Question

Bennett, an operator of a small chain of grocery stores in Chester County, Pennsylvania, contracts to purchase from Snyder, the owner of a cannery in Iowa, one hundred cases of Knee High Corn to be shipped FOB Ames, IA by Rispoli Truck Lines. Snyder delivers one hundred cases of Green Valley Corn to Rispoli Truck Lines for transport to Bennett. While in transit, the cargo is stolen. Snyder demands payment for the corn, but Bennett refuses to pay. Who has responsibility for the stolen corn? Is Bennett liable to pay Snyder?

Answer 1

Answer

As per the terms of FOB contract, the seller has the property ownership and risk only till the point the goods are put in the carriage. After that the safety of the goods in transit is the responsibility of the buyer.

In this case, Bennet contracts to purchase Knee High Corn from Synder. However, Synder transports Green Valley corn.

Although the corn which is stolen is not the responsibility of Synder, but in this case he did not ship the correct good as per the contract i.e., the contract was for one hundred case of Knee High Corn but he shipped Green valley corn.

So, in this case the responsibility of stolen corn is on Bennet but Bennet is not liable to pay to Synder because Synder did not ship the required goods to Bennet.

Thus, Bennet is not liable to pay to Synder.