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We will spend 30 minutes in class on 2/1/05 working on this assignment. 20 minutes will be your attempts to answer the questions; 10 minutes will be saved for discussion. Please read the Code and, where helpful, the Comments carefully in answering the following questions. Cite relevant sections in your answers. I will bring copies of this worksheet to class, though you might want to print this out if you want to study it ahead of time. In order to make this a little easier, we will go one section at a time. One pointer: if you can't figure out the answer, at least isolate the statutory or comment language that is relevant for the example.

2-201

1. A and B are merchants. A manufactures widgets and enters into an oral agreement to sell 10,000 widgets at $1.00 each to B. The next day B sends a confirming letter to A saying:

"This letter confirms our agreement that you will immediately deliver 10,000 widgets to me at $1.00 each. Nice to be working with you."

a. A, upon receiving the letter, reads it, files it away and does nothing. If B later finds the widgets faulty and wants to sue A for breach of contract, can A successfully interpose the defense of the Statute of Frauds, and particularly that A never signed any agreement at all?

b. What if A left for a three-week vacation immediately after orally agreeing on the deal with B. When she arrives back from vacation, her in-box is overflowing and she never gets around to opening the mail. One piece of mail is B's letter from above. Can A argue, if sued for breach of contract, that she never received notice of the deal and that therefore the SoF gives her a winning defense?

c. What if A received and read B's letter and wrote back right away: "Hey B, we never agreed on immediate delivery. Better call me if you still want to deal with me." B never calls. A doesn't produce the widgets. B sues A for breach of contract. Can A successfully interpose the SoF for a defense?

2. A and B are model airplane enthusiasts. At a convention, A orally agreed to sell to B one of his favorite models. They shook on a deal for $3,000. Several people witnessed the deal. A had second thoughts after the convention and never sent the plane, even though B called him repeatedly about it. At the next convention, B told A he still wanted the plane. A sneered and said, "Oh yeah? Bet you can't prove it in court." B then filed a complaint for specific performance (requiring sale of the plane to him), and A answered by filing a MSJ, with the SoF being his chief argument. How will B argue in his responsive pleading or before the court to try to defeat A's reliance on the SoF in his MSJ?

2-207

1. B and S are merchants. B makes yo-yos and S makes string. B wants to buy a lot of string for its yo-yo manufacturing process. B sends an order on its Purchase Order ("PF") form to S for a quantity of string. S acknowledges the quantity, price and delivery time in its Acknowledgment Form ("AF"). Each form has its unique boilerplate language in its own form. If S decides not to send the string after all, will it be in breach of contract? If S delivers but B no longer wants the string, will B be in breach of contract?

2. Let's assume there is a contract and no objection is raised to each other's forms. Let's assume further that string is delivered and used by B to make the yo-yos. B discovers, however, that the string keeps snapping when kids do "around the world." Some injuries have even been reported. B wants to sue S for damages, but S points out the following, rather inconspicuous, clause in its AF:

"Buyer's rights in the event product proves defective are limited to the replacement of defective goods. Under no circumstances is S responsible for consequential damages."

Is this clause binding on B?

Suppose that the AF has no clause regarding B's remedies, but B's PO had the following language:

"S agrees that B may return any product found defective for a full cash refund. S further agrees that B has all traditional common law remedies in law."

Is this clause enforceable against S if S objects in writing to B?

3. With the same parties as before, but with the following change. The PO and AF differ dramatically in the boilerplate, and after an order is placed, S goes ahead and produces the string and sends it to B. B accepts the string and manufactures the yo-yos. The same problem as described above develops. While this is going on, the staff of both B and S are bickering back and forth over whose terms control, but with no final agreement reached before little Johnny Jones takes a mean wallop when his sister Samantha's string to her yo-yo broke when she was rocking the baby in the cradle and the yo-yo landed in her brother's forehead. This accident happened 18 months after the contract was concluded. S's boilerplate limits remedies to a 12 month period, while B's boilerplate has a two-year statute of limitations. Which statute of limitations controls?