This examination is an open-book exam. You may bring to the examination room any written materials except materials checked out from the law library.

Assume that the 1995 official text of the Uniform Commercial Code is in force in all relevant jurisdictions unless otherwise expressly indicated.

Read the question carefully and organize your answer before you begin to write. Emphasize those points you think are most significant. If you find an ambiguity in the statement of facts or if you need more facts, make reasonable assumptions and state them clearly. Be concise. Be clear. Good luck!

Samuel Clemens owns and operates a small printing business. In April 1993, Mr. Clemens purchased a Chrysler Airtemp air conditioner for his business premises. He purchased the air conditioner from Allied Air Conditioning Company ("Allied"), a dealer for the Airtemp Division of Chrysler Corporation ("Chrysler"). Allied promptly installed the air conditioner.

The written sales contract stated on the first page:

"ALLIED DISCLAIMS ALL WARRANTIES EXPRESS OR IMPLIED, INCLUDING ANY IMPLIED WARRANTY OF MERCHANTABILITY OR ANY IMPLIED WARRANTY OF FITNESS FOR A PARTICULAR PURPOSE."

At the time it installed the air conditioner, Allied handed to Mr. Clemens a copy of the Chrysler warranty documentation. The documentation stated:

Chrysler Corporation warrants its AD100 Air Conditioning Unit to be free of defects in workmanship and material under normal use and service. Chrysler's obligation under this warranty is limited solely to repairing or replacing parts F.O.B. Dayton, Ohio, which in its judgment are defective in workmanship or material and which are returned, freight prepaid, to its Dayton, Ohio plant or other designated point. The above warranty applies for a period of one year from date of original installation. The Hermetic Compressor is warranted for a period of five (5) years from date of original installation. CHRYSLER MAKES THIS WARRANTY IN LIEU OF ALL OTHER WARRANTIES, EXPRESS OR IMPLIED. In no event shall Chrysler be liable for special or consequential damages.

During the first two months the unit worked erratically. Allied promptly responded to six service calls during these months but was unable to fix the problem. In July 1993 Allied replaced the unit's compressor and the unit then operated properly until June 1997.

When the compressor broke down in June 1997, Allied refused to make repairs to the unit. Chrysler agreed to replace the compressor, but insisted that it could replace the compressor with a rebuilt compressor rather than a new one. Mr. Clemens, on the other hand, is willing to pay the freight charges but insists that he is entitled to a new substitute compressor.

Frustrated by Allied's refusal to repair and Chrysler's failure to install a new compressor, Mr. Clemens now consults you. Advise him on what rights he may have against Allied and Chrysler.