Question

42.

With nonconforming goods, the risk of loss does not pass to the buyer until the defects are cured or the buyer accepts the goods in spite of the defects.

a. True
b. False

46.

Generally, all contracts are assumed to be shipment contracts if nothing to the contrary is stated in the contract.

a. True
b. False

Answer 1

42. a. true

If the goods are so nonconforming that the buyer has the right to reject them, the risk of loss does not pass to the buyer.

With nonconforming goods, the risk of loss does not pass to the buyer until either:
1. The defects are cured—that is, the goods are repaired, replaced, or discounted in price by the seller.
2. The buyer accepts the goods in spite of their defects (thus waiving the right to reject).

The general rule is that when a buyer or lessee breaches a contract, the risk of loss immediately shifts to the buyer or lessee.

46. a. true

Generally, all contracts are assumed to be shipment contracts if nothing to the contrary is stated in the contract.