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In a shipment contract, the seller has four duties: (1) to deliver the goods to a carrier; (2) to deliver the goods with a reasonable contract for their transportation; (3) to deliver them with proper documentation for the buyer; and (4) to promptly notify the buyer of the shipment (UCC, Section 2-504).

Void Title: If a buyer unknowingly purchases goods from a seller who is not the owner of the goods, the buyer's title to the goods is void, as was the seller's title before the sale.

Generally, the seller's primary obligations are to transfer ownership of the goods and deliver the goods. A seller may agree with the buyer to perform other obligations. For instance, a seller may agree to package or label the goods in a certain way or service the goods for a specific period of time.

Under a shipment contract, the seller is required only to deliver the goods into the hands of a carrier, and title passes to the buyer at the time and place of shipment.When a title document is required, title passes to the buyer when and where the document is delivered.

1. Suit for Damages for Non-Delivery- When the seller wrongfully neglects or refuses to deliver the goods to the buyer, the buyer may sue the seller for damages for non-delivery. This is in addition to the buyer's right to recover the price, if already paid, in case of non-delivery.

The Entrustment Rule : Entrusting goods to a merchant who deals in goods of that kind gives the merchant the power to transfer all rights to a good faith purchaser in the ordinary course of business.

Why is it important to determine when title passes? A contact for sale with the right of return gives the buyer both title to the goods and the opportunity to return the goods to the seller at a later time.The buyer also bears any risk of loss holding the title.

Under the UCC, a seller's primary obligation is "tender of delivery." In other words, delivering the goods to the buyer.to put and hold the goods at the buyer's disposition; and. to give the buyer whatever notice is reasonably necessary for the buyer to take delivery.

Expenses of a contract of sale; Expenses of payment; Any expense arising after delivery; Expenses of transport where the thing sold has to be sent to another place than the place of delivery and if the delivery is not to be carriage free;

Notice to Buyer by Seller of Shipment of Goods

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FAQ

What are the obligations of the seller under a shipment contract?

What is a void title?

What are the obligations of the seller?

What is required of the seller under a shipment contract?

What are the rights of buyer against seller?

What is the entrustment rule?

Why is it important to determine when title passes from the seller to the purchaser?

What are a seller's and a buyer's general obligations under a contract within the UCC?

What are the respective obligations of seller and buyer during a contract of sale?

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