arguing that Sam breached an express warranty. Sam claims that it is not his fault that the paint was not the correct paint for the job at hand, and Taylor should have carefully read all the labels before choosing. The court finds for Taylor. Is this a correct decision and is this statement by Sam an expressed warranty?Taylor sues Sam in small claims court, arguing that Sam breached an express warranty. Sam claims that it is not his fault that the paint was not the correct paint for the job at hand, and Taylor should have carefully read all the labels before choosing. The court finds for Taylor. Is this a correct decision and is this statement by Sam an expressed warranty? Melissa also sues. She claims that Sam violated his express warranty as well, as evidenced by their conversation. Is this argument legitimate?Melissa also sues. She claims that Sam violated his express warranty as well, as evidenced by their conversation. Is this argument legitimate? Melissa wants a refund on the purchase of the Christmas lights. Sam refuses, claiming that his “as is” sign is a clear disclaimer of implied warranties.

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Wilbur sells exotic and tropical fruit to caterers in the greater metropolitan area. Most of the caterers’ customers are very high-end individuals who are willing to pay high amounts for Wilbur’s fruit. Wilbur gets his fruit from Pacific Gem Company, headquartered in San Francisco. Pacific Gem has been Wilbur’s supplier for over 10 years and knows the nature of Wilbur’s business well and in detail. Wilbur has contracted with Glossier Perfumery, a boutique firm that sells perfumes to high-end customers. Each spring, Glossier hosts a reception for its clients, many of whom are Chinese and Japanese. The centerpiece of the reception is the dragon fruit display with fresh lychees, fruits that are a favorite of the clients. Glossier contracts with Wilbur to provide $*,* of fresh dragon fruit and lychees. Wilbur contracts with Pacific Gem for both the dragon fruit and lychees. Pacific Gem guarantees timely delivery. When the fruit arrives for Wilbur to inspect and then process and ship to Glossier, Wilbur discovers that the refrigeration in the fruit carriers has failed and the fruit are now overripe. While they are not exactly unusable, they are not of the quality that Glossier has come to expect. Wilbur rejects the fruit but cannot send it back as they will completely spoil. So, Wilbur sells the fruit to local restaurants for immediate use. Pacific Gem is unable to replace the fruit. Glossier sues Wilbur for breach of contract and Wilbur sues Pacific Gem. Which of the following is mostly likely true? Check All That Apply Wilbur is able to replace the dragon fruit and lychees from another supplier but at a cost of $*,* which Wilbur passes on to Glossier. Glossier accepts the fruit but refuses to pay the extra $*,*. Wilbur claims that Glossier is liable for that extra money, since the issue with the original fruit shipment was not Wilbur’s fault.Wilbur is able to replace the dragon fruit and lychees from another supplier but at a cost of $*,* which Wilbur passes on to Glossier. Glossier accepts the fruit but refuses to pay the extra $*,*. Wilbur claims that Glossier is liable for that extra money, since the issue with the original fruit shipment was not Wilbur’s fault. Wilbur sues Pacific Gem for the difference of $*,* that Glossier rightfully refused to pay. Wilbur claims that under the doctrine of “cover,” Pacific Gem owes Wilbur the difference in providing the goods to Glossier.Wilbur sues Pacific Gem for the difference of $*,* that Glossier rightfully refused to pay. Wilbur claims that under the doctrine of “cover,” Pacific Gem owes Wilbur the difference in providing the goods to Glossier. Assuming that Pacific Gem did ship conforming fruit to Wilbur, but Wilbur has gotten a better offer for the fruit than the contracted-for price with Glossier. Wilbur refuses to deliver. Glossier claims it can require Wilbur to deliver the fruit and not simply sue for damages.Assuming that Pacific Gem did ship conforming fruit to Wilbur, but Wilbur has gotten a better offer for the fruit than the contracted-for price with Glossier. Wilbur refuses to deliver. Glossier claims it can require Wilbur to deliver the fruit and not simply sue for damages.

Melissa purchased a stereo system from RadioShack. However, five days after Melissa sends a check to RadioShack, RadioShack notifies Melissa that the stereo system requested is no longer available. Melissa issues a stop-payment order to her bank, Bank of America. However, despite the stop-payment order, the bank cashes the check. Melissa pursues a suit against her bank for violating her stop-payment order. The court rules in her favor. But what if the facts of the case were different? Select each set of facts below that could change the outcome of the case. Check All That Apply The stop-payment order was not given so that Bank of America had enough time to instruct its tellers that they should not pay the check.The stop-payment order was not given so that Bank of America had enough time to instruct its tellers that they should not pay the check. The stop-payment order was given orally, and Bank of America cashes the check 20 days later. The stop-payment order was given orally, and Bank of America cashes the check 20 days later. The stop-payment order was in writing, and Bank of America cashed the check 1 month later. The stop-payment order was in writing, and Bank of America cashed the check 1 month later. The check that Melissa paid RadioShack with was a teller’s check.

Ed recently bought organically grown vegetables from Rango, an organic farmer. Ed provided Rango with a draft for the sum of money Rango demanded. Rango then used that draft to buy vegetable seeds from Mary. When Mary sought to claim her payment from Ed, Ed refused, claiming that Rango had sold him a batch of rotten vegetables. Mary sued Ed for breach of contract. After listening to all of the evidence presented by both sides, the court decided that Ed would be obligated to pay Mary, regardless of the quality of vegetables, if the draft met all of the requirements for negotiability. Although an instrument being negotiable is not sufficient to determine that it is enforceable, in this instance, the court assumed that such is the case. The court ruled in favor of Mary, and Ed was ordered to make the payment noted in the draft, as well as pay for Mary’s court fees. But what if the facts of the case were different? Select each set of facts below that could change the outcome of the case. Check All That Apply The draft written by Ed stated that he would pay Rango by giving him * pounds of fruit instead of a sum of money.The draft written by Ed stated that he would pay Rango by giving him * pounds of fruit instead of a sum of money. The draft stated that the “payment would be made 10 days after the specified date.”The draft stated that the “payment would be made 10 days after the specified date.” The court determined that the draft created by Ed explicitly indicated that it was created for the purpose of being transferred unconditionally.The court determined that the draft created by Ed explicitly indicated that it was created for the purpose of being transferred unconditionally. The draft had not been signed by Ed. Instead Ed had written the following on the draft: "I, Ed Philips, promise to pay Rango the sum of $* on Friday, October *, *."The draft had not been signed by Ed. Instead Ed had written the following on the draft: "I, Ed Philips, promise to pay Rango the sum of $* on Friday, October *, *."