Exam 20: Title and Risk of Loss

Pipe Company orders six irrigation pumps from Quality Pumps Inc. The pumps are stored in Re-storage Warehouse. Under the terms of the order, Quality must give Pipe a warehouse receipt for the goods, which the buyer will then pick up. Title to the goods passes to Pipe when

Jill buys a kayak from a Lake Craft store, which agrees to keep it for her until she picks it up. Before Jill gets the kayak, an unforeseen tornado destroys the store and the goods. The loss is suffered by

Red Bev LLC contracts to buy two tons of strawberries from Sweet Fruits, Inc. The contract states that Sweet Fruits is required to ship the strawberries to Red Bev by Truck Transport Inc. The contract is

In a shipment contract, the seller is required to deliver the goods to a particular destination.

Rice that fills Harvest Co-op's silo is fungible if the rice is

Identification gives

If the seller's title is voidable, a good faith purchaser acquires no title, and the real owner can reclaim the goods.

In a sale of oranges from Citrus Grove Farms to Juice Factory Inc. to be delivered after the harvest, a fire destroys the fruit before it is picked. Under the UCC, the rights and liabilities of Citrus and Juice in this circumstance are generally determined by

Confection Corporation orders Double Chocolate Bars from Edible Distribution Company. Edible identifies the goods. Before they are shipped via Fast Shipping LLC, an insurable interest in the goods exists in

Goods that are not both existing and identified to the contract are called future goods.

Title can pass to the buyer from the seller before the goods are identified to the contract.

Generally, the party in breach of a sales contract bears the risk of loss.

Parties to sales or lease contracts often obtain insurance coverage to protect against damage, loss, or destruction of the goods.

In a shipment contract, risk of loss remains with the seller until the goods are delivered to the buyer at the buyer's place of business.

Equipment Corporation agrees to lease a woodchipper to Forest Management LLC. Before any interest in the woodchipper can pass from Equipment to Forest, it must be

Roofing Contractor LLC buys roofing tiles from Shingles Inc. The parties agree that the tiles will be shipped "F.O.B. Shingles" to Roofing via Tristate Shipping Corporation. The tiles are lost in transit. The loss is suffered by

In the following situations, two parties claim the same goods. Who is most likely to prevail in each circumstance? Explain. (a) Czeslaw steals Denise's Ultra HD TV set and sells it to Ezra, an innocent purchaser, for value. Denise learns that Ezra has the set and demands its return. (b) Gwendolyn takes her all-terrain vehicle (ATV) for repair to Hank's Sales & Repair, a merchant who fixes and sometimes sells used ATVs. By accident, one of Hank's employees sells Gwendolyn's ATV to John, an innocent purchaser-customer, who takes possession. Gwendolyn wants her ATV back from John.

Appliance Corporation sells Best-brand vacuum cleaners to Cash Discount Stores and other retailers. Appliance will have an insurable interest in the vacuums as long as

Beef Inc. raises calves to sell. Beef breeds its cows in April, and the cows calve in February of the following year. In January, Cold Cuts Inc. contracts with Beef to buy fifty calves. Identification takes place in

Runners Feet, a shoe store, orders one hundred pair of athletic shoes from Speedster Inc. Absent a contrary agreement between the parties, title will pass to Runners Feet when