Davis Co.and Ruby Creations enter an oral contract providing that Ruby will deliver three dozen dresses to Davis at $20 per dress.The next day, Davis sent Ruby a letter signed by Davis's purchasing agent confirming the quantity and item, but not mentioning the price.Which of the following is true?
A) Ruby Creations and Davis Co. were bound in an enforceable contract at the time they entered the oral agreement.
B) Davis is bound by the contract when its authorized agent sends the letter, but Ruby Creations is bound by the oral contract ten days after receiving the letter, unless it objects in writing within that time.
C) Davis Co. is not bound by the terms of the letter unless Ruby responds in writing to verify the agreement.
D) The parties cannot be bound by the contract because the price term was missing from the written confirmation.

Question

Quizplus · Accepted Answer

Under the Uniform Commercial Code (UCC), an oral contract for the sale of goods can be binding. When one party sends a written confirmation of the agreement to the other party, and if the receiving party does not object in writing within 10 days, the terms stated in the confirmation become binding on both parties. This rule applies even if the written confirmation does not include all the terms of the oral agreement, such as the price in this case.

Davis CoAnd Ruby Creations Enter an Oral Contract Providing That Ruby