Quiz 13: The Formation of Sales and Lease Contracts
Facts: The facts deal with the tax payment issue posed by e-commerce companies and the amount of loss borne by the federal government every year. The Federal government is suffering huge losses every year because E-Commerce Companies are avoiding payment of taxes to the government. Laws for E-Commerce Companies: The laws enacted by the government and the common law are not able to restrict the tax evasion practices of the E-commerce companies. The law advocates that the e-commerce companies need to get registered at one place and pay taxes as per the tax laws applicable in the state. Outcome: The cities and states are not able to file cases against the E-Commerce Companies because these giants are registered in multiple locations. Thus, the states and cities are unable to decide which state law and tax rate to be applied to the Company. The situation of E-Commerce Companies in multiple locations makes it hard for the governments to find out if the company had actually paid the tax in a particular state or not. When the government is not able to discover which company has paid its tax and which had not, it cannot bring suits against the defaulting companies. Thus, it can be concluded that cities and states are unable to file cases against the E-Commerce Companies because these companies are located in more than one locations.
When breaching takes place of a sale or lease contract then the transferring of the risk will function very differently which will depend completely as to which party has breached. Normally the party that was involved in the breaching will have to bear the complete risk of the loss. In the case when the breaching is done by the seller or the lessor and if the goods are not confirmed then the buyers will have the right to decline the possession of the goods. In case of acceptance of a consignment of the goods and afterwards realises that there is some sought of fault in the goods then at that time the acceptance of the goods can be cancelled. Cancellation of the goods will permit the risk of loss to be transferred to the seller by the buyer and to the degree where the insurance of the buyer will not cover the entire loss. Therefore in this case also if the E-Design, Inc accepts the 150 printer stands and afterwards if any fault is detected then the order can actually be cancelled. But in the case if Fav-O-Rite had informed the E-Design that it was going to send the printer stand then the acceptance would not be based on nonconforming as the E- Design could cancel the order before it was shipped.
The Article of the UCC manages the contracts based on the sales or it manages those contracts that are concerned with the transaction of various goods. For the facilitation of the transactions, which are for profit making purposes, Article 2 makes amendments in some of the contract requirements based on common laws. The main point of focus over here is that the Article 2 is concerned directly with the sale of the goods and it is not concerned with the real property, it doesn't deal with services or even the stocks or the bonds that are known as the intangible property. The Article 2A of the UCC manages the leases. Nowadays the leases that are concerned with the goods have become very widespread. Lease can actually be explained as the transferring of the right for the utilisation of a good that a person possesses for payment for a particular period of time. The particular transactions that are concerned with the Article 2 are the ones that will create a lease for a particular good and along with that a sublease for the good will also be created. Article 2 is usually applied to the lease rather than to the sale of the particular good. Article 2 A is a replication of the article 2 and it is different only when it has to reveal the difference that exists between the lease and the sales transactions.
There is no answer for this question