Ch. 23: Sale Remedies Flashcards
Buyer’s default
The seller’s remedies are triggered by the buyer’s action in wrongfully rejecting a revoking acceptance of the goods, in failing to make a payment due on or before delivery, or in repudiating the contract.
Insolvency (equity)
Inability to pay debts in ordinary course of business or as they become due.
Insolvency (bankruptcy)
Total liabilities exceed total value of assets
Stop delivery
If the buyer is insolvent (one who is unable to pay his debts as they become due or one whose total liabilities exceed his total assets), the seller may stop any delivery; if the buyer repudiates or otherwise breaches, the seller may stop carload, truckload, plane load, or large shipments.
Resell of goods
The seller may resell the goods concerned or the undelivered balance of the goods and recover the difference between the contract price and the resale price, together with any incidental damages, minus expenses saved.
Market price differential
The seller may recover damages from the buyer measured by the difference between the unpaid contract price and the market price at the time and place of tender of the goods, plus incidental damages, minus expenses saved.
Lost profit
In the alternative, the seller may recover the lost profit, including reasonable overhead, plus incidental damages, minus expenses saved.
Recover the price
The seller may recover the price: (1) when the buyer has excepted the goods, (2) when the goods have been lost or damaged after the risk of loss has passed to the buyer, or (3) when the goods have been identified to the contract and there is no ready market available for the resale.
Seller’s incidental damages
Commercially reasonable charges, expenses, or commissions directly resulting from breach.
Cancellation
One party’s putting an end to a contract because of a breach by the other.
Reclaim the goods
An unpaid seller may reclaim goods for an insolvent buyer under certain circumstances.
Seller’s default
The buyer’s remedies arise when the seller fails to make delivery or repudiates the contract, with the buyer rightfully rejects or justifiably revokes acceptance of goods tendered or delivered.
Cover
The buyer may obtain cover by proceeding in good faith and without unreasonable delay to purchase substitute goods; the buyer may recover the difference between the cost of cover and the contract price, plus any incidental and consequential damages, minus expenses saved.
Recover damages for non-delivery or repudiation
The buyer may recover the difference between the market price at the time the buyer learned of the bridge and the contract price, plus any incidental and consequential damages, but minus expenses saved.
Recover identified goods on the seller’s insolvency
For which the buyer has paid all or part of the price.
Replevin
The buyer may recover goods identified to the contract if (1) the buyer is unable to obtain cover or (2) the goods have been shipped under reservation of a security interest in the seller.
Specified performance
Equitable remedy compelling the party in breach to perform the contract according to its terms.
Enforce the security interest
A buyer who is rightfully rejected or justifiably revoked acceptance of goods that remain in her possession has a security interest in these goods for any payments made on their price and for any expenses reasonably incurred.
Recover damages for breach in regard to accepted goods
The buyer may recover damages resulting in the ordinary course of events from the seller’s breach; in the case of breach of warranty, such recovery is the difference between the value the goods would have had if they had been as warranted and the value of the non-conforming goods that have been accepted.
Buyer’s incidental damages
Reimbursement for reasonable expenses incurred in handling rightfully rejected goods or in effecting cover.
Consequential damages
Include (1) any loss resulting from buyers requirements of which seller has reason to know at the time of contracting and (2) injury to person or property approximately resulting from any breach of warranty.
Liquidation or limitation of damages
The parties may specify the amount or measure of damages that may be recovered in the event of a breach if the amount is reasonable.
Modification or limitation of remedy by agreement
The contract between the parties may expressly provide for remedies in addition to those in the Code, or it may limit or change the measure of damages recoverable for breach.
