Delivery & Risk of Loss in UCC Ks - Shipment by Carrier (Shipment Ks)
Seller only obligated to ship goods to buyer
- Risk of loss passes to buyer when seller delivers goods to carrier
- If K is otherwise silent on shipment terms, shipment K is presumed if K requires shipment by 3rd party carrier
Delivery & Risk of Loss in UCC Ks - Shipment by Carrier (Destination Ks)
Seller obligated to ensure goods reach buyer
- Risk of loss passes to buyer only when buyer takes delivery
Delivery & Risk of Loss in UCC Ks - Non-Carrier Delivery (Merchant Seller)
Goods not shipped by common carrier
- ROL passes to buyer when he takes physical possession
Delivery & Risk of Loss in UCC Ks - Non-Carrier Delivery (Non-Merchant Seller)
Goods not shipped by common carrier
- ROL passes to buyer upon tender of delivery
Delivery & Risk of Loss in UCC Ks - Goods Destroyed before ROL Passes
K is avoided if no party at fault
Delivery & Risk of Loss in UCC Ks - FOB Location
Seller bears risk and expense of getting goods to the named location, at which point risk passes to buyer
- e.g. A in Akron sells goods to B in Boise; K states “FOB Boise”; A is responsible for getting goods to Boise, then risk passes to B
Delivery & Risk of Loss in UCC Ks - Breach & ROL
If buyer rejects defective goods or revokes acceptance, ROL does not pass to buyer until defects are cured or she accepts
Warranty - Definition
A warranty is a promise regarding a K
- UCC Ks have default implied warranties, which can be disclaimed
Express Warranty - Definition
Promise about quality or feature of a product
- E.g. manufacturer claims cell phone is water proof to 20 feet
- Breached if the product falls short of seller’s promise or description
Implied Warranty of Merchantability
Teller automatically warrants goods are fit for their ordinary purpose
Implied Warranty of Fitness for a Particular Purpose
Seller warrants that goods are fit for buyer’s purpose if:
1) Buyer has a particular purpose
2) Buyer relies on seller to select suitable goods; and
3) Seller has reason to know of buyer’s purpose and reliance on seller
Limiting Warranty Liability - Disclaimer
Limits liability for implied warranties
- “As is” or “with al faults” language is enforceable
- Disclaimers will not limit liability for express warranties
Limiting Warranty Liability - Remedy Limitation
Limits recovery upon breach of warranty
- generally valid for all warranties
