Author: Anonymous

Under the common law, a written contract must be signed by the party against whom enforcement is sought.

Ethan purchases a house for $250,000. He borrows $200,000 from StarCross Bank and gives the bank a mortgage on the house for this amount. StarCross Bank fails to record the mortgage. Ethan then applies to borrow $200,000 from Pentalon Bank. Pentalon Bank reviews the real estate recordings and finds no mortgage recorded against the property, so it lends Ethan $200,000. Pentalon Bank records its mortgage. Later, Ethan defaults on both loans. In this case, which of the following would be true in case of the possible foreclosure on the collateral?

Thomas signed a sales contract with Bricklay’s, a firm that supplies bricks for private individuals. The contract specified the type and amount of bricks needed, and that Thomas would pick up the bricks from the Bricklay’s warehouse 15 days later. Thomas received a document of title, but failed to pick up the goods on the stipulated date. In this scenario, at what point of time is the title to goods passed over to Thomas?

The property on which a security interest is taken is called collateral.

The right of a seller or lessor to refuse to send goods to a buyer or lessee upon breach of a sales or lease contract by the buyer or lessee or the insolvency of the buyer or lessee is known as the ________.

Constructive notice is not valid against strangers who assert claims of apparent agency.

Kimberly borrows $50,000 from a bank. She gives the bank a security interest in her ________ inventory. This implies that if Kimberly does not repay the loan in the stipulated period, the bank can claim any assets she purchased after signing the security agreement.

A(n) ________ is a type of contract that requires or authorizes goods to be delivered and accepted in separate lots.

Klint Microsystems, a microprocessor manufacturer, was contracted by Zeitar Studios to manufacture specially designed microchips to be used in an audio engineering process. Zeitar was to pay Klint $300,000 as per the contract. Klint decided to redesign their existing microchips and make them suitable for Zeitar. While the finished microchips were being shipped via a carrier, Klint was informed of Zeitar’s insolvency. Klint cancelled the shipment before it was delivered. Klint then resold the chips to another studio where they had to settle for $150,000 as the chips were now only suitable for specific audio engineering processes.What legal action can Klint take against Zeitar?

Exempt property may not be retained by a debtor who files for bankruptcy.