Chapter 16: UCC Remedies Flashcards
anticipatory repudiation
one party or the other indicating an intention to not perform with regard to performance not yet due
if the forth coming breach would result in substantial impairment in value of the contract… (anticipatory repudiation)
-do nothing and wait (to see if breach actually occurs)
OR
-sue the other co. immediately for breach of contract
*co. that is getting screwed also has right to stop their own performance of the contract
can a breaching party of an earlier anticipatory repudiation retract?
generally yes (breaching party can change their mind)
when can a breaching party not take back their anticipatory repudiation?
- the other party gave notice that the repudiation sent was final
- the other party changed position in reliance on repudiation (they’ve purchased the goods elsewhere)
when can the seller withhold delivery and demand cash?
- only when the buyer is insolvent
- this can be done even if credit was extended to the buyer in the og contract
- determining the buyer is insolvent (fact v. fiction) can be quite tricky though
when can the seller stop delivery of the goods?
- if the buyer is insolvent (w/ respect to any size shipment)
- as to other breaches by the buyer (failing to make prepayment, etc) (only available w/ respect to large shipments
improper stoppage by a seller is…
a breach of contract if delayed delivery results
if the delivery of goods has been stopped can the seller also sue the buyer?
yes! seller can still sue buyer for breach regardless of whether shipment could be stopped
when does seller have right to re-sell the goods?
- upon any breach by the buyer, but must be accomplished in good faith and in a commercially reasonable manner
- can be sold at public sale (auction) or private (negotiated) sale
what can the seller recover if they resell the goods?
the contract price less the resale price plus incidental damages
what does the seller have to do before reselling the goods?
- give notice to the go buyer
- general notice for negotiated sale
- specific notice (time and place) for auction sale
when can the buyer reject the goods?
- if the goods or tender of delivery fail to conform in any respect to the contract
- title transfers back to seller whether or not rejection was rightful
what clause might eliminate the buyer’s right to reject the goods because of defects?
“as is” clause or other effective disclaimer
who does the risk of loss go to when goods are rejected?
remains on seller until the breach is cured or the goods are accepted by the buyer notwithstanding the breach
how does a buyer have to reject goods?
- must occur w/in reasonable time
- buyer must give seasonable notice to seller
- buyer must thereafter hold the rejected goods with reasonable care