170' MODULE 24 SALES

(4) Buyer in error pays all costs of processing and shipping to seller
(5) Note that nonconsumer buyer may not use 'these more favorable provisions of this Act
EXAMPLE: Buyer intends to purchase one copy of a DVD from ABC Company, The buyer, who is
purchasing this DVD for consumer use, mistakenly orders ten copies from ABC's Web site. The buyer is
protected byfollowing the steps given above,
3. Buyer may accept nonconforming goods
(1) Buyer must pay at contract price but may still recover damages (i.e., deduct damages from
price if s/he gives seller notice)
(2) Buyer may revoke acceptance in a reasonable time if
(a) Accepted expecting nonconformity to be cured
(b) Accepted because of difficulty of discovering defect
(c) Accepted because seller assured conformity
4. Buyer may recover damages measured by the difference between the contract price and the market
value of the goods at the time buyer learns of the breach, plus any incidental damages and conse-
quential damages
(1) Consequential damages are damages resulting from buyer's needs that the seller was aware of
at (he time of contracting
(2) Consequential damages cannot be recovered if buyer could reasonably have prevented these
(mitigation of damages)
5. Buyer has the right of cover
(1) Buyer can buy substitute goods from another seller-buyer will still have the right to damages
after engaging in "cover"
(a) Damages are difference between cost of cover and contract price, plus incidental and con-
sequential damages
(b) Failure to cover does not bar other remedies
6. Once goods to the contract have been identified, buyer obtains rights in those goods
(1) Identification occurs when goods under contract are
(a) Shipped
(b) Marked as part of the contract, or
(c) In some way designated as part of contract
(2) Buyer obtains
(a) Insurable interest in those goods, and
(b) Right to obtain goods, called replevin, upon offering contract price
1] Replevin is not allowed if buyer can cover
7. Buyer may obtain specific performance if goods are unique or in other proper circumstances even
if goods arenot identified to the contract
(1) Proper circumstances may exist when other remedies (such as monetary damages or remedy of
cover) are inadequate
EXAMPLE: S agrees to sell B all antique car of which only one-exists. IfS later refuses to go through with
the contract, B may require S to sell him the unique car under the remedy of specific performance.
8. Statute of limitations for sale of goods is four years
9. An action for breach must be commenced within this period .
10. Parties may agree to reduce to not less than one year but may not extend it
11. Statute of limitations begins ~nning when the contract is breached
12. Leases under UCC
13. Law governing leases has been slow to develop and has been "tacked on" for various other areas
of
law such as property law and secured transactions
14. Now Article 2A of the UCC applies to any transaction creating :it lease regardless of form
15. Article 2A is how law in majority of states