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Exam 21: Title Risk and Insurable Interest

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Question 31

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Identification is one of the concepts involved in determining the rights and liabilities of parties to a sales contract.

A) True
B) False

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Question 32

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Regional Freight LLC delivers a receipt issued by Storage Warehouse for goods stored in its facility to Transnational Inc., a buyer of the goods. This is

A) a bill of lading.
B) a destination contract.
C) a shipment contract.
D) a warehouse receipt.

E) All of the above
F) B) and C)

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Question 33

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Identification is the express designation of the goods provided for in a contract.

A seller's title to goods being sold is voidable if the goods

Generally, the buyer acquires whatever title the seller has to the goods sold.

If a person buys cattle at a livestock auction, unless the parties agree otherwise, title will pass to the buyer when the cattle are physically delivered.

In a destination contract, risk of loss passes to the buyer or lessee when the goods are delivered to the carrier.

After title passes to a buyer, a seller no longer has an insurable interest in the goods.

Runners Feet, a shoe store, orders one hundred pair of athletic shoes from Speedster Inc. Absent a contrary agreement between the parties, title will pass to Runners Feet when

In the following situations, two parties claim the same goods. Who is most likely to prevail in each circumstance? Explain. (a)Czeslaw steals Denise's Ultra HD TV set and sells it to Ezra, an innocent purchaser, for value. Denise learns that Ezra has the set and demands its return. (b)Gwendolyn takes her all-terrain vehicle (ATV)for repair to Hank's Sales & Repair, a merchant who fixes and sometimes sells used ATVs. One of Hank's employees sells Gwendolyn's ATV to John, an innocent purchaser-customer, who takes possession. Gwendolyn wants her ATV back from John.

In most situations involving sales or leases, rights and liabilities are generally not determined by who has title to the goods.

Quest Outdoor Store orders a specified size of RiverRun-brand rafts from Sports Merchandise, Inc. Sports Merchandise mistakenly ships rafts of the wrong size, which Quest rejects and returns via Trans-State Shipping. During the return, the rafts are lost. The loss is suffered by

The UCC's provisions relating to passage of title do not apply to leases of goods.

Red Bev LLC contracts to buy two tons of strawberries from Sweet Fruits, Inc. The contract states that Sweet Fruits is required to ship the strawberries to Red Bev by Truck Transport Inc. The contract is

Identification gives

Organic Café orders five gallons of PureMaid-brand olive oil from Quico Oil Inc. Quico mistakenly ships Pure soy oil, which Organic keeps, despite the nonconformity. The oil is destroyed in a fire. The loss is suffered by

An insurable interest is

EverSafe Corporation in New York sells a truckload of protective suits, masks, and other safety gear to Foundry Inc. in Connecticut, "F.O.B. New York." EverSafe arranges with Geo Truckline to transport the goods. The cost of the transport will be paid by

Commercial Rents Corporation agrees to lease a pressure washer to Delivery Trucks Inc., which agrees to pick it up at E Street Warehouse. Before Delivery Trucks retrieves the washer, it is stolen. The loss is suffered by

An owner in common of fungible goods can pass title and risk of loss to the buyer only by actually separating the goods.