Chap 22 Performance Flashcards
performance is
the carrying out of a contracts obligations according to its terms
the basic obligation of a seller
in a contract for the sale of goods is to transfer and deliver the goods in a way that conforms to the terms of the contract
tender must be at a reasonable time
tender (offer)
of performance by one party obligates the other party to perform
tender is an
offer by one party, who is ready, willing and able to perform his obligation to the other party, according to the terms of the contract
specific obligation of the parties
are determine by their contractual agreement
payment or tender of payment
unless otherwise agreed, is a condition to the sellers duty to tender and complete delivery
unless otherwise agreed, payment is due at the time and place the buyer is to receive the goods, even those the place of shipment is the place of delivery
ender of conforming goods
by the seller entitles him to acceptance of them by the buyer and to payment of the contractually agreed-upon price
tender of delivery
occurs when the seller obtains and holds conforming goods, makes them available to the buyer and gives the buyer reasonable notification and opportunity to take delivery
place of tender is
governed by the contract
if the contract does not specify the place of delivery, then the place of delivery is 1 the sellers place of business if he has one, 2 if the seller has no place of delivery, then the sellers residence, 3 if the goods are at a location other than the sellers place of business or resident the parties know that location then that location is the place for delivery
a buyer is required to
accept conforming goods and to pay for them according to the contract and is not required to accept a tender or delivery or nonconforming goods
if a tender in any manner is nonconforming
they buyer may
1 accept the whole
2 reject the whole,
3 or accept any commercial unit or units and reject the rest
PERFECT TENDER RULE
exceptions to perfect tender rule
agreement of the parties
cure (time left on the clock)
accommodation shipment
installment contract
inspection
usually, unless the terms of the contract provide for payment prior to inspection such as COD or payment against documents of title, the buyer has right to inspect the goods before payment or acceptance, in order to determine whether the goods conform to the contract
the inspection must be
within a reasonable time
buyer must give
prompt notice of any nonconformity
the expense of the inspection
is the buyers, unless the goods are nonconforming in which case the buyer can recover the costs of the inspection from the seller
COD
collect on delivery
instruction to carrie to get money before delivery
rejection
rejection is a manifestation by the buyer of her unwillingness to become owner of the goods
rejection of nonconforming goods or tender
is rightful under the perfect tender rule
rejection must be made
within a reasonable time that the goods have been tendered or delivered and is not effective unless the buyer seasonably notifies the seller of the rejection
if the defect which causes a buyer to reject goods is curable
the buyer must either tell the seller of the defect or she may not use the defect as an excuse for rejecting the goods
acceptance
acceptance of goods means a willingness by the buyer to become the owner of the goods tendered or delivered to him by the seller
acceptnace occurs
when the buyer, after a reasonable opportunity to inspect the goods 1 signifies to the seller that the goods conform to the contract, 2 signifies to the seller that he will take the goods or retain them in spite of their nonconformity to the contract or 3 fails to make an effective rejection of the goods
revocation of acceptance
a buyer may revoke acceptance of defective goods if the nonconformity substantially impairs the value of the goods to him and
1 the buyer accepted the goods on the reasonable expectation that the defect would be cured and it was not seasonably cured
2 the defect was difficult to discover and was therefore not discovered during inspection
or 3 because of the sellers assurances that the goods were conforming
revocation gives buyer
the same rights and duties as if he had rejected the goods and is effective when the notification is given to the seller
obligation of payment
unless otherwise agreed, payment is due at the time and place the buyer is to receive the goods, even if the place of shipment is the place of delivery
this rule generally makes an allowance for the buyer the right to inspect the goods before paying for them
seasonably cured
within time allotted in contract or reasonable time if not time is stated
sometimes the performance obligations of one or both parties
may be excused, such as if one party defaults or if the goods which are the subject of the contract are somehow destroyed
the code contains three sections that address the situations which may excuse performance
casualty to identified goods
if goods are destroyed before an offer is accepted, the offer is terminated
after the offer is accepted, the rules for passage of risk or loss usually apply
only exception is if the contract is for already identified goods, and these goods are totally lost or damaged, without fault of either party and before the risk of loss passes to the buyer, the contract is avoided and each party is excused from his/her performance obligation under the contract
in the case of a partial destruction or deterioration of the goods
the buyer has the option to avoid the contract or to accept the goods with due allowance from the contract price
this allowance or deduction should be sufficient to account for the deterioration or deficiency in quantity
non happening of presupposed condition
although increased costs may not be relied upon to avoid a contract obligation, the non happening of a condition which was understood and assumed by both parties when the contract was formed will excuse the sellers performance
this is similar to the common law doctrine of impossibility of performance, but governed under the more liberal code standard of commercial impracticability
the code will excuse performance that, through not impossible
is commercial impracticable (more than inconvenient, performance too difficult to require in fairness; or must involve more than mere hardship or increased cost of performance)
the impracticability must be a result of an unforeseen event not within the contemplation of the parties at the time of contracting
substituted performance
if neither party is at fault, but the agreed-upon manner of delivering the goods becomes commercially impracticable, a substituted manner of performance, if commercially reasonable, must be tendered and accepted
right to adequate assurance of performance
if reasonable doubts arise regarding either party performance, the other party may demand written assurance of performance and until such assurance is received may suspend his own performance
the reasonableness of such demand for assurance of performance
is measured by commercial standards
where one partys cooperation is necessary to the agreed performance but is not timely forthcoming, the other party is excused for any resulting delay in her own performance
the non breaching party may either proceed to perform in any reasonable manner or, if the time for her performance has occurred, she may treat the failure to cooperate as a breach
in either event, the non breaching party has all other remedies provided by the code
anticipatory repudiation
if, before the time to perform occurs, one party takes an action that makes performance impossible, this action may be considered an anticipatory repudiation
if the repudiation substantially impairs the value of the contract, the aggrieved party may 1 await performance for a commercially reasonable time or 2 resort to any remedy for breach
in either case, she may suspend her own performance
the repudiating party may
retract her anticipatory repudiation unless the aggrieved (wronged) party has 1 cancelled the contract or 2 materially changed her position or 3 otherwise indicated that he considers the repudiation final
