Closing Sales Flashcards
What are the three ways to accept goods?
- Affirmative signification
- Failure to reject following a reasonable period to inspect
- Supplier Certification Programs
What must be proven to avoid acceptance of goods?
Intentional damage to goods
What is required for rejection of goods?
- Reasonable time after delivery
- Seasonable notice to the seller to remedy
- Specific grounds must be stated
What is the Perfect Tender Rule?
Goods that fail in any respect to conform with the contract create a right to reject
What are exceptions to the Perfect Tender Rule?
- Installment contracts can only reject installments
- Contractual limit on buyer’s remedies
- Seller’s right to cure
What must non-merchant buyers do after rejection?
Hold the goods with reasonable care for the seller to have time to remove them
What must merchant buyers do if they possess rejected goods?
- Follow any reasonable instruction of the seller as to resale, storage, or the like
- If the goods are perishable, specific actions may be required
What are the general requirements for revocation of acceptance?
- Notice to the seller
- Non-conformity must substantially impair the value to the buyer
Under what conditions can a seller cure a rejected tender?
- Time for performance has not yet expired
- Seller had reasonable grounds to believe the rejected tender would be acceptable
What is the significance of the case Sinico, Inc. regarding tender of goods?
Prompt tender of a conforming good that satisfies all contractual requirements serves as a remedy and must be made immediately available
What must the buyer reasonably believe for revocation to be valid?
The problem would be resolved based upon the seller’s assurances
In North American Lighting, what can allow acceptance to be revoked after months of use?
Reliance on assurances by the Seller that were unmet
What conditions must be met for revocation after discovering a problem?
- Must revoke within a reasonable time after discovery
- Before a substantial change has occurred in the goods not caused by their own defects
What is the general rule regarding the rejection of goods under a finance lease?
A buyer in a finance lease will be deemed to have accepted goods unless the buyer effectively rejects the goods and seasonably notifies the financer
Five General Requirement of Revocation
1) Notice
2) Substantial impairment of value
3) Reasonable belief that the problem would be resolved by seller’s assurances
4) Buyer was unaware (reasonably) of the problem
5) Revoked w/n a reasonable time, before substantial change to the goods
Rejection under an installment contract
(a) Can only be done by each delivery
(b) May reject any installment that substantially impairs the value and cannot be cured
(c) When one installment substantially imapirs the value of the whole–then the whole is breach; but there must be seasonable notice to cancel
