BUL Ch. 15

Sellers duties and rights

Tender of delivery: - default rule is to ship goods or make them available in a reasonable manner - contract can override with specific terms Perfect tender rule: - to deliver conforming goods exactly as promised under the contract

Buyers duties and rights

Default duty is to accept conforming goods and pay for them. - contract may include additional terms Once the buyer has accepted the goods, the buyer must pay for them in accordance with the contract. Unless the parties agree otherwise, the buyer has a reasonable time period to inspect the goods to be sure they conform to the contract. In an installment contract, each lot must be accepted and paid for separately. This means that the buyer can accept one installment without giving up the right to reject any additional installments that are non-conforming.

Good faith under the UCC

Honesty in fact in the conduct or transaction concerned.

If non-conforming goods are delivered

If a seller delivers nonconforming guidance, the buyer has three options: (1) reject the entire shipment of goods within a reasonable time. (2) accept the shipment of goods as is. (3) accept any number of commercial units and reject the rest of the goods within a reasonable time. If the seller has delivered goods and the buyer rejects them as non-conforming, the seller has the right to repair or replace the rejected goods so long as the time period for performance has not expired. Once the time contemplated for performance has expired, the sellers right to cure also expires. Commercial Impracticability is an arrow doctrine that excuses the seller's performance when the delivery or non-delivery of goods have been made impracticable by the occurrence of an unanticipated event, and the unanticipated event directly affects the basic assumption of the contract.

Usage of trade (UCC gap filler)

Method of performance that is specific to a particular trade or industry used to define expectations of the parties engaged in specific transactions that are common in that industry

Course of performance (UCC gap filler)

Method to show what the parties intended through their own actions in performing the specific contract in question

Course of dealing (UCC gap filler)

Refers to how the parties acted in past contracts instead of the specific contract in question

UCC order of gap fillers

The UCC will always start out by first looking at the expressed term in the contract - what the parties expressed and agreed to already. Once expressed terms have been looked at and have not led to a decision then the UCC will look at : 1. Course of performance 2. Course of dealing 3. Trade usage ^ in this order, until a decision can be made. (Ex: If the UCC looks at the course of dealing and is able to make a decision - then trade usage will never be looked at and so on.)

commercial reasonableness

The term that establishes certain duties of merchants under the UCC. Ex: damaged goods are delivered to a buyer - the buyer (under the UCC) should let the seller know right away. And the seller (under the UCC) should cure the defect.

Breach of good faith

Will lead to additional damages on top of compensatory damages. Based on tort law (wrongful or unethical behavior)