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FALL 2002
Sales
Law 7451

Computer ID	Day	Start Time	End Time	Room Number
84987	M	6:00	8:45	406 UL

Professor Budnitz
mbudnitz@gsu.edu
404/651-2135

BUYER'S RIGHT TO REJECT:
BUYER'S SUBSTANTIVE RIGHT

I. "Perfect tender" rule applies to single delivery contracts

A. § 2-601 provides that buyer can reject if the goods "fail in any respect to conform to the contract...." See § 2-106, Comment 2: "It is in general intended to continue the policy of requiring exact performance by the seller of his obligations as a condition to his right to require acceptance."
Rule is sound policy because it results in substantial uniformity and certainty. Once buyer establishes there was a failure to conform, buyer has met his burden. Buyer need not litigate over whether the breach was material or substantial, so judicial efficiency is furthered.

B. Apparent stringent requirement of rule is ameliorated by the following.

1. Not any conformity, only non-conformity with respect to the contract.
See § 2-106(2)—conform in accordance with obligations under the contract.

2. Agreement should be interpreted in light of CUC. § 2-601, Comment 2. Consider usage of trade which "frequently permits commercial leeways...." § 2-601, Comment 2.

3. Parties can otherwise agree.

4. Seller can has an opportunity to cure.

5. If seller does not cure and buyer forces goods back onto seller, seller can resell goods to someone else.

6. De minimis exception. Example: Buyer orders 10,001 bushels, seller delivers 10,000 bushels.

7. Exception for minor complaints and minor adjustments over a limited period of time, especially where goods are complicated. See e.g., Fargo case. Page 351.

II. Substantial impairment rule applies to installment contracts---§ 2-612: Buyer may reject any installment if non-conformity in that installment substantially impairs the value of that installment and cannot be cured. In rare situations, the nonconformity can substantially impair the value of the whole contract and the entire contract may be rejected. § 2-612(3) and Comment 6.