Also known as: U.C.C. § 2-709 · Uniform Commercial Code § 2-709 · § 2-709 · 2-709
Written by attorneys · grounded in primary & secondary sources — see below
An action available to a seller of goods that permits recovery of the contract price when the buyer fails to pay as due. The remedy applies to goods accepted by the buyer or to conforming goods lost or damaged after risk of loss has passed. It also reaches goods identified to the contract when the seller cannot resell them at a reasonable price after reasonable effort or when circumstances indicate that effort would be unavailing. The seller must hold identified goods for the buyer while the action proceeds.
Ulysses Maritime contracted to build a custom barge for Union Steel at a fixed price. Ulysses completed construction and identified the barge to the contract. Union Steel repudiated before tender. Ulysses held the barge and sued for the full price. Because the goods were identified and resale would have been commercially impractical, the court awarded the contract price plus incidental damages.
Uptown Apparel bought specialized manufacturing equipment from Cissell Mfg. Co. The buyer took delivery, used the equipment for several weeks, and paid the initial installment. After a staffing change the buyer attempted to return the machines and withhold the balance. Cissell refused the return and sued for the unpaid price. The court held that acceptance had occurred and awarded the remaining contract price.
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A seller may recover the price when the buyer has accepted the goods or when conforming goods are lost or damaged after risk of loss passes. Recovery is also available for goods identified to the contract if the seller cannot resell them at a reasonable price after reasonable effort or if circumstances indicate that effort would be unavailing.
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The seller must hold the goods for the buyer. The seller may resell before judgment and credit the net proceeds to the buyer if the resale occurs.
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Customization supports the claim that resale would be unavailing but does not automatically satisfy the test. The seller must still show inability after reasonable effort or circumstances indicating that effort would fail. Failure to attempt any resale can defeat recovery of the price.
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The seller may recover damages for non-acceptance under section 2-708 when the buyer has wrongfully rejected, revoked acceptance, failed to pay, or repudiated.
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