Question

The UCC Perfect Tender Rule sets out certain options that the buyer of goods has if the delivery fails to conform to the contract. What are these options? What conditions must the buyer meet?

Answer 1

Under the Uniform Commercial Code's perfect tender rule, the buyer has the following options:

1. Inspection: The buyer can inspect the goods and check if they conform to the acceptable standards of quality. If they do not match the expectations of the buyer, the buyer can reject it and refuse to pay.

The right to inspect and reject goods comes with certain exceptions:

a. The buyer has previously agreed to pay without exception. This does not mean that the buyer cannot reject the goods later.

b. The delivery mode is cash on delivery.

c. Payment is to be made against documents title.

If the buyer fails to inspect or discover a defect, he cannot revoke it later.

2. Acceptance: The buyer accepts the goods but if the delivery mode is not proper this has to be rechecked. The buyer may accept the goods by words, silence or action. Once the buyer accepts the goods, the buyer is obligated to pay for the goods and looses the right to reject the goods.

3. Payment: The parties may specify when and how the payment is to be made.

If the buyer has rejected goods, he has to hold it with reasonable care.The costs associated with this rejection that is storage, reshipping are not to be borne by buyer.

4. Revocation: A revocation of acceptance means that though the buyer has accepted the goods, he can return the goods and get his money back. There are two circumstances in which the buyer can revoke an acceptance if the nonconformity:

1. if the buyer reasonably thought the nonconformity would be corrected and it is not within a stipulated time; or
2. if the acceptance was due to a defect that could not have been discovered before acceptance.

The duty of the buyer is to inspect, accept, and pay. The buyer looses the right to complain if inspection does not give the specific result.