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Jacob Hartz Seed Co. v. Coleman 612 S.W.2d 91 1981

Jacob Hartz Seed Co. v. Coleman 612 S.W.2d 91 1981

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Published by Thalia Sanders

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Published by: Thalia Sanders on Aug 30, 2010
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Westlaw Delivery Summary Report for PATRON ACCESS,-
Date/Time of Request: Monday, August 30, 2010 12:23 EasternClient Identifier: PATRON ACCESSDatabase: AR-CSCitation Text: 612 S.W.2d 91Lines: 195Documents: 1Images: 0
11.1 Nonconforming Goods Contract Sales and Lease Contracts: Performance and Breach
The material accompanying this summary is subject to copyright. Usage is governed by contract with Thomson Reuters,West and their affiliates.
 
Supreme Court of Arkansas.JACOB HARTZ SEED COMPANY, INC., anArkansas Corporation, Appellant,v.E. R. COLEMAN, Appellee.
No. 80-180.
Jan. 26, 1981.Rehearing Denied March 23, 1981.Buyer who had bought certified soybeans broughtaction against seller seeking reimbursement for bal-ance of money it paid for beans, plus costs, assert-ing seed did not meet required germination test.Seller counterclaimed asserting he suffered dam-ages resulting from his resale of seeds below con-tract price. The Circuit Court, IndependenceCounty, Leroy Blankenship, J., found soybeanswere at all times in conformity with terms of con-tract, dismissed claim for reimbursement and awar-ded seller $6,551.60 on its counterclaim. Buyer ap-pealed and seller cross appealed. The SupremeCourt, Holt, J., held that buyer of soybeans rejectednonconforming beans within reasonable time afterdiscovery of nonconformity following second ger-mination test performed on beans at seller's requestand seasonably notified seller; thus, buyer was en-titled to reimbursement.Reversed and remanded.Dudley, J., filed dissenting opinion in whichAdkisson, C. J., and Purtle, J., joined.West Headnotes
[1]Sales 343 178(1)
343Sales343IVPerformance of Contract343IV(C)Delivery and Acceptance of Goods 343k178Acts Constituting Acceptance343k178(1)k. In General.Most Cited CasesDelivery does not in and of itself constitute accept-ance under a contract. Ark.Stats. §§ 85-2-601,85-2-602, 85-2-606.
[2]Sales 343 179(6)
343Sales343IVPerformance of Contract343IV(C)Delivery and Acceptance of Goods 343k179Effect of Acceptance343k179(6)k. Protest, Objection, No-tice, or Conditional Acceptance, and Effect There-of.Most Cited CasesBuyer of soybean seeds rejected nonconformingseeds within reasonable time after discovery of nonconformity following second germination testperformed on seeds at seller's request and season-ably notified seller; thus, buyer was entitled to re-imbursement. Ark.Stats. §§ 85-2-101 et seq.,85-2-601, 85-2-602, 85-2-606, 85-2-615.
**91 *757
Macom, Moorhead, Green & Henry byWilliam M. Moorhead, Stuttgart, for appellant.Thompson & Arnold by Blair Arnold, Batesville,for appellee.HOLT, Justice.Appellant, pursuant to a contract, bought certifiedsoybeans from the appellee, producer. By this ac-tion appellant seeks reimbursement from appelleefor the balance of money it paid appellee for thebeans, plus costs, asserting the seed did not meetthe required germination test. Appellee counter-claimed, asserting he suffered damages resultingfrom his resale of the seeds below the contractprice. The court, sitting as a jury, found the soy-beans were at all times in conformity with the termsof the contract and dismissed appellant's claim forreimbursement of.$9,915.16 and awarded appellee$6,551.60 on its counterclaim. Appellant contendson appeal that the lower court erred in not finding alack of acceptance under Chapter 2 of the Uniform612 S.W.2d 91 Page 1271 Ark. 756, 612 S.W.2d 91, 30 UCC Rep.Serv. 944
(Cite as: 271 Ark. 756, 612 S.W.2d 91)
© 2010 Thomson Reuters. No Claim to Orig. US Gov. Works.
 
Commercial Code, Ark.Stat.Ann. ss 85-2-101 etseq. (Add.1961), or in the alternative, in not findingthat the doctrine of impracticability, Ark.Stat.Ann.s 85-2-615 (Add.1961), applies. Appellee cross-appeals, contending the court erred in not awardinghim an additional amount of $1,379.70 as damagesfor expenses he incurred in picking up and resellingthe beans.Appellant Hartz purchased the certified soybeanseed through a broker from the appellee in Febru-ary, 1978, for delivery in March or April.Thereupon, Hartz resold the seed, before delivery,to a wholesale seed dealer in Georgia.
*758
Theseed was picked up by this wholesale dealer onApril 8 and May 5 at appellee's warehouse in Cord,Arkansas. On May 15, after testing the seed, theGeorgia Department of Agriculture reported thegermination level (67%) to be below that certified(80%) by appellee according to Arkansas tests. Itplaced a stop sale order on the seed and notified ap-pellee. Appellee requested another
**92
test byGeorgia. On May 31, the test report indicated a ger-mination level of 65%, or again too great a variancefrom that certified by appellee. Appellant notifiedappellee on June 1 it was cancelling the contract.On June 14 and 16 appellee picked up the beans inGeorgia and on June 20 repaid appellant $20,250 of the purchase price. It appears the planting seasonfor this type soybean ends between June 15 and Ju-ly 10. Appellee had the seeds retested by theArkansas State Plant Board, which reported on July5, 1978, a germination of 81%. On July 21 theUnited States Department of Agriculture SeedLaboratory in Montgomery, Alabama, reported theArkansas samples tested 88% germination. On Au-gust 2 that agency reported the germination level of the Georgia sample at 76% or 78% or sufficient forthe 80% label as certified by appellee. In a letterdated August 21, appellee requested appellant totake delivery of the soybeans by August 31, whichwas refused. The value of the beans, as seed beans,had steadily declined from the end of the plantingseason until they were of no value as such as of thetime of the letter. Appellee sold the beans as oilbeans.Appellant argues that under the U.C.C. the goodswere seasonably rejected. Appellee contends thiswas a fact question, and the trial judge's finding issupported by the evidence and should be up-held. We are of the view that the trial court erredfor the reason that the facts clearly preponderatethere was no acceptance under the U.C.C. Underthe Code, as adopted in Arkansas, the buyer mayreject goods which fail in any respect to conform tothe contract. Ark.Stat.Ann. s 85-2-601(Add.1971). Rejection must be within a reasonabletime after delivery or tender, and the buyer mustseasonably notify the seller. s85-2-602. Acceptance occurs when the buyer hashad a reasonable opportunity to inspect the goodsand signifies to the seller that they are conformingor that he will take them in spite of their noncon-formity. s 85-2-606. If the buyer fails to make aneffective rejection, under s 85-2-
*759
602, afterhaving had a reasonable opportunity to inspect thegoods, this also constitutes acceptance under s85-2-606. Under subsection (1)(c), if the buyer doesany act inconsistent with the seller's ownership, thismay constitute acceptance also.[1]It is clear that, under the Code, delivery doesnot in and of itself constitute acceptance. In Whiteand Summers, Uniform Commercial Code, p. 296(2d 1980), acceptance as provided in s 2-606, supra,is discussed:Acceptance is a term of art which must besharply distinguished from a variety of other actswhich the buyer might commit. Note first thatwhether the buyer has ‘accepted’ the goods is un-related to the question whether title has passedfrom seller to buyer. Secondly, acceptance is onlytangentially related to buyer's possession of thegoods, and in the usual case the buyer will havehad possession of the goods for some time beforehe has ‘accepted’ them.Furthermore, it is there pointed out that acts donewithout knowledge of defects, which the buyer612 S.W.2d 91 Page 2271 Ark. 756, 612 S.W.2d 91, 30 UCC Rep.Serv. 944
(Cite as: 271 Ark. 756, 612 S.W.2d 91)
© 2010 Thomson Reuters. No Claim to Orig. US Gov. Works.

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