1. Helen Thomas contracted to purchase a pool heater from Sunkissed Pools. As part of the $4,000 contract, Sunkissed agreed to install the pool heater, which was delivered to Thomas’s home and left in the driveway. The heater was too heavy for Thomas to lift, and she was forced to leave it in the driveway because no one from Sunkissed responded to her calls about its installation. Subsequently, the heater disappeared from the driveway. Sunkissed maintained that the risk of loss had passed to Thomas. Thomas maintained that the failure to install the heater as promised is a breach of contract. Who should bear the risk for the stolen pool heater?
2. Using a bad check, B purchased a used automobile from a dealer. B then took the automobile to an auction at which the automobile was sold to a party who had no knowledge of its history. When B’s check was dishonored, the dealer brought suit against the party who purchased the automobile at the auction. Was the dealer entitled to reclaim the automobile?
3. Would buying a car from a mechanic who works at a car dealership qualify as purchasing a car in the ordinary course of business?
4. Larsen Jewelers sold a necklace to Conway on a lay- away plan. Conway paid a portion of the price and made additional payments from time to time. The necklace was to remain in the possession of Larsen until payment was fully made. The Larsen jewelry store was burglarized, and Conway’s necklace and other items were taken. Larsen argued that Conway must bear the risk of loss. Conway sought recovery of the full value of the necklace. Decide.
5. Future Tech International, Inc., is a buyer and distributor of Samsung monitors and other computer products. In 1993, Future Tech determined that brand loyalty was important to customers, and it sought to market its own brand of computer products. Future Tech, a Florida firm, developed its own brand name of MarkVision and entered into a contract in 1994 with Tae II Media, a Korean firm. The contract provided that Tae II Media would be the sole source and manufacturer for the MarkVision line of computer products. The course of performance on the contract did not go well. Future Tech alleged that from the time the ink was dry on the contract, Tae II Media had no intention of honoring its commitment to supply computers and computer products to Future Tech. Future Tech alleged that Tae II Media entered into the contract with the purpose of limiting Future Tech’s competitive ability because Tae II Media had its own Tech Media brand of computers and computer products. Future Tech, through threats and demands, was able to have the first line of MarkVision products completed. Tae II Media delivered the computers to a boat but, while in transit, ordered the shipping line (Maersk Lines) to return the computers. The terms of their contract provided for delivery “FOB Pusan Korea.” Future Tech filed suit, claiming that Tae II Media could not take the computer products because title had already passed to Future Tech. Is this interpretation of who has title correct?
6. Brown Sales ordered goods from Eberhard Manufacturing Co. The contract contained no agreement about who would bear the risk of loss. There were no shipping terms. The seller placed the goods on board a common carrier with instructions to deliver the goods to Brown. While in transit, the goods were lost. Which party will bear the loss? Explain.