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Open Posted By: ahmad8858 Date: 03/03/2021 Graduate Assignment Writing

 

A manufacturer of an electric meter that included surge protectors to prevent damage to the meter from overloads is sued exclusively for strict product liability by an electric company after the surge protectors failed and damaged the electric meters. The manufacturer defends the claim of strict product liability on the basis that the defect in the product only damaged the product itself and there were no personal injuries.

How strong is this defense by the manufacturer?

  • Strong, because strict product liability does not allow for economic loss occasioned from a defect in a product that only causes damage to the product itself.
  • Weak, because strict product liability applies to defective products even when they do not cause personal injuries or damage a company's property.
  • Strong, unless the electric company can provide a reasonable alternative design to the meter that would have mitigated the risk of the surge protectors failing.
  • Weak, because there is no indication that the electric company was aware of the product's defective surge protectors and elected to use the meters anyway.
Category: Engineering & Sciences Subjects: Electrical Engineering Deadline: 12 Hours Budget: $120 - $180 Pages: 2-3 Pages (Short Assignment)

Attachment 1

Unit 2 Tutorials: Bases of Liability INSIDE UNIT 2

Contracts

General Perspectives on Contracts

Sources of Contract Law

Different Types of Contracts

Contract Formation

Unenforceable Contracts

Statute of Frauds

Contract Remedies

Monetary Awards

Equitable Remedies: Specific Performance and Injunction

Remedies in General Under the Uniform Commercial Code

Seller's Remedies Under the Uniform Commercial Code

Buyer's Remedies Under the Uniform Commercial Code

Limitations on Contract Remedies

Torts

Introduction to Tort Law

Intentional Torts

Negligent Torts: Liability

Negligent Torts: Damages and Defenses

Theories of Strict Tort Liability

Strict Liability

Products Liability

Negligent Products Liability

Strict Products Liability

Problems with Strict Products Liability

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General Perspectives on Contracts

by Sophia Tutorial

In this lesson, you will learn about contracts as a legal concept, and the role they take in society.

Specifically, this lesson will cover:

1. Historical View of Contracts

2. Economic View of Contracts

1. Historical View of Contracts

The contract is probably the most familiar legal concept in our society because it is so central to our political,

economic, and social life. In conversation, the term is used interchangeably with agreement, bargain,

undertaking, or deal; but whatever the word, it embodies our notion of freedom to pursue our own lives

together with others.

Contracts are central because they are the means by which a free society orders what would otherwise be

disorder. So commonplace is the concept of contract - and our freedom to make contracts with each other -

that it is difficult to imagine a time when contracts were rare, an age when people’s everyday associations

with one another were not freely determined and agreed upon.

Yet in historical terms, it was not so long ago that contracts were rare, entered into if at all by very few.

IN CONTEXT

In “primitive” societies and in medieval Europe, from which our institutions sprang, the relationships

among people were largely fixed; traditions spelled out duties that each person owed to family,

tribe, or manor.

The movement toward contracts, then, went hand-in-hand with the emerging industrial order from

the fifteenth to the nineteenth centuries, as England, especially, evolved into a booming mercantile

economy with all that that implies— flourishing trade, growing cities, an expanding monetary system,

commercialization of agriculture, and mushrooming manufacturing. Contract law was created out of

necessity.

Not until the nineteenth century, in both the United States and England, did a full-fledged law of contracts

arise together with modern capitalism.

 BIG IDEA

WHAT'S COVERED

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Contract law did not develop according to a conscious, intentional plan. It was a response to changing

conditions, and the judges who created it frequently resisted, preferring the quieter, imagined pastoral life of

their forefathers.

2. Economic View of Contracts

In "An Economic Analysis of Law" (1973), Judge Richard A. Posner (a former University of Chicago law

professor) suggests that contract law performs three significant economic functions:

1. It helps maintain incentives to individuals to exchange goods and services efficiently.

2. It reduces the costs of economic transactions because its very existence means that the parties need not

go to the trouble of negotiating a variety of rules and terms already spelled out.

3. The law of contracts alerts the parties to trouble spots that have arisen in the past, thus making it easier

to plan the transactions more intelligently and avoid potential pitfalls.

In this lesson, you were introduced to the historical view of contracts, learning that a contract is the

mechanism by which people in modern society make choices for themselves, as opposed to being

born or placed into a status. You also learned about the economic view of contracts, in which the

contract serves several specific economic purposes.

Best of luck in your learning!

Source: This content has been adapted from Lumen Learning's "General Perspectives on Contracts" tutorial.

SUMMARY

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Sources of Contract Law

by Sophia Tutorial

In this lesson, you will learn more about where contract law comes from. Specifically, this lesson will

cover:

1. Case (Common) Law and the Restatement of Contracts

2. Statutory Law and the Uniform Commercial Code

a. A Brief History of the UCC

b. The Basic Framework of the UCC

3. Three Basic Contract Types

4. The Convention on Contracts for the International Sale of Goods

1. Case (Common) Law and the Restatement of Contracts

Because contract law was forged in the common law courtroom, hammered out case by case by individual

judges, it grew in the course of time to house volumes of written decisions. By the early twentieth century,

tens of thousands of contract disputes had been submitted to the courts for resolution, and the published

opinions, if collected in one place, would have filled dozens of bookshelves. Clearly this mass of case law was

too unwieldy for efficient use.

A similar problem had developed in the other leading branches of the common law. Disturbed by the

profusion of cases and the resulting uncertainty of the law, a group of prominent American judges, lawyers,

and teachers founded the American Law Institute in 1923 to attempt to clarify, simplify, and improve the law.

One of its first projects, and ultimately one of its most successful, was the drafting of the Restatement of the

Law of Contracts, completed in 1932. A revision, the Restatement (Second) of Contracts, was undertaken in

1946 and finally completed in 1979.

The Restatements (others exist in the fields of torts, agency, conflicts of laws, judgments, property, restitution,

security, and trusts) are a detailed collection of the law embodied in these decided cases. They are broken

down into various principles that have emerged from the courts, and to the maximum extent possible, the

Restatements declare the law as the courts have determined it to be.

The Restatement of Contracts won prompt respect in the courts and has been cited in innumerable cases.

The Restatements are not authoritative, in the sense that they are not statutes or actual judicial precedents,

but they are nevertheless weighty interpretive texts, and judges frequently look to them for guidance. They

are as close to “black letter” rules of law as exist anywhere in the American legal system for judge-made

(common) law.

WHAT'S COVERED

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 TERM TO KNOW

Restatement of the Law of Contracts

A summary of U.S. case law regarding contracts compiled by the American Law Institute and considered to be

authoritative. It is currently in its second form as the Restatement (Second) of the Law of Contracts.

2. Statutory Law and the Uniform Commercial Code

Common law contract principles govern contracts for real estate and for services, obviously very important

areas of law. But in one area, the common law has been superseded by an important statute: the Uniform

Commercial Code (UCC), especially Article 2, which deals with the sale of goods.

 TERM TO KNOW

Uniform Commercial Code (UCC)

A uniform act relating to commercial law that has, over time, been adopted in all 50 states, the District of

Columbia, and U.S. territories. It is not a federal law, but its adoption throughout the U.S. makes interstate

commercial transactions harmonious, although not all states have adopted all parts of the UCC.

2a. A Brief History of the UCC

The UCC is a model law developed by the American Law Institute and the National Conference of

Commissioners on Uniform State Laws; it has been adopted in one form or another in all fifty states, the

District of Columbia, and the American territories. It is the only “national” law not enacted by Congress.

Before the UCC was written, commercial law varied, sometimes greatly, from state to state. This first proved a

nuisance and then a serious impediment to business as the American economy became nationwide during the

twentieth century.

Although there had been some uniform laws concerned with commercial deals - including the Uniform Sales

Act, first published in 1906 - few were widely adopted and none nationally. As a result, the law governing sales

of goods, negotiable instruments (such as a check drawn on a bank), warehouse receipts, securities, and

other matters crucial to doing business in an industrial, market economy was a crazy quilt of untidy provisions

that did not mesh well from state to state.

But in so doing, many of these states changed particular provisions. As a consequence, the Uniform

Commercial Code was no longer so uniform. Responding to this development, the American Law Institute

established a permanent editorial board to oversee future revisions of the code.

Various subcommittees went to work redrafting, and a 1962 Official Text was eventually published. Twelve

more states adopted the code, eleven of them the 1962 text. By 1966, only three states and two territories had

failed to enact any version: Arizona, Idaho, Louisiana, Guam, and Puerto Rico.

Meanwhile, non-uniform provisions continued to be enacted in various states, particularly in Article 9, Secured

Transactions, to which many amendments have been made. In 1971, a redraft of that article was readied and

the 1972 Official Text was published. By that time, Louisiana was the only holdout. Two years later, in 1974,

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Louisiana made the UCC a truly national “law” when it enacted some, but not all, of the 1972 text (significantly,

Louisiana has not adopted Article 2, Sales).

Additional major changes were made in 1978 and 1994 to Article 8, Investment Securities, necessitated by the

electronics revolution that led to new ways of transferring investment securities from seller to purchaser.

Beginning in 1998, various changes have been made to Article 9, "Secured Transactions," which are like

mortgages or liens that provide security for debts and obligations.

From this brief history, it is clear that the UCC is now a basic law of relevance to every business and business

lawyer in the United States, even though it is not entirely uniform because different states have adopted it at

various stages of its evolution— an evolution that continues still.

2b. The Basic Framework of the UCC

The UCC embraces various aspects of “commercial transactions,” that may include, for example, the making

of a contract for the sale of goods, the signing of a check, the endorsement of the check, and so on. However,

the UCC presupposes that each of these transactions is a facet of one single transaction: the sale of and

payment for goods. The Code deals with phases of this transaction from start to finish.

These phases are organized according to the following “articles,” which have had to evolve quickly in recent

years due to the high impact of technology:

Sales: Article 2

Leases: Article 2A

Negotiable Instruments (formerly Commercial Paper): Article 3

Bank Deposits and Collections: Article 4

Funds Transfers: Article 4A

Letters of Credit: Article 5

Bulk Sales: Article 6

Documents of Title: Article 7

Investment Securities: Article 8

Secured Transactions: Article 9

We now turn our attention to the sale— the first facet, and the cornerstone, of the commercial transaction.

Sales law is a special type of contract law in that Article 2 applies only to the sale of goods, defined (Section

2-105) in part as “all things... which are movable at the time of identification to the contract for sale other than

the money in which the price is to be paid....” Thus, the only contracts and agreements covered by Article 2

are those relating to the present or future sale of goods (as opposed to a sale of services or real estate).

In certain cases, the courts have difficulty in determining the nature of the object of a sales contract. How can

goods and services be separated in contracts calling for the seller to deliver a combination of goods and

services?

This difficulty frequently arises in product liability cases in which the buyer sues the seller for breach of one of

the UCC warranties.

 EXAMPLE You go to the hairdresser for a permanent and the shampoo gives you a severe scalp rash.

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May you recover damages on the grounds that either the hairdresser or the manufacturer breached an

implied warranty in the sale of goods?

 EXAMPLE Say a contract involves delivery of materials, such as hauling a load of stones for a construction project. In such cases, a court may have difficulty determining if the contract is actually for

services or for materials (goods). The UCC will probably not apply if labor is a significant part of the

contract.

 TERM TO KNOW

Sale of Goods

Contracts covered by Article 2 of the Uniform Commercial Code involving the sale of goods between

merchants where title passes from seller to buyer for a price.

3. Three Basic Contract Types

With this brief description of the UCC, it should now be clear that the primary sources of law for the three

basic types of contracts are:

Real estate: common law

Services: common law

Sale of goods: UCC (as interpreted by the courts)

Common law and UCC rules are often similar.

 EXAMPLE Both require good faith in the performance of a contract.

However, there are two general differences worth noting between the common law of contracts and the

UCC’s rules governing the sales of goods:

1. The UCC is more liberal than the common law in upholding the existence of a contract.

 EXAMPLE In a sales contract (covered by the UCC), “open” terms, or terms that the parties have not agreed upon, do not require a court to rule that no contract was made. However, open terms in a non-

sales contract will frequently result in a ruling that there is no contract.

2. Although the common law of contracts applies to every person equally, “merchants” sometimes receive

special treatment under the UCC, particularly where it concerns formation of a contract. By “merchants,” the

UCC means persons who have special knowledge or skill and who deal in the goods involved in the

transaction.

4. The Convention on Contracts for the International Sale of Goods

A Convention on Contracts for the International Sale of Goods (CISG) was approved in 1980 at a diplomatic

conference in Vienna. (A convention is a preliminary agreement that serves as the basis for a formal treaty.)

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The Convention has been adopted by several countries, including the United States.

The Convention is significant for three reasons:

1. The Convention is a uniform law governing the sale of goods— in effect, an international Uniform

Commercial Code. The major goal of the drafters was to produce a uniform law acceptable to countries with

different legal, social, and economic systems.

2. Second, although provisions in the Convention are generally consistent with the UCC, there are significant

differences.

 EXAMPLE Under the Convention, consideration is not required to form a contract, and there is no Statute of Frauds (a requirement that some contracts be evidenced by a writing to be enforceable).

3. Finally, the Convention represents the first attempt by the U.S. Senate to reform the private law of business

through its treaty powers, for the Convention preempts the UCC if the parties to a contract elect to use the

CISG.

In this lesson, you learned that the main sources of contract law are case (common) law and the

Restatement of Contracts, statutory law via the Uniform Commercial Code for contracts involving

the sale or leasing of goods, and treaty law via the Convention on Contracts for the International

Sale of Goods.

There are three basic contract types: real estate, services, and sale of goods. Common law is the

primary source for real estate and services contracts, while the UCC is the primary source for

contracts involving the sale of goods. You also learned a brief history and the basic framework of the

UCC to gain a better understanding of how it applies to specific contracts.

Best of luck in your learning!

Source: This content has been adapted from Lumen Learning's "General Perspectives on Contracts" tutorial.

Restatement of the Law of Contracts

A summary of U.S. case law regarding contracts compiled by the American Law Institute and considered to

be authoritative. It is currently in its second form as the Restatement (Second) of the Law of Contracts.

Sale of Goods

Contracts covered by Article 2 of the Uniform Commercial Code involving the sale of goods between

merchants where title passes from seller to buyer for a price.

Uniform Commercial Code (UCC)

A uniform act relating to commercial law that has, over time, been adopted in all 50 states, the District of

SUMMARY

TERMS TO KNOW

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Columbia, and U.S. territories. It is not a federal law, but its adoption throughout the U.S. makes interstate

commercial transactions harmonious, although not all states have adopted all parts of the UCC.

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Different Types of Contracts

by Sophia Tutorial

In this lesson, you will learn about the classifications of several common types of contracts and their

functions. Specifically, this lesson will cover:

1. Contract Classifications

2. Explicitness

a. Express Contracts

b. Implied Contracts

c. Quasi-Contracts

3. Mutuality

a. Bilateral Contracts

b. Unilateral Contracts

4. Enforceability

a. Illegal Contracts

b. Voidable Contracts

c. Unenforceable Contracts

5. Degree of Completion

a. Executory Contract

1. Contract Classifications

Contracts are not all cut from the same die. Some are written, some are oral; some are explicit, some are not.

Because contracts can be formed, expressed, and enforced in a variety of ways, a taxonomy of contracts has

developed that is useful in lumping together similar legal consequences.

In general, contracts are classified along these dimensions:

Explicitness

Mutuality

Enforceability

Degree of completion

We will examine each of these concepts in turn.

2. Explicitness

WHAT'S COVERED

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Explicitness is concerned with the degree to which the agreement is manifest to those not party to it.

Explicit contracts include:

Express contracts

Implied contracts

Quasi-contracts

 TERM TO KNOW

Explicitness

The requirement that a contract, whether express or implied, be clearly stated and understandable to those

not a party to it.

2a. Express Contracts

An express contract is one in which the terms are spelled out directly.

The parties to an express contract, whether written or oral, are conscious that they are making an enforceable

agreement.

 EXAMPLE An agreement to purchase your neighbor’s car for $500 and to take title next Monday is an express contract.

 TERM TO KNOW

Express Contract

A contract that is expressed in words, either oral or written, with all of its terms set forth.

2b. Implied Contracts

An implied contract is one that is inferred from the actions of the parties.

Although no discussion of terms took place, an implied contract exists if it is clear from the conduct of both

parties that they intended there be one.

 EXAMPLE A delicatessen patron who asks for a “turkey sandwich to go” has made a contract and is obligated to pay when the sandwich is made. By ordering the food, the patron is implicitly agreeing to the

price, whether posted or not.

 TERM TO KNOW

Implied Contract

A contract that is inferred from the parties’ actions demonstrating their intent to enter into a contract but

without expressing it in words. An example is ordering food in a restaurant and expecting to pay for it.

2c. Quasi-Contracts

Both express and implied contracts embody an actual agreement of the parties. A quasi-contract, by contrast,

is an obligation said to be “imposed by law” in order to avoid unjust enrichment of one person at the expense

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of another.

In fact, a quasi-contract is not a contract at all; it is a fiction that the courts created to prevent injustice.

 EXAMPLE Suppose that a carpenter mistakenly believes you have hired him to repair your porch; in fact, it is your neighbor who has hired him. One Saturday morning, he arrives at your doorstep and begins

to work. Rather than stop him, you let him proceed, pleased at the prospect of having your porch fixed for

free (since you have never talked to the carpenter, you figure you need not pay his bill). Although it is true

there is no contract, the law implies a contract for the value of the work.

 TERM TO KNOW

Quasi-Contract

A legal fiction that recognizes legal obligations even when parties did not overtly agree to a contract to avoid

unjust enrichment. An example would be babysitting services provided for a parent who had to be rushed to a

hospital.

3. Mutuality

Mutuality takes into account whether promises are exchanged by two parties or only one.

 TERM TO KNOW

Mutuality

The requirement that a contract contain mutual promises or obligations.

3a. Bilateral Contracts

The garden-variety contract is a bilateral contract, in which the parties make mutual promises.

Each is both promisor and promisee; that is, each promises to do something and each is the recipient of such

a promise.

 TERM TO KNOW

Bilateral Contract

A contract where both parties have an obligation to perform, as in the sale of a house where buyer pays

money and seller conveys title to the house.

3b. Unilateral Contracts

While common, mutual promises are not necessary to constitute a contract. Unilateral contracts, in which only

one party makes a promise, are equally valid but depend upon performance of the promise to be binding.

 EXAMPLE If Charles says to Fran, “I will pay you five dollars if you wash my car,” Charles is contractually bound to pay once Fran washes the car. Fran never makes a promise, but by actually

performing, she makes Charles liable to pay.

 EXAMPLE Ella sees a sign that offers $50 for the return of a lost dog. Ella never makes a promise to

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the offeror, but if she looks for the dog and finds it, she is entitled to the $50.

 TERM TO KNOW

Unilateral Contract

A contract where only one party makes a promise and is not binding on the other party until performance

occurs. An example would be a reward for a lost pet. No one is obligated to find the pet, but when someone

does, the promise of a reward becomes binding.

4. Enforceability

Enforceability is the degree to which a given contract is binding. Not every agreement between two people is

a binding contract.

 TERM TO KNOW

Enforceability

The degree to which a given contract is binding.

4a. Illegal Contracts

An agreement that is lacking one of the legal elements of a contract is said to be void— that is, not a contract

at all.

 EXAMPLE A promise to commit a crime in return for a monetary payment is an illegal agreement; therefore, it is void.

Neither party to a void “contract” may enforce it.

 TERM TO KNOW

Illegal Agreement

A contract that is not valid or enforceable since its object is illegal, as in a promise of payment for doing

something illegal. Such a contract is void.

4b. Voidable Contracts

By contrast, a voidable contract is one that is unenforceable by one party but enforceable by the other.

A minor (any person under eighteen, in most states) may "avoid" a contract with an adult; the adult may not

enforce the contract against the minor if the minor refuses to carry out the bargain. But the adult has no choice

if the minor wishes the contract to be performed. Note, however, that a contract may be voidable by both

parties if both are minors.

Ordinarily, the parties to a voidable contract are entitled to be restored to their original condition.

 EXAMPLE Suppose you agree to buy your seventeen-year-old neighbor’s car. He delivers it to you in exchange for your agreement to pay him next week. He has the legal right to terminate the deal and

recover the car, in which case you will of course have no obligation to pay him. If you have already paid

him, he still may legally demand a return to the status quo ante (previous state of affairs). You must return

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the car to him; he must return the cash to you.

A voidable contract remains a valid contract until it is voided. Thus, a contract with a minor remains in force

unless the minor decides he does not wish to be bound by it. When the minor reaches his majority, he may

“ratify” the contract - that is, agree to be bound by it - in which case the contract will no longer be voidable

and will thereafter be fully enforceable.

 TERM TO KNOW

Voidable Contract

A contract that is unenforceable by one party but enforceable by the other party, as in a contract made with a

minor.

4c. Unenforceable Contracts

An unenforceable contract is one that some rule of law bars a court from enforcing.

 EXAMPLE Tom owes Pete money, but Pete has waited too long to collect it and the statute of limitations has run out. The contract for repayment is unenforceable and Pete is out of luck, unless Tom

makes a new promise to pay or actually pays part of the debt. However, if Pete is holding collateral as

security for the debt, he is entitled to keep it; not all rights are extinguished because a contract is

unenforceable.

5. Degree of Completion

Completion considers whether the contract is yet to be performed or the obligations have been fully

discharged by one or both parties.

 EXAMPLE Suppose John agrees to sell Humphrey a quantity of wheat in one month. On the appointed day, Humphrey refuses to take the wheat or to pay. The law of contracts holds that a valid

contract exists and that Humphrey is required to pay John.

5a. Executory Contract

An agreement consisting of a set of promises is called an executory contract before either promise is carried

out. Most executory contracts are enforceable.

If one promise or set of terms has been fulfilled (e.g., if John had delivered the wheat to Humphrey), the

contract is called partially executed. A contract that has been carried out fully by both parties is called an

executed contract.

 TERMS TO KNOW

Executory Contract

A contract for which performance has not yet been completed.

Executed Contract

A contract that has been carried out fully by both parties.

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In this lesson, you learned that contracts are classified based on their explicitness, mutuality,

enforceability, and degree of completion. Contracts have different degrees of explicitness, or clarity

and apparentness to third parties, that range from express to implied. Quasi-contracts, however,

represent legal obligations rather than actual agreements.

Contracts also have different degrees of mutuality, because they can be either bilateral or unilateral.

Enforceability is a third dimension by which contracts are classified. Most contracts are binding unless

they are illegal, but some are voidable or unenforceable in certain circumstances. Lastly, contracts

differ based on their degree of completion, meaning whether they are executory or executed.

Best of luck in your learning!

Source: This content has been adapted from Lumen Learning's "General Perspectives on Contracts" tutorial.

Bilateral Contract

A contract where both parties have an obligation to perform, as in the sale of a house where buyer pays

money and seller conveys title to the house.

Enforceability

The degree to which a given contract is binding.

Executed Contract

A contract that has been carried out fully by both parties.

Executory Contract

A contract for which performance has not yet been completed.

Explicitness

The requirement that a contract, whether express or implied, be clearly stated and understandable to those

not a party to it.

Express Contract

A contract that is expressed in words, either oral or written, with all of …