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The parties dispute the legal effect of a contested transaction. A buyer rejected nonconforming goods after a mixed goods-and-services transaction. The decision maker must choose between a categorical shortcut and a fact-sensitive standard. The parties disagree about the legal effect of those facts. Which option gives the best analysis?

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Treat the formal label attached to the claim or defense as conclusive and disregard facts bearing on the rule's elements. The court should resolve the dispute by applying the operative rule to the material facts: The answer should identify the governing rule for Warranties and apply it to the operative facts. Import a rule from a nearby issue instead of applying the rule triggered by these facts. Reject the claim or defense solely because the opposing party disputes a required fact.

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