NW Servers agrees to sell 50 servers to Online Technology. The servers, which On
ID: 390334 • Letter: N
Question
NW Servers agrees to sell 50 servers to Online Technology. The servers, which Online Technology expressly requires to have certain amounts of memory, to be shipped “F.O.B. Online Technology distribution center in Yakima, WA.” When the servers arrive, Online Technology rejects them and informs NW Servers, claiming that the servers do not conform to Online Technologies memory requirement. A few hours later, the servers are destroyed in a fire at Online Technology’s distribution center. Will NW Servers succeed in a suit against Online Technology for the cost of the goods? Why or why not. Please answer substantively explaining the law and applying the facts to the law. Cite to your outside resources
Explanation / Answer
NW Servers may not succeed in a suit against Online Technology for the cost of goods. This is because NW Servers (seller) shipped servers which did not meet the requirement of Online Technology (buyer). Hence, the goods were non-comforming. Since the seller has breached by delivering non comforming servers, so the risk of loss has to be beared by the breaching seller. The loss has to be borne by the seller until the defects are removed or until the buyer is satisfied with the goods and accepts them despite defects. In this case, the servers were destroyed while in the possession of the buyer. However, the goods were non-comforming. So, NW Servers will have to bear the risk of loss.
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