Reаd the fоllоwing fаct pаttern and answer the questiоns that follow. Oscar O'Casey has recently graduated from law school and set up his own practice. After a few months of successful practice, he discovers that he needs a software program that will track his time, use of electronic databases, and expenses so that he can generate invoices for clients. He can find no software on the market that suits his needs. Fortunately, he has maintained good relations with Branson Ross, his law school's former technology expert, who now owns and operates a small store, Ross's Hard- and Software. Branson makes most of his money selling computer supplies, but he occasionally does some software design as well. At Oscar's request, Branson develops a software program, "Bill 'em" that is specifically designed to meet Oscar's needs. Branson and Oscar enter into an agreement styled "Software Purchase Agreement." Branson expects to market the software to other local practitioners, so he hires an attorney to draft the Agreement. The Agreement includes a specific description of Bill 'em's purposes and capabilities. The terms of the Agreement provide as follows: • Branson agrees to design the software for $20,000;• Branson will provide on-going service for 24 months (renewable) on an hourly basis at Branson's standard billing rate; • In a section of the Agreement marked "WARRANTY," Branson warrants that the software will function as described in the Agreement;• The warranty includes the following language: "The software includes Branson's standard anti-virus software package, warranted to be 100% effective against known viruses, worms, and other malware or spyware. WHILE NO ANTI-VIRUS SOFTWARE CAN GUARANTEE PROTECTION AGAINST NEW OR UNKNOWN MALICIOUS SOFTWARE, THIS PACKAGE OFFERS SUFFICIENT PROTECTION FOR THE VAST MAJORITY OF BUSINESS USES.• That same section includes the following paragraph in bold type: "Branson disclaims any liability for consequential damages or personal injury. Damages are limited to the original price of the software provided in the Agreement or the cost of repair, whichever is less." Oscar uses the software without any major problems for one year. At that point, Oscar decides to replace his MacBook with a Hewlett Packard computer (a PC). Pursuant to the agreement, Branson updates the software so that it is PC-compatible, and he charges Oscar $1000 for the service. Soon thereafter, because Branson has not protected the software against the sort of viruses that attack PCs (but not Macs), the software develops a fatal error that destroys Bill 'em as well as everything stored on Oscar's hard drive. The computer also overheats. Noticing a strange whirring noise coming from his new computer, Oscar touches its base (central processing unit) to see what is going up. It is so hot that it burns Oscar's hand, an injury that requires reconstructive surgery. Oscar sues Branson, seeking to recover all costs: 1) paid to Branson in connection with the development and services associated with Bill 'em; 2) involved in replacing his computer and lost data; and 3) all medical costs relating to his hand injury. 1. Is the Software Purchase Agreement a contract for the sale of goods or a contract for services (discuss both relevant tests)? (10 points) 2. Regardless of what you conclude in Question 1, if Article 2 applies, what can Oscar recover on a breach of warranty claim and what defenses might Branson raise? (10 points) END OF QUIZ
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