Commerical: Seminar 1- Rejection Of Co

Front 1

When does a buyer have the right to reject?

Back 1

a. Where he is permitted to do so by the expressterms of the contract.

b. Where a right to reject is given by termsimplied in fact or by usage of trade or a course of dealing between theparties.

c. Where the seller has committed a breach of anexpress or implied condition of the contract.

d. Where the seller has by words or conduct evincedan intention to repudiate the contract or has disabled himself from performingit in an essential respect or has broken the contract in such a way as tofrustrate its commercial purpose.

Front 2

When can/must a buyer reject the goods.

Back 2

Buyer can either reject the goods either by declining toreceive them or by giving notice of rejection before a tender of delivery orafter receipt of the goods and before acceptance.

The goods must be rejected within a reasonable time- Sale of goods act 1979, s 35(4)

What constitutes a 'reasonable time'- new legislation looks as though it will incorporate the Marks and Spencers 30 days rule!

Front 3

How must a buyer reject the goods?

Back 3

The right to reject must be exercised by an unequivocalnotice of rejection to the seller.The buyer doesn’t have to return the goods.

Front 4

Does it matter how the buyer communicates this rejection? What if he uses ambiguous language in his communication to the seller?

Back 4

A notice which leaves the seller in reasonable doubt as towhether the buyer is or is not rejecting is not sufficient- Graanhandel T Vink BV v European Grain andShipping Ltd [1989].

Front 5

When can it be said that a buyer loses his right to reject the goods?

Back 5

The buyer may lose his right to reject by conduct which isinconsistent with rejection before, at the time of or subsequent to his noticeto reject.He cannot reject if at the time of giving notice he hasalready accepted the goods or is deemed to have done so, or is on some otherground precluded from denying that he has adopted the transaction.

Front 6

What is the effect of improper rejection?

Back 6

Improper rejection constitutes a repudiation, which theseller is entitled to accept as discharging the contract (but not obliged to). If the seller elects to hold the buyer to the contract, therejection is ineffective.If the seller accepts the buyer’s repudiation, the propertyrevests in the seller who can then recover the goods and sue the buyer fornon-acceptance.

Front 7

What is the effect of lawful rejection?

Back 7

The rejection nullifies the delivery. The seller is treatedas if he has not tendered delivery at all.Unless otherwise agreed, where the buyer exercises a rightto reject, the property in the goods revests in the seller and the goods areagain at his risk.

Front 8

Does the seller have a right to cure the goods he has made?

Back 8

yes he does-
Borrowman Phillips& Co v Free & Hollis [1878]

Contract for maize. The plaintiffs supplied the defendantwith a quantity of maize but the tender was unlawful. When the plaintiffsupplied the defendant with another cargo of maize, the defendants refused onthe grous the plaintiffs could not substitute other goods for those firsttendered.

The C of A rejected the defendants argument that the firsttender irrevocably identified the contract goods, and held that plaintiffs wereat liberty to tender another cargo in conformity with the contract, and thishad been done. They were therefore entitled to damages for non-acceptance.

Front 9

In what case was Borrowman Phillips & Co v Free & Hollisconfirmed?

Back 9

The Kanchenjunga[1990]

Front 10

The Kanchenjunga[1990] confirmed which case?

Back 10

Borrowman Phillips & Co v Free & Hollis [1878]

Front 11

Can the seller put in a re-tender even if the 'deadline' has passed?

Back 11

A retender is not necessariliy too late merely because thecontract date for delivery has passed.

The buyer is entitled to reject late delivery only wheretime is of the essence or where a reasonable time has elapsed after thecontract delivery date.

Front 12

Where the rejection relates to part of the goods and theseller has no right to tender by instalmentslate?

Back 12

A buyer who accepts part of the goods is not precluded fromrejecting the rest where not conforming to the contract. But if, in a contract that does not provide fordelivery by instalments, the buyer exercises his right to accept part whilerejecting the rest, he cannot be compelled to accept a fresh tender as to thepart rejected. For he is not obliged to accept delivery by instalments

Front 13

When would a seller's failure to give a good tender constitute a repudiation of the contract?

Back 13

Is the seller entitled to an indefinite number of bites atthe cherry until he has successfully put in a successful tender? Clearly not,says Goode.

Even a single defective tender could constitute repudiationif it were so defective, or was made so near the expiry date (where time is ofthe essence) as to indicate that proper performance by the seller was eithernot intended or impossible. But in other circumstances, several attempts willconstitute a repudiation.

Front 14

Can the buyer recover the loss and expenses he hasincurred in connection with an abortive tender (e.g. an imperfect tender madewithin the contract period)?

Back 14

No authority on this point, but Goode reckons that therewould a seller owes an implied collateral duty not to make an invalid tender,and that the buyer would be entitled to compensation for any loss suffered andany expenses needlessly incurred in arrangements to collect goods which uponsubsequent tender he lawfully rejects.