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What is a shipment contract?
A shipment contract is a contract that requires or authorizes the seller to send the goods to the buyer but does not require that he deliver them at any particular destination. Generally, in shipment contracts, risk of loss passes to the buyer at the point of shipment, which is also the point of 'delivery.
What is the difference between a shipment contract and a destination contract?
Destination Contract: Goods are the property of the seller until they are delivered to the buyer. Once they make it to their destination intact, they become the property of the buyer. Shipment Contract: Goods are the property of the seller until they are delivered to the shipping company.
What is a destination contract?
Under Article 2 of the Uniform Commercial Code, a destination contract is one way in which buyer and seller could contract to allocate risk of loss between buyer and seller when goods or lost or damaged before the buyer obtains them from the seller and neither buyer nor seller is to blame for the loss.
Is this a shipment contract or a destination contract Quizlet?
In a destination contract, the SELLER completes his delivery obligations when: The goods arrive where the BUYER is. If the City is the City where SELLER is located or where goods are, it is a SHIPMENT contract. If the City is any other City, it is a DESTINATION contract.
How does a no arrival no sale contract differ from an FOB destination contract?
There are terms including the following that indicates the agreement is a destination contract. FOB (Free on Board) clause indicates a destination contract. NO ARRIVAL, NO SALE clause denotes the seller is liable for the goods unless the goods are damaged due to the seller's negligence.
What is FOB shipment contract?
Contracts dealing with goods to be shipped often include an FOB clause, which stands for “free on board”. This means that the goods will be shipped to a specific place without cost. The FOB terms are an important part of the purchase contract.
What are the obligations of the seller under a shipment contract?
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).
What are the obligations of the seller under a destination contract?
Destination contracts specify the buyer's destination as the point where seller's obligation to deliver is complete. At that point, all risk of loss passes to the buyer. Alternatively, under a shipment contract, the seller's obligation is complete when he passes the goods to the common carrier for delivery.
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