Fleet counterclaimed for the balance due under the installment contract less the proceeds from the sale. Who will prevail? Why?

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Fleet counterclaimed for the balance due under the installment contract less the proceeds from the sale. Who will prevail? Why?

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In April, F. W. Lang Company purchased an ice cream freezer and refrigeration compressor unit from Fleet for $2,160. Although the parties agreed to a written installment contract providing for an $850 down payment and eighteen installment payments, Lang made only one $200 payment upon receipt of the goods. One year later, Lang moved to a new location and took the equipment along without notifying Fleet. Two years after the sale, Lang disconnected the compressor from the freezer and used it to operate an air conditioner. Lang continued to use the compressor for that purpose until the sheriff seized the equipment and returned it to Fleet pursuant to a court order. Fleet then sold the equipment for $500 in what both parties conceded was a fair sale. Lang then brought an action charging that the equipment was defective and unusable for its intended purpose and sought to recover the down payment and expenses incurred in repairing the equipment. Fleet counterclaimed for the balance due under the installment contract less the proceeds from the sale. Who will prevail? Why?

Explanation & AnswerSolution by a verified expert

Explanation

As per the rejection of goods rule, the rejection of any nonconforming goods should be within aspecified time. In this case, Buyer L did not notify Seller F promptly about the rejection of the delivered goods and continuously used that equipment. The delay in rejection and the continuous use of the equipment represent the acceptability of that equipment by Buyer L. So, the case is going to be won by Seller F.

Verified Answer

The judgement is going to be in favor of Seller F since, in this case, Buyer L did not reject the delivery of the equipment within aspecified time and used the equipment instead. The use of the equipment reflects the acceptability of the goods by the buyer.

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