Would the result differ if Henry were a dealer in automobiles? Explain.
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Henry and Mary entered into a written contract whereby Henry agreed to sell and Mary agreed to buy a certain automobile for $8,500. Henry drove the car to Mary’s residence and properly parked it on the street in front of her house, where he tendered it to Mary and requested payment of the price. Mary refused to take the car or pay the price. Henry informed Mary that he would hold her to the contract, but before Henry had time to enter the car and drive it away, a fire truck, answering a fire alarm and traveling at a high speed, crashed into the car and demolished it. Henry brings an action against Mary to recover the price of the car. Who is entitled to judgment? Would the result differ if Henry were a dealer in automobiles? Explain. |
Explanation
The seller, under remedy to seller, holds the right to recover the price of goods in the following three situations:
If buyer accepts the goods
If the validated goods get lost or damaged after the transfer of risk of loss from seller to buyer
If the goods identified to the contract do not get any available market for resale of goods at reasonable price
In this case, Person M has not accepted the good but the risk of loss has been transferred to Person M on the grounds that Person H, the seller, has delivered the good to Person M, the buyer. This is because in case of non-trader of goods, the risk of loss transfers to the buyer at the time of delivery of goods. So, Person M may need to pay for the loss of Person H's automobile.
If Person H was a dealer, the settlement would have been in the favor of Person M as in case of dealers, the ownership is passed on to the buyer after receiving the goods. However, in this case, the goods were not received by the buyer, and hence, the loss would not be incurred by the buyer.
Verified Answer
In this case, Person H may be entitled to judgement as Person H is not a trader of automobile. This is because the ownership, in case of a non-trader, passes to the buyer at the time of the delivery of goods.
If Person H was a trader, the judgement would have been passed in the favor of Person M. This is because in case of traders of goods, the ownership passes to buyer after receiving the goods.
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