Quiz 14: Performance and Breach of Sales and Lease Contracts

Business

img , the buyer has the right to reject the shipment. The perfect tender rule sates that the seller was obligated to eighty cases of peaches within stipulated time according to the terms of the contract. Any failure to conform to the contract may result in complete or partial rejection of the shipment. Since the seller did not specify the reason for delivering too little too late to take, the buyer has all the rights to reject the shipment. Moreover, the seller cannot take the advantage of partial performance exception.

Every contract relies upon the obligations of good faith and commercial reasonableness. The obligations of the parties- buyer and seller-under a contract for the sale or lease of goods are as below. Obligations of the Seller or Lessor The basic obligation of the seller is to transfer and deliver conforming goods to the buyer. He must give any notice that is reasonably necessary to enable the buyer or lessee to accept the delivery. a) Tender of Delivery: The goods must be delivered at a reasonable hour, in a reasonable manner. Further, the goods must be kept available for a reasonable time. b) Place of Delivery: The contract or the circumstances may indicate the place of delivery, or parties may agree on a particular destination. c) Perfect Tender Rule : The perfect tender rule sates that the seller was obligated to deliver the goods within stipulated time according to the terms of the contract. Any failure to conform to the contract may result in complete or partial rejection of the shipment. Obligations of the Buyer or Lessee The basic obligation of the buyer is to accept the conforming goods, and make the payment for the same and deliver conforming goods to the buyer. He must give any notice that is reasonably necessary to enable the buyer or lessee to accept the delivery. a) Payment: The buyer is required to pay for the conforming goods by any means as agreed upon by the parties. b) Right of Inspection: Before accepting the delivery, the buyer has the right to inspect if the goods are what contracted for. The buyer can reject the delivery if goods are not the same as stated in the contract. c) Acceptance: Given the reasonable opportunity to inspect, if the buyer fails to reject the goods within reasonable time, the delivery is assumed to be accepted.

A contract is a promise made by a person (promisor), to do or not do a definite act, to another (promisee). The contract of sales and lease is a contract between buyer and seller for the trading of the goods. Both seller and buyer have obligations in this contract. The obligation of a seller: Seller needs to ensure the delivery of the said goods to the buyer. The delivery need to be at rational time and rational manner, the seller cannot deliver goods at 4 in the morning. If the said goods are to be delivered at specific time, then the time can be acceptable. The goods also need to be in good condition. The obligation of a buyer: The main responsibility of the buyer is to accept the goods and pay for the goods as decided in the sales contract. Payment can be made in card and cash, but if a specific mode is mentioned then payment is done accordingly.

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