Chapter 72 — Sales
2011 EDITION
SALES
COMMERCIAL TRANSACTIONS
GENERAL PROVISIONS
72.1010 Short
title
72.1020 Scope;
certain security and other transactions excluded from chapter
72.1030 Definitions
and index of definitions
72.1040 Definitions:
“merchant”; “financing agency”; “between merchants”
72.1050 Definitions:
“goods”; “future” goods; “lot”; “commercial unit”
72.1060 Definitions:
“contract”; “agreement”; “contract for sale”; “sale”; “present sale”; “conforming”
to contract; “termination”; “cancellation”
72.1070 Goods
to be severed from realty; recording
FORM, FORMATION AND READJUSTMENT OF
CONTRACT
72.2010 Formal
requirements: statute of frauds
72.2020 Final
written expression: parol or extrinsic evidence
72.2030 Seals
inoperative
72.2040 Formation
in general
72.2050 Firm
offers
72.2060 Offer
and acceptance in formation of contract
72.2070 Additional
terms in acceptance or confirmation
72.2090 Modification,
rescission and waiver
72.2100 Delegation
of performance; assignment of rights
GENERAL OBLIGATION AND CONSTRUCTION OF
CONTRACT
72.3010 General
obligations of parties
72.3020 Unconscionable
contract or clause
72.3030 Allocation
or division of risks
72.3040 Price
payable in money, goods, realty or otherwise
72.3050 Open
price term
72.3060 Output,
requirements and exclusive dealings
72.3070 Delivery
in single lot or several lots
72.3080 Absence
of specified place for delivery
72.3090 Absence
of specific time provisions; notice of termination
72.3100 Open
time for payment or running of credit; authority to ship under reservation
72.3110 Options
and cooperation respecting performance
72.3120 Warranty
of title and against infringement; buyer’s obligation against infringement
72.3130 Express
warranties by affirmation, promise, description, sample
72.3140 Implied
warranty: merchantability; usage of trade
72.3150 Implied
warranty: fitness for particular purpose
72.3160 Exclusion
or modification of warranties; livestock warranty
72.3170 Cumulation and conflict of warranties express or implied
72.3180 Third
party beneficiaries of warranties express or implied
72.3190 F.O.B.
and F.A.S. terms
72.3200 C.I.F.
and C. and F. terms
72.3210 C.I.F.
or C. and F.: “net landed weights”; “payment on arrival”; warranty of condition
on arrival
72.3220 Delivery
“ex-ship”
72.3230 Form
of bill of lading required in overseas shipment; “overseas”
72.3240 “No
arrival, no sale” term
72.3250 “Letter
of credit” term; “confirmed credit”
72.3260 Sale
on approval and sale or return; rights of creditors
72.3270 Special
incidents of sale on approval and sale or return
72.3280 Sale
by auction
TITLE, CREDITORS AND GOOD FAITH
PURCHASERS
72.4005 Definitions
for ORS 72.4010 and 72.4030
72.4010 Passing
of title; reservation for security; limited application of ORS 72.4010
72.4020 Rights
of seller’s creditors against sold goods
72.4030 Power
to transfer; good faith purchase of goods; “entrusting”
PERFORMANCE
72.5010 Insurable
interest in goods; manner of identification of goods
72.5020 Buyer’s
right to goods on seller’s repudiation, failure to deliver or insolvency
72.5030 Manner
of seller’s tender of delivery
72.5040 Shipment
by seller
72.5050 Seller’s
shipment under reservation
72.5060 Rights
of financing agency
72.5070 Effect
of seller’s tender; delivery on condition
72.5080 Cure
by seller of improper tender or delivery; replacement
72.5090 Risk
of loss in the absence of breach
72.5100 Effect
of breach on risk of loss
72.5110 Tender
of payment by buyer; payment by check
72.5120 Payment
by buyer before inspection
72.5130 Buyer’s
right to inspection of goods
72.5140 When
documents deliverable on acceptance; when on payment
72.5150 Preserving
evidence of goods in dispute
BREACH, REPUDIATION AND EXCUSE
72.6010 Buyer’s
rights on improper delivery
72.6020 Manner
and effect of rightful rejection
72.6030 Merchant
buyer’s duties as to rightfully rejected goods
72.6040 Buyer’s
options as to salvage of rightfully rejected goods
72.6050 Waiver
of buyer’s objections by failure to particularize
72.6060 What
constitutes acceptance of goods
72.6070 Effect
of acceptance; notice of breach; burden of establishing breach after
acceptance; notice of claim or litigation to person answerable over
72.6080 Revocation
of acceptance in whole or in part
72.6090 Right
to adequate assurance of performance
72.6100 Anticipatory
repudiation
72.6110 Retraction
of anticipatory repudiation
72.6120 “Installment
contract”; breach
72.6130 Casualty
to identified goods
72.6140 Substituted
performance
72.6150 Excuse
by failure of presupposed conditions
72.6160 Procedure
on notice claiming excuse
REMEDIES
72.7010 Remedies
for breach of collateral contracts not impaired
72.7020 Seller’s
remedies on discovery of buyer’s insolvency
72.7030 Seller’s
remedies in general
72.7040 Seller’s
right to identify goods to the contract notwithstanding breach or to salvage
unfinished goods
72.7050 Seller’s
stoppage of delivery in transit or otherwise
72.7060 Seller’s
resale including contract for resale
72.7070 “Person
in the position of a seller”
72.7080 Seller’s
damages for nonacceptance or repudiation
72.7090 Action
for the price
72.7100 Seller’s
incidental damages
72.7110 Buyer’s
remedies in general; buyer’s security interest in rejected goods
72.7120 “Cover”;
buyer’s procurement of substitute goods
72.7130 Buyer’s
damages for nondelivery or repudiation
72.7140 Buyer’s
damages for breach in regard to accepted goods
72.7150 Buyer’s
incidental and consequential damages
72.7160 Buyer’s
right to specific performance or replevin
72.7170 Deduction
of damages from the price
72.7180 Liquidation
or limitation of damages; deposits
72.7190 Contractual
modification or limitation of remedy
72.7200 Effect
of “cancellation” or “rescission” on claims for antecedent breach
72.7210 Remedies
for fraud
72.7220 Who
can sue third parties for injury to goods
72.7230 Proof
of market price: time and place
72.7240 Admissibility
of market quotations
72.7250 Statute
of limitations in contracts for sale
SALE OF CONSUMER GOODS
72.8010 Definitions
for ORS 72.8010 to 72.8200
72.8020 Manufacturer’s
implied warranty of merchantability
72.8030 Manufacturer’s
implied warranty of fitness
72.8040 Retailer’s
or distributor’s implied warranty of fitness
72.8050 Disclaimer
of implied warranty of merchantability or implied warranty of fitness; manner
and effect
72.8060 Express
warranty
72.8070 Right
to make express warranty; effect of express warranty upon disclaimer; duration
of implied warranty of merchantability or implied warranty of fitness
72.8090 Form
of express warranty; designation of service and repair facilities
72.8100 Manufacturer’s
service and repair; facilities within state; nonconforming good; inability to
service; buyer’s delivery or notice of nonconforming good
72.8110 Retailer’s
service and repair of nonconforming good in absence of manufacturer’s service
and repair facilities within state; buyer’s delivery or notice of nonconforming
good
72.8120 Time
for commencement of service and repair; effect of delay; tender of conforming
goods
72.8130 Liability
to retailer of manufacturer not maintaining service and repair facility within
state
72.8140 Unauthorized
or unreasonable use after sale
72.8150 Service
contract in addition to or in lieu of express warranty
72.8160 Express
warranty in addition to implied warranties
72.8170 Authority
of manufacturer who makes express warranty to suggest methods of effectuating
service and repair
72.8180 Buyer’s
waiver of ORS 72.8010 to 72.8200
72.8190 Status
of remedies under ORS 72.8010 to 72.8200; effect of unconstitutionality
72.8200 Operative
dates
72.010, 72.020, 72.030, 72.040, 72.050,
72.060, 72.070, 72.080, 72.090, 72.100, 72.110, 72.120, 72.130, 72.140, 72.150,
72.160, 72.170, 72.180 [Repealed by 1961 c.726 §427]
GENERAL
PROVISIONS
72.1010 Short title.
This chapter may be cited as Uniform Commercial Code–Sales. [1961 c.726 §72.1010]
72.1020 Scope; certain security and other
transactions excluded from chapter. Unless the
context otherwise requires, this chapter applies to transactions in goods; they
do not apply to any transaction which although in the form of an unconditional
contract to sell or present sale is intended to operate only as a security
transaction nor does this chapter impair or repeal any statute regulating sales
to consumers, farmers or other specified classes of buyers. [1961 c.726 §72.1020]
72.1030 Definitions and index of
definitions. (1) In this chapter unless the context
otherwise requires:
(a)
“Buyer” means a person who buys or contracts to buy goods.
(b)
“Livestock” means equines, cattle, sheep, goats, llamas, alpacas and swine.
(c)
“Receipt” of goods means taking physical possession of them.
(d)
“Seller” means a person who sells or contracts to sell goods.
(2)
Other definitions applying to this chapter, and the sections in which they
appear are:
(a)
“Acceptance,” as defined in ORS 72.6060.
(b)
“Banker’s credit,” as defined in ORS 72.3250.
(c)
“Between merchants,” as defined in ORS 72.1040.
(d)
“Cancellation,” as defined in ORS 72.1060 (4).
(e)
“Commercial unit,” as defined in ORS 72.1050.
(f)
“Confirmed credit,” as defined in ORS 72.3250.
(g)
“Conforming to contract,” as defined in ORS 72.1060.
(h)
“Contract for sale,” as defined in ORS 72.1060.
(i) “Cover,” as defined in ORS 72.7120.
(j)
“Entrusting,” as defined in ORS 72.4030.
(k)
“Financing agency,” as defined in ORS 72.1040.
(L)
“Future goods,” as defined in ORS 72.1050.
(m)
“Goods,” as defined in ORS 72.1050.
(n)
“Identification,” as defined in ORS 72.5010.
(o)
“Installment contract,” as defined in ORS 72.6120.
(p)
“Letter of credit,” as defined in ORS 72.3250.
(q)
“Lot,” as defined in ORS 72.1050.
(r)
“Merchant,” as defined in ORS 72.1040.
(s)
“Overseas,” as defined in ORS 72.3230.
(t)
“Person in position of seller,” as defined in ORS 72.7070.
(u)
“Present sale,” as defined in ORS 72.1060.
(v)
“Sale,” as defined in ORS 72.1060.
(w)
“Sale on approval,” as defined in ORS 72.3260.
(x)
“Sale or return,” as defined in ORS 72.3260.
(y)
“Termination,” as defined in ORS 72.1060.
(3)
“Control” as provided in ORS 77.1060 and the following definitions in other
series of sections apply to this chapter:
(a)
“Check,” as defined in ORS 73.0104.
(b)
“Consignee,” as defined in ORS 77.1020.
(c)
“Consignor,” as defined in ORS 77.1020.
(d)
“Consumer goods,” as defined in ORS 79.0102.
(e)
“Dishonor,” as defined in ORS 73.0502.
(f)
“Draft,” as defined in ORS 73.0104.
(4)
In addition, ORS chapter 71 contains general definitions and principles of
construction and interpretation applicable throughout this chapter. [1961 c.726
§72.1030; 1979 c.636 §1; 1993 c.545 §116; 1995 c.320 §1; 2001 c.445 §132; 2009
c.181 §24]
72.1040 Definitions: “merchant”; “financing
agency”; “between merchants.” (1) “Merchant”
means a person who deals in goods of the kind or otherwise by occupation
purports to have knowledge or skill peculiar to the practices or goods involved
in the transaction or to whom such knowledge or skill may be attributed by
employment of an agent or broker or other intermediary who by occupation
purports to have such knowledge or skill.
(2)
“Financing agency” means a bank, finance company or other person who in the
ordinary course of business makes advances against goods or documents of title
or who by arrangement with either the seller or the buyer intervenes in
ordinary course to make or collect payment due or claimed under the contract
for sale, as by purchasing or paying the seller’s draft or making advances
against it or by merely taking it for collection whether or not documents of title
accompany or are associated with the draft. “Financing agency” includes also a
bank or other person who similarly intervenes between persons who are in the
position of seller and buyer in respect to the goods.
(3)
“Between merchants” means in any transaction with respect to which both parties
are chargeable with the knowledge or skill of merchants. [1961 c.726 §72.1040;
1987 c.158 §15; 2009 c.181 §25]
72.1050 Definitions: “goods”; “future”
goods; “lot”; “commercial unit.” (1) “Goods”
means all things (including specially manufactured goods) which are movable at
the time of identification to the contract for sale other than the money in
which the price is to be paid, investment securities and things in action. “Goods”
also includes the unborn young of animals and growing crops and other
identified things attached to realty as described in ORS 72.1070 on goods to be
severed from realty.
(2)
Goods must be both existing and identified before any interest in them can
pass. Goods which are not both existing and identified are “future” goods. A
purported present sale of future goods or of any interest therein operates as a
contract to sell.
(3)
There may be a sale of a part interest in existing identified goods.
(4)
An undivided share in an identified bulk of fungible goods is sufficiently
identified to be sold although the quantity of the bulk is not determined. Any
agreed proportion of such a bulk or any quantity thereof agreed upon by number,
weight or other measure may to the extent of the seller’s interest in the bulk
be sold to the buyer who then becomes an owner in common.
(5)
“Lot” means a parcel or a single article which is the subject matter of a
separate sale or delivery, whether or not it is sufficient to perform the
contract.
(6)
“Commercial unit” means such a unit of goods as by commercial usage is a single
whole for purposes of sale and division of which materially impairs its
character or value on the market or in use. A commercial unit may be a single
article (as a machine) or a set of articles (as a suite of furniture or an
assortment of sizes) or a quantity (as a bale, gross or carload) or any other
unit treated in use or in the relevant market as a single whole. [1961 c.726 §72.1050]
72.1060 Definitions: “contract”; “agreement”;
“contract for sale”; “sale”; “present sale”; “conforming” to contract; “termination”;
“cancellation.” (1) In this chapter, unless the
context otherwise requires, “contract” and “agreement” are limited to those
relating to the present or future sale of goods. “Contract for sale” includes
both a present sale of goods and a contract to sell goods at a future time. A “sale”
consists in the passing of title from the seller to the buyer for a price. A “present
sale” means a sale which is accomplished by the making of the contract.
(2)
Goods or conduct including any part of a performance are “conforming” or
conform to the contract when they are in accordance with the obligations under
the contract.
(3)
“Termination” occurs when either party pursuant to a power created by agreement
or law puts an end to the contract otherwise than for its breach. On “termination”
all obligations which are still executory on both
sides are discharged but any right based on prior breach or performance
survives.
(4)
“Cancellation” occurs when either party puts an end to the contract for breach
by the other and its effect is the same as that of “termination” except that
the canceling party also retains any remedy for breach of the whole contract or
any unperformed balance. [1961 c.726 §72.1060]
72.1070 Goods to be severed from realty;
recording. (1) A contract for the sale of minerals
or the like (including oil and gas) or a structure or its materials to be
removed from realty is a contract for the sale of goods within this chapter if
they are to be severed by the seller but until severance a purported present
sale thereof which is not effective as a transfer of an interest in land is
effective only as a contract to sell.
(2)
A contract for the sale apart from the land of growing crops or other things
attached to realty and capable of severance without material harm thereto but
not described in subsection (1) of this section or of timber to be cut is a
contract for the sale of goods within this chapter whether the subject matter
is to be severed by the buyer or by the seller even though it forms part of the
realty at the time of contracting, and the parties can by identification effect
a present sale before severance.
(3)
The provisions of this section are subject to any third party rights provided
by the law relating to realty records, and the contract for sale may be
executed and recorded as a document transferring an interest in land and shall
then constitute notice to third parties of the buyer’s rights under the
contract for sale. [1961 c.726 §72.1070; 1963 c.402 §9; 1973 c.504 §3]
FORM, FORMATION AND READJUSTMENT OF
CONTRACT
72.2010 Formal requirements: statute of
frauds. (1) Except as otherwise provided in
this section a contract for the sale of goods for the price of $500 or more is
not enforceable by way of action or defense unless there is some writing
sufficient to indicate that a contract for sale has been made between the
parties and signed by the party against whom enforcement is sought or by the
authorized agent or broker of the party. A writing is not insufficient because
it omits or incorrectly states a term agreed upon but the contract is not
enforceable under this subsection beyond the quantity of goods shown in such
writing.
(2)
Between merchants, if within a reasonable time a writing in confirmation of the
contract and sufficient against the sender is received and the party receiving
it has reason to know its contents, it satisfies the requirements of subsection
(1) of this section against such party unless written notice of objection to
its contents is given within 10 days after it is received.
(3)
A contract which does not satisfy the requirements of subsection (1) of this
section but which is valid in other respects is enforceable:
(a)
If the goods are to be specially manufactured for the buyer and are not
suitable for sale to others in the ordinary course of the seller’s business and
the seller, before notice of repudiation is received and under circumstances
which reasonably indicate that the goods are for the buyer, has made either a
substantial beginning of their manufacture or commitments for their
procurement; or
(b)
If the party against whom enforcement is sought admits in pleading, testimony
or otherwise in court that a contract for sale was made, but the contract is
not enforceable under this provision beyond the quantity of goods admitted; or
(c)
With respect to goods for which payment has been made and accepted or which
have been received and accepted in accordance with ORS 72.6060. [1961 c.726 §72.2010]
72.2020 Final written expression: parol or extrinsic evidence.
Terms with respect to which the confirmatory memoranda of the parties agree or
which are otherwise set forth in a writing intended by the parties as a final
expression of their agreement with respect to such terms as are included
therein may not be contradicted by evidence of any prior agreement or of a
contemporaneous oral agreement but may be explained or supplemented:
(1)
By course of performance, course of dealing or usage of trade as provided in
ORS 71.3030; and
(2)
By evidence of consistent additional terms unless the court finds the writing
to have been intended also as a complete and exclusive statement of the terms
of the agreement. [1961 c.726 §72.2020; 2009 c.181 §26]
72.2030 Seals inoperative.
The affixing of a seal to a writing evidencing a contract for sale or an offer
to buy or sell goods does not constitute the writing a sealed instrument and
the law with respect to sealed instruments does not apply to such a contract or
offer. [1961 c.726 §72.2030]
72.2040 Formation in general.
(1) A contract for sale of goods may be made in any manner sufficient to show
agreement, including conduct by both parties which recognizes the existence of
such a contract.
(2)
An agreement sufficient to constitute a contract for sale may be found even
though the moment of its making is undetermined.
(3)
Even though one or more terms are left open a contract for sale does not fail
for indefiniteness if the parties have intended to make a contract and there is
a reasonably certain basis for giving an appropriate remedy. [1961 c.726 §72.2040]
72.2050 Firm offers.
An offer by a merchant to buy or sell goods in a signed writing which by its
terms gives assurance that it will be held open is not revocable, for lack of
consideration, during the time stated or if no time is stated for a reasonable
time, but in no event may such period of irrevocability exceed three months;
but any such term of assurance on a form supplied by the offeree
must be separately signed by the offeror. [1961 c.726
§72.2050]
72.2060 Offer and acceptance in formation
of contract. (1) Unless otherwise unambiguously
indicated by the language or circumstances:
(a)
An offer to make a contract shall be construed as inviting acceptance in any
manner and by any medium reasonable in the circumstances;
(b)
An order or other offer to buy goods for prompt or current shipment shall be
construed as inviting acceptance either by a prompt promise to ship or by the
prompt or current shipment of conforming or nonconforming goods, but such a
shipment of nonconforming goods does not constitute an acceptance if the seller
seasonably notifies the buyer that the shipment is offered only as an
accommodation to the buyer.
(2)
Where the beginning of a requested performance is a reasonable mode of
acceptance an offeror who is not notified of
acceptance within a reasonable time may treat the offer as having lapsed before
acceptance. [1961 c.726 §72.2060]
72.2070 Additional terms in acceptance or
confirmation. (1) A definite and seasonable
expression of acceptance or a written confirmation which is sent within a
reasonable time operates as an acceptance even though it states terms
additional to or different from those offered or agreed upon, unless acceptance
is expressly made conditional on assent to the additional or different terms.
(2)
The additional terms are to be construed as proposals for addition to the
contract. Between merchants such terms become part of the contract unless:
(a)
The offer expressly limits acceptance to the terms of the offer;
(b)
They materially alter it; or
(c)
Notification of objection to them has already been given or is given within a
reasonable time after notice of them is received.
(3)
Conduct by both parties which recognizes the existence of a contract is
sufficient to establish a contract for sale although the writings of the
parties do not otherwise establish a contract. In such case the terms of the
particular contract consist of those terms on which the writings of the parties
agree, together with any supplementary terms incorporated under any other
provisions of the Uniform Commercial Code. [1961 c.726 §72.2070]
72.2080 [1961
c.726 §72.2080; repealed by 2009 c.181 §116]
72.2090 Modification, rescission and
waiver. (1) An agreement modifying a contract
within this chapter needs no consideration to be binding.
(2)
A signed agreement which excludes modification or rescission except by a signed
writing cannot be otherwise modified or rescinded, but except as between merchants
such a requirement on a form supplied by the merchant must be separately signed
by the other party.
(3)
The requirements of ORS 72.2010, relating to the statute of frauds must be
satisfied if the contract as modified is within its provisions.
(4)
Although an attempt at modification or rescission does not satisfy the
requirements of subsection (2) or (3) of this section, it can operate as a
waiver.
(5)
A party who has made a waiver affecting an executory
portion of the contract may retract the waiver by reasonable notification
received by the other party that strict performance will be required of any
term waived, unless the retraction would be unjust in view of a material change
of position in reliance on the waiver. [1961 c.726 §72.2090]
72.2100 Delegation of performance;
assignment of rights. (1) A party may perform the duty
of the party through a delegate unless otherwise agreed or unless the other
party has a substantial interest in having the original promisor
perform or control the acts required by the contract. No delegation of
performance relieves the party delegating of any duty to perform or any
liability for breach.
(2)
Except as otherwise provided in ORS 79.0406, unless otherwise agreed, all
rights of either seller or buyer can be assigned except where the assignment
would materially change the duty of the other party, or increase materially the
burden or risk imposed on the other party by the contract, or impair materially
the chance of the other party obtaining return performance. A right to damages
for breach of the whole contract or a right arising out of the assignor’s due
performance of the entire obligation of the assignor can be assigned despite
agreement otherwise.
(3)
The creation, attachment, perfection or enforcement of a security interest in
the seller’s interest under a contract is not a transfer that materially
changes the duty of or increases materially the burden or risk imposed on the
buyer or impairs materially the buyer’s chance of obtaining return performance
within the purview of subsection (2) of this section unless, and then only to
the extent that, enforcement actually results in a delegation of material
performance of the seller. Even in that event, the creation, attachment,
perfection and enforcement of the security interest remain effective, but (i) the seller is liable to the buyer for damages caused by
the delegation to the extent that the damages could not reasonably be prevented
by the buyer, and (ii) a court having jurisdiction may grant other appropriate
relief, including cancellation of the contract for sale or an injunction
against enforcement of the security interest or consummation of the
enforcement.
(4)
Unless the circumstances indicate the contrary a prohibition of assignment of “the
contract” is to be construed as barring only the delegation to the assignee of
the assignor’s performance.
(5)
An assignment of “the contract” or of “all my rights under the contract” or an
assignment in similar general terms is an assignment of rights and unless the
language or the circumstances (as in an assignment for security) indicate the
contrary, it is a delegation of performance of the duties of the assignor and
its acceptance by the assignee constitutes a promise by the assignee to perform
those duties. This promise is enforceable by either the assignor or the other
party to the original contract.
(6)
The other party may treat any assignment which delegates performance as
creating reasonable grounds for insecurity and may without prejudice to the
rights of the other party against the assignor demand assurances from the
assignee as provided in ORS 72.6090. [1961 c.726 §72.2100; 2001 c.445 §133]
GENERAL OBLIGATION AND CONSTRUCTION OF
CONTRACT
72.3010 General obligations of parties.
The obligation of the seller is to transfer and deliver and that of the buyer
is to accept and pay in accordance with the contract. [1961 c.726 §72.3010]
72.3020 Unconscionable contract or clause.
(1) If the court as a matter of law finds the contract or any clause of the
contract to have been unconscionable at the time it was made the court may
refuse to enforce the contract, or it may enforce the remainder of the contract
without the unconscionable clause, or it may so limit the application of any
unconscionable clause as to avoid any unconscionable result.
(2)
When it is claimed or appears to the court that the contract or any clause
thereof may be unconscionable the parties shall be afforded a reasonable
opportunity to present evidence as to its commercial setting, purpose and effect
to aid the court in making the determination. [1961 c.726 §72.3020]
72.3030 Allocation or division of risks.
Where this chapter allocates a risk or a burden as between the parties “unless
otherwise agreed,” the agreement may not only shift the allocation but may also
divide the risk or burden. [1961 c.726 §72.3030]
72.3040 Price payable in money, goods,
realty or otherwise. (1) The price can be made
payable in money or otherwise. If it is payable in whole or in part in goods
each party is a seller of the goods which the party is to transfer.
(2)
Even though all or part of the price is payable in an interest in realty the
transfer of the goods and the seller’s obligations with reference to them are
subject to this chapter, but not the transfer of the interest in realty or the
transferor’s obligations in connection therewith. [1961 c.726 §72.3040]
72.3050 Open price term.
(1) The parties if they so intend can conclude a contract for sale even though
the price is not settled. In such a case the price is a reasonable price at the
time for delivery if:
(a)
Nothing is said as to price; or
(b)
The price is left to be agreed by the parties and they fail to agree; or
(c)
The price is to be fixed in terms of some agreed market or other standard as
set or recorded by a third person or agency and it is not so set or recorded.
(2)
A price to be fixed by the seller or by the buyer means a price for the seller
or buyer to fix in good faith.
(3)
When a price left to be fixed otherwise than by agreement of the parties fails
to be fixed through fault of one party the other may at the option of the other
party treat the contract as canceled or may fix a reasonable price.
(4)
Where, however, the parties intend not to be bound unless the price be fixed or
agreed and it is not fixed or agreed there is no contract. In such a case the
buyer must return any goods already received or if unable so to do must pay
their reasonable value at the time of delivery and the seller must return any
portion of the price paid on account. [1961 c.726 §72.3050]
72.3060 Output, requirements and exclusive
dealings. (1) A term which measures the quantity
by the output of the seller or the requirements of the buyer means such actual
output or requirements as may occur in good faith, except that no quantity
unreasonably disproportionate to any stated estimate or in the absence of a
stated estimate to any normal or otherwise comparable prior output or
requirements may be tendered or demanded.
(2)
A lawful agreement by either the seller or the buyer for exclusive dealing in
the kind of goods concerned imposes unless otherwise agreed an obligation by
the seller to use best efforts to supply the goods and by the buyer to use best
efforts to promote their sale. [1961 c.726 §72.3060]
72.3070 Delivery in single lot or several
lots. Unless otherwise agreed all goods
called for by a contract for sale must be tendered in a single delivery and
payment is due only on such tender but where the circumstances give either
party the right to make or demand delivery in lots the price if it can be
apportioned may be demanded for each lot. [1961 c.726 §72.3070]
72.3080 Absence of specified place for
delivery. Unless otherwise agreed:
(1)
The place for delivery of goods is the seller’s place of business or if the
seller has none the residence of the seller; but
(2)
In a contract for sale of identified goods which to the knowledge of the
parties at the time of contracting are in some other place, that place is the
place for their delivery; and
(3)
Documents of title may be delivered through customary banking channels. [1961
c.726 §72.3080]
72.3090 Absence of specific time provisions;
notice of termination. (1) The time for shipment or
delivery or any other action under a contract if not provided in this chapter
or agreed upon shall be a reasonable time.
(2)
Where the contract provides for successive performances but is indefinite in
duration it is valid for a reasonable time but unless otherwise agreed may be
terminated at any time by either party.
(3)
Termination of a contract by one party except on the happening of an agreed
event requires that reasonable notification be received by the other party and
an agreement dispensing with notification is invalid if its operation would be
unconscionable. [1961 c.726 §72.3090]
72.3100 Open time for payment or running
of credit; authority to ship under reservation.
Unless otherwise agreed:
(1)
Payment is due at the time and place at which the buyer is to receive the goods
even though the place of shipment is the place of delivery;
(2)
If the seller is authorized to send the goods the seller may ship them under
reservation, and may tender the documents of title, but, pursuant to ORS
72.5130, the buyer may inspect the goods after their arrival before payment is
due unless such inspection is inconsistent with the terms of the contract;
(3)
If delivery is authorized and made by way of documents of title otherwise than
by subsection (2) of this section then payment is due, regardless of where the
goods are to be received:
(a)
At the time and place at which the buyer is to receive delivery of the tangible
documents; or
(b)
At the time the buyer is to receive delivery of the electronic documents and at
the seller’s place of business or, if none, the seller’s residence; and
(4)
Where the seller is required or authorized to ship the goods on credit the
credit period runs from the time of shipment but postdating the invoice or
delaying its dispatch will correspondingly delay the starting of the credit
period. [1961 c.726 §72.3100; 2009 c.181 §27]
72.3110 Options and cooperation respecting
performance. (1) An agreement for sale which is
otherwise sufficiently definite to be a contract within ORS 72.2040 (3) is not
made invalid by the fact that it leaves particulars of performance to be
specified by one of the parties. Any such specification must be made in good
faith and within limits set by commercial reasonableness.
(2)
Unless otherwise agreed specifications relating to assortment of the goods are
at the buyer’s option and except as otherwise provided in ORS 72.3190 (1)(c)
and 72.3190 (3) specifications or arrangements relating to shipment are at the
seller’s option.
(3)
Where such specification would materially affect the other party’s performance
but is not seasonably made or where one party’s cooperation is necessary to the
agreed performance of the other but is not seasonably forthcoming, the other
party in addition to all other remedies:
(a)
Is excused for any resulting delay in the performance of that party; and
(b)
May also either proceed to perform in any reasonable manner or after the time
for a material part of the performance of that party treat the failure to
specify or to cooperate as a breach by failure to deliver or accept the goods. [1961
c.726 §72.3110]
72.3120 Warranty of title and against
infringement; buyer’s obligation against infringement.
(1) Subject to subsection (2) of this section there is in a contract for sale a
warranty by the seller that:
(a)
The title conveyed shall be good, and its transfer rightful; and
(b)
The goods shall be delivered free from any security interest or other lien or
encumbrance of which the buyer at the time of contracting has no knowledge.
(2)
A warranty under subsection (1) of this section will be excluded or modified
only by specific language or by circumstances which give the buyer reason to
know that the person selling does not claim title or that the person is
purporting to sell only such right or title as the person or a third person may
have.
(3)
Unless otherwise agreed a seller who is a merchant regularly dealing in goods
of the kind warrants that the goods shall be delivered free of the rightful
claim of any third person by way of infringement or the like, but a buyer who
furnishes specifications to the seller must hold the seller harmless against
any such claim which arises out of compliance with the specifications. [1961
c.726 §72.3120]
72.3130 Express warranties by affirmation,
promise, description, sample. (1) Express
warranties by the seller are created as follows:
(a)
Any affirmation of fact or promise made by the seller to the buyer which
relates to the goods and becomes part of the basis of the bargain creates an
express warranty that the goods shall conform to the affirmation or promise.
(b)
Any description of the goods which is made part of the basis of the bargain
creates an express warranty that the goods shall conform to the description.
(c)
Any sample or model which is made part of the basis of the bargain creates an
express warranty that the whole of the goods shall conform to the sample or
model.
(2)
It is not necessary to the creation of an express warranty that the seller use
formal words such as “warrant” or “guarantee” or that the seller have a
specific intention to make a warranty, but an affirmation merely of the value
of the goods or a statement purporting to be merely the seller’s opinion or
commendation of the goods does not create a warranty. [1961 c.726 §72.3130]
72.3140 Implied warranty: merchantability;
usage of trade. (1) Unless excluded or modified
as provided in ORS 72.3160, a warranty that the goods shall be merchantable is
implied in a contract for their sale if the seller is a merchant with respect
to goods of that kind. Under this section the serving for value of food or drink
to be consumed either on the premises or elsewhere is a sale.
(2)
Goods to be merchantable must be at least such as:
(a)
Pass without objection in the trade under the contract description; and
(b)
In the case of fungible goods, are of fair average quality within the
description; and
(c)
Are fit for the ordinary purposes for which such goods are used; and
(d)
Run, within the variations permitted by the agreement, of even kind, quality
and quantity within each unit and among all units involved; and
(e)
Are adequately contained, packaged and labeled as the agreement may require;
and
(f)
Conform to the promises or affirmations of fact made on the container or label
if any.
(3)
Unless excluded or modified as provided in ORS 72.3160 other implied warranties
may arise from course of dealing or usage of trade. [1961 c.726 §72.3140]
72.3150 Implied warranty: fitness for
particular purpose. Where the seller at the time of
contracting has reason to know any particular purpose for which the goods are
required and that the buyer is relying on the seller’s skill or judgment to
select or furnish suitable goods, there is unless excluded or modified under
ORS 72.3160 an implied warranty that the goods shall be fit for such purpose. [1961
c.726 §72.3150]
72.3160 Exclusion or modification of warranties;
livestock warranty. (1) Words or conduct relevant to
the creation of an express warranty and words or conduct tending to negate or
limit warranty shall be construed wherever reasonable as consistent with each
other; but subject to the provisions of ORS 72.2020 on parol
or extrinsic evidence negation or limitation is inoperative to the extent that
such construction is unreasonable.
(2)
Subject to subsection (3) of this section, to exclude or modify the implied
warranty of merchantability or any part of it the language must mention
merchantability and in case of a writing must be conspicuous, and to exclude or
modify any implied warranty of fitness the exclusion must be by a writing and
conspicuous. Language to exclude all implied warranties of fitness is
sufficient if it states, for example, that “There are no warranties which
extend beyond the description on the face hereof.”
(3)
Notwithstanding subsection (2) of this section:
(a)
Unless the circumstances indicate otherwise, all implied warranties are
excluded by expressions like “as is,” “with all faults” or other language which
in common understanding calls the buyer’s attention to the exclusion of
warranties and makes plain that there is no implied warranty; and
(b)
When the buyer before entering into the contract has examined the goods or the
sample or model as fully as the buyer desired or has refused to examine the
goods there is no implied warranty with regard to defects which an examination
ought in the circumstances to have revealed to the buyer; and
(c)
An implied warranty can also be excluded or modified by course of dealing or
course of performance or usage of trade; and
(d)
With respect to the sale of livestock between merchants, excluding livestock sold
for immediate slaughter, there shall be no implied warranty that the livestock
animal is free from disease except where the seller had knowledge or reason to
know that the animal was not free from disease at the time of the sale.
(4)
Remedies for breach of warranty can be limited in accordance with the
provisions of ORS 72.7180 on liquidation or limitation of damages and ORS
72.7190 on contractual modification of remedy. [1961 c.726 §72.3160; 1979 c.636
§2]
72.3170 Cumulation
and conflict of warranties express or implied.
Warranties whether express or implied shall be construed as consistent with
each other and as cumulative, but if such construction is unreasonable the
intention of the parties shall determine which warranty is dominant. In
ascertaining that intention the following rules apply:
(1)
Exact or technical specifications displace an inconsistent sample or model or
general language of description.
(2)
A sample from an existing bulk displaces inconsistent general language of
description.
(3)
Express warranties displace inconsistent implied warranties other than an
implied warranty of fitness for a particular purpose. [1961 c.726 §72.3170]
72.3180 Third party beneficiaries of warranties
express or implied. A seller’s warranty whether
express or implied extends to any natural person who is in the family or
household of the buyer or who is a guest in the home of the buyer if it is
reasonable to expect that such person may use, consume or be affected by the
goods and who is injured in person by breach of the warranty. A seller may not
exclude or limit the operation of this section. [1961 c.726 §72.3180]
72.3190 F.O.B. and F.A.S. terms.
(1) Unless otherwise agreed the term F.O.B. (which means “free on board”) at a
named place, even though used only in connection with the stated price, is a
delivery term under which:
(a)
When the term is F.O.B. the place of shipment, the seller must at that place
ship the goods in the manner provided in ORS 72.5040 and bear the expense and
risk of putting them into the possession of the carrier; or
(b)
When the term is F.O.B. the place of destination, the seller must at the
expense and risk of the seller transport the goods to that place and there
tender delivery of them in the manner provided in ORS 72.5030;
(c)
When under either (a) or (b) the term is also F.O.B. vessel, car or other
vehicle, the seller must in addition at the expense and risk of the seller load
the goods on board. If the term is F.O.B. vessel the buyer must name the vessel
and in an appropriate case the seller must comply with the provisions of ORS
72.3230 on the form of bill of lading.
(2)
Unless otherwise agreed the term F.A.S. vessel (which means “free alongside
ship”) at a named port, even though used only in connection with the stated price,
is a delivery term under which the seller must:
(a)
At the expense and risk of the seller deliver the goods alongside the vessel in
the manner usual in that port or on a dock designated and provided by the
buyer; and
(b)
Obtain and tender a receipt for the goods in exchange for which the carrier is
under a duty to issue a bill of lading.
(3)
Unless otherwise agreed in any case falling within paragraph (a) or (c) of
subsection (1) of this section or subsection (2) of this section the buyer must
seasonably give any needed instructions for making delivery, including when the
term is F.A.S. or F.O.B. the loading berth of the vessel and in an appropriate
case its name and sailing date. The seller may treat the failure of needed
instructions as a failure of cooperation as provided in ORS 72.3110. The seller
may also at the option of the seller move the goods in any reasonable manner
preparatory to delivery or shipment.
(4)
Under the term F.O.B. vessel or F.A.S. unless otherwise agreed the buyer must
make payment against tender of the required documents and the seller may not
tender nor the buyer demand delivery of the goods in substitution for the
documents. [1961 c.726 §72.3190]
72.3200 C.I.F. and C. and F. terms.
(1) The term C.I.F. means that the price includes in a lump sum the cost of the
goods and the insurance and freight to the named destination. The term C. and
F. or C.F. means that the price so includes cost and freight to the named
destination.
(2)
Unless otherwise agreed and even though used only in connection with the stated
price and destination, the term C.I.F. destination or its equivalent requires
the seller at the expense and risk of the seller to:
(a)
Put the goods into the possession of a carrier at the port for shipment and
obtain a negotiable bill or bills of lading covering the entire transportation
to the named destination; and
(b)
Load the goods and obtain a receipt from the carrier (which may be contained in
the bill of lading) showing that the freight has been paid or provided for; and
(c)
Obtain a policy or certificate of insurance, including any war risk insurance,
of a kind and on terms then current at the port of shipment in the usual
amount, in the currency of the contract, shown to cover the same goods covered
by the bill of lading and providing for payment of loss to the order of the
buyer or for the account of whom it may concern; but the seller may add to the
price the amount of the premium for any such war risk insurance; and
(d)
Prepare an invoice of the goods and procure any other documents required to
effect shipment or to comply with the contract; and
(e)
Forward and tender with commercial promptness all the documents in due form and
with any indorsement necessary to perfect the buyer’s
rights.
(3)
Unless otherwise agreed the term C. and F. or its equivalent has the same
effect and imposes upon the seller the same obligations and risks as a C.I.F.
term except the obligation as to insurance.
(4)
Under the term C.I.F. or C. and F. unless otherwise agreed the buyer must make
payment against tender of the required documents and the seller may not tender
nor the buyer demand delivery of the goods in substitution for the documents. [1961
c.726 §72.3200]
72.3210 C.I.F. or C. and F.: “net landed
weights”; “payment on arrival”; warranty of condition on arrival.
Under a contract containing a term C.I.F. or C. and F.:
(1)
Where the price is based on or is to be adjusted according to “net landed
weights”, “delivered weights,” “out turn” quantity or quality or the like,
unless otherwise agreed the seller must reasonably estimate the price. The
payment due on tender of the documents called for by the contract is the amount
so estimated, but after final adjustment of the price a settlement must be made
with commercial promptness.
(2)
An agreement described in subsection (1) of this section or any warranty of
quality or condition of the goods on arrival places upon the seller the risk of
ordinary deterioration, shrinkage and the like in transportation but has no
effect on the place or time of identification to the contract for sale or
delivery or on the passing of the risk of loss.
(3)
Unless otherwise agreed where the contract provides for payment on or after
arrival of the goods the seller must before payment allow such preliminary
inspection as is feasible; but if the goods are lost delivery of the documents
and payment are due when the goods should have arrived. [1961 c.726 §72.3210]
72.3220 Delivery “ex-ship.”
(1) Unless otherwise agreed a term for delivery of goods “ex-ship” (which means
from the carrying vessel) or in equivalent language is not restricted to a
particular ship and requires delivery from a ship which has reached a place at
the named port of destination where goods of the kind are usually discharged.
(2)
Under such a term unless otherwise agreed:
(a)
The seller must discharge all liens arising out of the carriage and furnish the
buyer with a direction which puts the carrier under a duty to deliver the
goods; and
(b)
The risk of loss does not pass to the buyer until the goods leave the ship’s
tackle or are otherwise properly unloaded. [1961 c.726 §72.3220]
72.3230 Form of bill of lading required in
overseas shipment; “overseas.” (1) Where the
contract contemplates overseas shipment and contains a term C.I.F. or C. and F.
or F.O.B. vessel, the seller unless otherwise agreed must obtain a negotiable
bill of lading stating that the goods have been loaded on board or, in the case
of a term C.I.F. or C. and F., received for shipment.
(2)
Where in a case within subsection (1) of this section a tangible bill of lading
has been issued in a set of parts, unless otherwise agreed if the documents are
not to be sent from abroad the buyer may demand tender of the full set;
otherwise only one part of the bill of lading need be tendered. Even if the
agreement expressly requires a full set:
(a)
Due tender of a single part is acceptable within the provisions of ORS 72.5080
(1) on cure of improper delivery; and
(b)
Even though the full set is demanded, if the documents are sent from abroad the
person tendering an incomplete set may nevertheless require payment upon
furnishing an indemnity which the buyer in good faith deems adequate.
(3)
A shipment by water or by air or a contract contemplating such shipment is “overseas”
in so far as by usage of trade or agreement it is subject to the commercial,
financing or shipping practices characteristic of international deep water
commerce. [1961 c.726 §72.3230; 2009 c.181 §28]
72.3240 “No arrival, no sale” term.
Under a term “no arrival, no sale” or terms of like meaning, unless otherwise
agreed:
(1)
The seller must properly ship conforming goods and if they arrive by any means
the seller must tender them on arrival but the seller assumes no obligation
that the goods will arrive unless the seller has caused the nonarrival;
and
(2)
Where without fault of the seller the goods are in part lost or have so
deteriorated as no longer to conform to the contract or arrive after the
contract time, the buyer may proceed as if there had been casualty to
identified goods as provided in ORS 72.6130. [1961 c.726 §72.3240]
72.3250 “Letter of credit” term; “confirmed
credit.” (1) Failure of the buyer seasonably to
furnish an agreed letter of credit is a breach of the contract for sale.
(2)
The delivery to seller of a proper letter of credit suspends the buyer’s
obligation to pay. If the letter of credit is dishonored, the seller may on
seasonable notification to the buyer require payment directly from the buyer.
(3)
Unless otherwise agreed the term “letter of credit” or “banker’s credit” in a
contract for sale means an irrevocable credit issued by a financing agency of
good repute and, where the shipment is overseas, of good international repute.
The term “confirmed credit” means that the credit must also carry the direct
obligation of such an agency which does business in the seller’s financial
market. [1961 c.726 §72.3250]
72.3260 Sale on approval and sale or return;
rights of creditors. (1) Unless otherwise agreed, if
delivered goods may be returned by the buyer even though they conform to the
contract, the transaction is:
(a)
A “sale on approval” if the goods are delivered primarily for use; and
(b)
A “sale or return” if the goods are delivered primarily for resale.
(2)
Goods held on approval are not subject to the claims of the buyer’s creditors
until acceptance; goods held on sale or return are subject to such claims while
in the buyer’s possession.
(3)
Any “or return” term of a contract for sale is to be treated as a separate
contract for sale within ORS 72.2010 relating to the statute of frauds and as
contradicting the sale aspect of the contract within the provisions of ORS
72.2020 on parole or extrinsic evidence. [1961 c.726 §72.3260; 1967 c.395 §1;
1993 c.756 §1; 2001 c.445 §134]
72.3270 Special incidents of sale on approval
and sale or return. (1) Under a sale on approval
unless otherwise agreed:
(a)
Although the goods are identified to the contract the risk of loss and the
title do not pass to the buyer until acceptance; and
(b)
Use of the goods consistent with the purpose of trial is not acceptance but
failure seasonably to notify the seller of election to return the goods is
acceptance, and if the goods conform to the contract acceptance of any part is
acceptance of the whole; and
(c)
After due notification of election to return, the return is at the seller’s
risk and expense but a merchant buyer must follow any reasonable instructions.
(2)
Under a sale or return unless otherwise agreed:
(a)
The option to return extends to the whole or any commercial unit of the goods
while in substantially their original condition, but must be exercised
seasonably; and
(b)
The return is at the buyer’s risk and expense. [1961 c.726 §72.3270]
72.3280 Sale by auction.
(1) In a sale by auction if goods are put up in lots each lot is the subject of
a separate sale.
(2)
A sale by auction is complete when the auctioneer so announces by the fall of
the hammer or in other customary manner. Where a bid is made while the hammer
is falling in acceptance of a prior bid the auctioneer may in the auctioneer’s
discretion reopen the bidding or declare the goods sold under the bid on which
the hammer was falling.
(3)
Such a sale is with reserve unless the goods are in explicit terms put up
without reserve. In an auction with reserve the auctioneer may withdraw the
goods at any time until the auctioneer announces completion of the sale. In an
auction without reserve, after the auctioneer calls for bids on an article or
lot, that article or lot cannot be withdrawn unless no bid is made within a
reasonable time. In either case a bidder may retract a bid until the auctioneer’s
announcement of completion of the sale, but a bidder’s retraction does not
revive any previous bid.
(4)
If the auctioneer knowingly receives a bid on the seller’s behalf or the seller
makes or procures such a bid, and notice has not been given that liberty for
such bidding is reserved, the buyer may at the buyer’s option avoid the sale or
take the goods at the price of the last good faith bid prior to the completion
of the sale. This subsection shall not apply to any bid at a forced sale. [1961
c.726 §72.3280; 1983 c.404 §4; 1985 c.822 §2]
TITLE, CREDITORS AND GOOD FAITH
PURCHASERS
72.4005 Definitions for ORS 72.4010 and
72.4030. As used in ORS 72.4010 and 72.4030, “draft,”
“check,” “certificate of deposit” and “note” have the meaning for those terms
provided in ORS 73.0104. [1973 c.287 §4; 1993 c.545 §117]
72.4010 Passing of title; reservation for
security; limited application of ORS 72.4010. Each
provision of this chapter with regard to the rights, obligations and remedies
of the seller, the buyer, purchasers or other third parties applies
irrespective of title to the goods except where the provision refers to such
title. In so far as situations are not covered by the other provisions of this
chapter and matters concerning title become material the following rules apply:
(1)
Title to goods cannot pass under a contract for sale prior to their
identification to the contract as provided in ORS 72.5010, and unless otherwise
explicitly agreed the buyer acquires by their identification a special property
as limited by the Uniform Commercial Code. Any retention or reservation by the
seller of the title (property) in goods shipped or delivered to the buyer is
limited in effect to a reservation of a security interest. Subject to these
provisions and to the provisions of ORS chapter 79 on secured transactions,
title to goods passes from the seller to the buyer in any manner and on any
conditions explicitly agreed on by the parties.
(2)
Unless otherwise explicitly agreed title passes to the buyer at the time and
place at which the seller completes performance with reference to the physical
delivery of the goods, despite any reservation of a security interest and even
though a document of title is to be delivered at a different time or place; and
in particular and despite any reservation of a security interest by the bill of
lading:
(a)
If the contract requires or authorizes the seller to send the goods to the
buyer but does not require the seller to deliver them at destination, title
passes to the buyer at the time and place of shipment; but
(b)
If the contract requires delivery at destination, title passes on tender there.
(3)
Unless otherwise explicitly agreed where delivery is to be made without moving
the goods:
(a)
If the seller is to deliver a tangible document of title, title passes at the
time when and the place where the seller delivers the document and if the
seller is to deliver an electronic document of title, title passes when the
seller delivers the document; or
(b)
If the goods are at the time of contracting already identified and no documents
of title are to be delivered, title passes at the time and place of
contracting.
(4)
When livestock has been delivered under a contract of sale and is transported
by private, common or contract carrier, if on the accompanying brand inspection
certificate or memorandum of brand inspection certificate the seller has noted
that as consideration for the sale of the livestock a draft, check, certificate
of deposit or note has been given, title does not pass until the instrument is
paid.
(5)
A rejection or other refusal by the buyer to receive or retain the goods,
whether or not justified, or a justified revocation of acceptance revests title to the goods in the seller. Such revesting occurs by operation of law and is not a “sale.” [1961
c.726 §72.4010; 1973 c.287 §1; 2001 c.445 §135; 2009 c.181 §29]
72.4020 Rights of seller’s creditors
against sold goods. (1) Except as provided in
subsections (2) and (3) of this section, rights of unsecured creditors of the
seller with respect to goods which have been identified to a contract for sale
are subject to the buyer’s rights to recover the goods pursuant to ORS 72.5020
and 72.7160.
(2)
A creditor of the seller may treat a sale or an identification of goods to a
contract for sale as void if as against the creditor a retention of possession
by the seller is fraudulent under any rule of law of the state where the goods
are situated, except that retention of possession in good faith and current
course of trade by a merchant-seller for a commercially reasonable time after a
sale or identification is not fraudulent.
(3)
Nothing in this chapter shall be deemed to impair the rights of creditors of
the seller:
(a)
Under the provisions of ORS chapter 79 on secured transactions; or
(b)
Where identification to the contract or delivery is made not in current course
of trade but in satisfaction of or as security for a preexisting claim for
money, security or the like and is made under circumstances which under any
rule of law of the state where the goods are situated would apart from this
chapter constitute the transaction a fraudulent transfer or voidable
preference. [1961 c.726 §72.4020; 2001 c.445 §136]
72.4030 Power to transfer; good faith
purchase of goods; “entrusting.” (1) A
purchaser of goods acquires all title which the transferor had or had power to
transfer except that a purchaser of a limited interest acquires rights only to
the extent of the interest purchased. A person with voidable title has power to
transfer a good title to a good faith purchaser for value. When goods have been
delivered under a transaction of purchase the purchaser has such power even though:
(a)
The transferor was deceived as to the identity of the purchaser; or
(b)
The delivery was in exchange for a check which is later dishonored; or
(c)
It was agreed that the transaction was to be a “cash sale”; or
(d)
The delivery was procured through fraud punishable as larcenous under the
criminal law.
(2)
Notwithstanding any other provision of this section, when livestock has been
delivered under a transaction of purchase, is transported by private, common or
contract carrier and on the accompanying brand inspection certificate or
memorandum of brand inspection certificate the seller has noted that as
consideration for the transaction of purchase a draft, check, certificate of
deposit or note was given, if the draft, check, certificate of deposit or note
is later dishonored, the buyer does not have power to transfer good title to a
good faith purchaser for value.
(3)
Any entrusting of possession of goods to a merchant who deals in goods of that
kind gives the merchant power to transfer all rights of the entruster
to a buyer in ordinary course of business.
(4)
“Entrusting” includes any delivery and any acquiescence in retention of
possession regardless of any condition expressed between the parties to the
delivery or acquiescence and regardless of whether the procurement of the
entrusting of the possessor’s disposition of the goods have been such as to be
larcenous under the criminal law.
(5)
The rights of other purchasers of goods and of lien creditors are governed by
ORS chapter 79 on secured transactions and ORS chapter 77 on documents of
title. [1961 c.726 §72.4030; 1973 c.287 §2; 1991 c.83 §4; 2001 c.445 §137]
PERFORMANCE
72.5010 Insurable interest in goods;
manner of identification of goods. (1) The buyer
obtains a special property and an insurable interest in goods by identification
of existing goods as goods to which the contract refers even though the goods
so identified are nonconforming and the buyer has an option to return or reject
them. Such identification can be made at any time and in any manner explicitly
agreed to by the parties. In the absence of explicit agreement identification
occurs:
(a)
When the contract is made if it is for the sale of goods already existing and
identified.
(b)
If the contract is for the sale of future goods other than those described in
paragraph (c) of this subsection, when goods are shipped, marked or otherwise
designated by the seller as goods to which the contract refers.
(c)
When the crops are planted or otherwise become growing crops or the young are
conceived if the contract is for the sale of unborn young to be born within 12
months after contracting or for the sale of crops to be harvested within 12
months or the next normal harvest season after contracting whichever is longer.
(2)
The seller retains an insurable interest in goods so long as title to or any
security interest in the goods remains in the seller and where the
identification is by the seller alone the seller may, until default or
insolvency or notification to the buyer that the identification is final,
substitute other goods for those identified.
(3)
Nothing in this section impairs any insurable interest recognized under any
other statute or rule of law. [1961 c.726 §72.5010]
72.5020 Buyer’s right to goods on seller’s
repudiation, failure to deliver or insolvency.
(1) Subject to subsections (2) and (3) of this section and even though the
goods have not been shipped, a buyer who has paid a part or all of the price of
goods in which the buyer has a special property under the provisions of ORS
72.5010 may on making and keeping good a tender of any unpaid portion of their
price recover them from the seller if:
(a)
In the case of goods bought for personal, family or household purposes, the
seller repudiates or fails to deliver as required by the contract; or
(b)
In all cases, the seller becomes insolvent within 10 days after receipt of the
first installment on their price.
(2)
The buyer’s right to recover the goods under subsection (1)(a) of this section
vests upon acquisition of a special property, even if the seller had not then
repudiated or failed to deliver.
(3)
If the identification creating the special property of the buyer has been made
by the buyer the buyer acquires the right to recover the goods only if they
conform to the contract for sale. [1961 c.726 §72.5020; 2001 c.104 §24; 2001
c.445 §138]
72.5030 Manner of seller’s tender of
delivery. (1) Tender of delivery requires that
the seller put and hold conforming goods at the buyer’s disposition and give
the buyer any notification reasonably necessary to enable the buyer to take
delivery. The manner, time and place for tender are determined by the agreement
and this chapter, and in particular:
(a)
Tender must be at a reasonable hour, and if it is of goods they must be kept available
for the period reasonably necessary to enable the buyer to take possession; but
(b)
Unless otherwise agreed the buyer must furnish facilities reasonably suited to
the receipt of the goods.
(2)
Where the case is within ORS 72.5040 respecting shipment tender requires that
the seller comply with its provisions.
(3)
Where the seller is required to deliver at a particular destination tender
requires that the seller comply with subsection (1) of this section and also in
any appropriate case tender documents as described in subsections (4) and (5)
of this section.
(4)
Where goods are in the possession of a bailee and are
to be delivered without being moved:
(a)
Tender requires that the seller either tender a negotiable document of title
covering such goods or procure acknowledgment by the bailee
of the buyer’s right to possession of the goods; but
(b)
Tender to the buyer of a nonnegotiable document of title or of a record
directing the bailee to deliver is sufficient tender
unless the buyer seasonably objects, and except as otherwise provided in ORS
chapter 79 receipt by the bailee of notification of
the buyer’s rights fixes those rights as against the bailee
and all third persons; but risk of loss of the goods and of any failure by the bailee to honor the nonnegotiable document of title or to
obey the direction remains on the seller until the buyer has had a reasonable
time to present the document or direction, and a refusal by the bailee to honor the document or to obey the direction
defeats the tender.
(5)
Where the contract requires the seller to deliver documents:
(a)
The seller must tender all such documents in correct form, except as provided
in ORS 72.3230 (2) with respect to bills of lading in a set; and
(b)
Tender through customary banking channels is sufficient and dishonor of a draft
accompanying or associated with the documents constitutes nonacceptance
or rejection. [1961 c.726 §72.5030; 2009 c.181 §30]
72.5040 Shipment by seller.
Where the seller is required or authorized to send the goods to the buyer and
the contract does not require the seller to deliver them at a particular
destination, then unless otherwise agreed the seller must:
(1)
Put the goods in the possession of such a carrier and make such a contract for
their transportation as may be reasonable having regard to the nature of the
goods and other circumstances of the case; and
(2)
Obtain and promptly deliver or tender in due form any
document necessary to enable the buyer to obtain possession of the goods or
otherwise required by the agreement or by usage of trade; and
(3)
Promptly notify the buyer of the shipment.
Failure to notify the buyer under
subsection (3) of this section or to make a proper contract under subsection
(1) of this section is a ground for rejection only if material delay or loss
ensues. [1961 c.726 §72.5040]
72.5050 Seller’s shipment under
reservation. (1) Where the seller has identified
goods to the contract by or before shipment:
(a)
The procurement by the seller of a negotiable bill of lading to the order of
the seller or otherwise reserves in the seller a security interest in the
goods. The procurement of the seller of the bill to the order of a financing
agency or of the buyer indicates in addition only the seller’s expectation of
transferring that interest to the person named.
(b)
A nonnegotiable bill of lading to the seller or nominee of the seller reserves
possession of the goods as security but except in a case of conditional
delivery as provided in ORS 72.5070 (2) a nonnegotiable bill of lading naming
the buyer as consignee reserves no security interest even though the seller
retains possession or control of the bill of lading.
(2)
When shipment by the seller with reservation of a security interest is in
violation of the contract for sale it constitutes an improper contract for
transportation within ORS 72.5040 but impairs neither the rights given to the
buyer by shipment and identification of the goods to the contract nor the
seller’s powers as a holder of a negotiable document of title. [1961 c.726 §72.5050;
2009 c.181 §31]
72.5060 Rights of financing agency.
(1) A financing agency by paying or purchasing for value a draft which relates
to a shipment of goods acquires to the extent of the payment or purchase and in
addition to its own rights under the draft and any document of title securing
it any rights of the shipper in the goods including the right to stop delivery
and the shipper’s right to have the draft honored by the buyer.
(2)
The right to reimbursement of a financing agency which has in good faith
honored or purchased the draft under commitment to or authority from the buyer
is not impaired by subsequent discovery of defects with reference to any
relevant document which was apparently regular. [1961 c.726 §72.5060; 2009
c.181 §32]
72.5070 Effect of seller’s tender;
delivery on condition. (1) Tender of delivery is a
condition to the buyer’s duty to accept the goods and, unless otherwise agreed,
to the duty of the buyer to pay for them. Tender entitles the seller to
acceptance of the goods and to payment according to the contract.
(2)
Where payment is due and demanded on the delivery to the buyer of goods or
documents of title, the right of the buyer as against the seller to retain or
dispose of them is conditional upon the buyer’s making the payment due. [1961
c.726 §72.5070]
72.5080 Cure by seller of improper tender
or delivery; replacement. (1) Where any tender or delivery
by the seller is rejected because nonconforming and the time for performance
has not yet expired, the seller may seasonably notify the buyer of the seller’s
intention to cure and may then within the contract time make a conforming
delivery.
(2)
Where the buyer rejects a nonconforming tender which the seller had reasonable
grounds to believe would be acceptable with or without money allowance the
seller may if the seller seasonably notifies the buyer have a further
reasonable time to substitute a conforming tender. [1961 c.726 §72.5080]
72.5090 Risk of loss in the absence of
breach. (1) Where the contract requires or
authorizes the seller to ship the goods by carrier:
(a)
If it does not require the seller to deliver them at a particular destination,
the risk of loss passes to the buyer when the goods are duly delivered to the
carrier even though the shipment is under reservation as provided in ORS
72.5050; but
(b)
If it does require the seller to deliver them at a particular destination and
the goods are there duly tendered while in the possession of the carrier, the
risk of loss passes to the buyer when the goods are there duly so tendered as
to enable the buyer to take delivery.
(2)
Where the goods are held by a bailee to be delivered
without being moved, the risk of loss passes to the buyer:
(a)
On the buyer’s receipt of possession or control of a negotiable document of
title covering the goods;
(b)
On acknowledgment by the bailee of the buyer’s right
to possession of the goods; or
(c)
After the buyer’s receipt of possession or control of a nonnegotiable document
of title or other direction to deliver in a record, as provided in ORS 72.5030
(4)(b).
(3)
In any case not within subsection (1) or (2) of this section, the risk of loss
passes to the buyer on receipt by the buyer of the goods if the seller is a
merchant; otherwise the risk passes to the buyer on tender of delivery.
(4)
The provisions of this section are subject to contrary agreement of the parties
and to the provisions of ORS 72.3270 on sale on approval and ORS 72.5100 on
effect of breach on risk of loss. [1961 c.726 §72.5090; 2009 c.181 §33]
72.5100 Effect of breach on risk of loss.
(1) Where a tender or delivery of goods so fails to conform to the contract as
to give a right of rejection the risk of their loss remains on the seller until
cure or acceptance.
(2)
Where the buyer rightfully revokes acceptance the buyer may to the extent of
any deficiency in the effective insurance coverage of the buyer treat the risk
of loss as having rested on the seller from the beginning.
(3)
Where the buyer as to conforming goods already identified to the contract for
sale repudiates or is otherwise in breach before risk of their loss has passed
to the buyer, the seller may to the extent of any deficiency in the effective
insurance coverage of the seller treat the risk of loss as resting on the buyer
for a commercially reasonable time. [1961 c.726 §72.5100]
72.5110 Tender of payment by buyer;
payment by check. (1) Unless otherwise agreed
tender of payment is a condition to the seller’s duty to tender and complete
any delivery.
(2)
Tender of payment is sufficient when made by any means or in any manner current
in the ordinary course of business unless the seller demands payment in legal
tender and gives any extension of time reasonably necessary to procure it.
(3)
Subject to the provisions of ORS 73.0310 on the effect of an instrument on an
obligation, payment by check is conditional and is defeated as between the
parties by dishonor of the check on due presentment. [1961 c.726 §72.5110; 1993
c.545 §118]
72.5120 Payment by buyer before
inspection. (1) Where the contract requires payment
before inspection nonconformity of the goods does not excuse the buyer from so
making payment unless:
(a)
The nonconformity appears without inspection; or
(b)
Despite tender of the required documents the circumstances would justify
injunction against honor under the provisions of ORS 75.1090.
(2)
Payment pursuant to subsection (1) of this section does not constitute an
acceptance of goods or impair the buyer’s right to inspect or any of the
remedies of the buyer. [1961 c.726 §72.5120; 1997 c.150 §4]
72.5130 Buyer’s right to inspection of
goods. (1) Unless otherwise agreed and subject
to subsection (3) of this section, where goods are tendered or delivered or
identified to the contract for sale, the buyer has a right before payment or
acceptance to inspect them at any reasonable place and time and in any
reasonable manner. When the seller is required or authorized to send the goods
to the buyer, the inspection may be after their arrival.
(2)
Expenses of inspection must be borne by the buyer but may be recovered from the
seller if the goods do not conform and are rejected.
(3)
Unless otherwise agreed and subject to the provisions of ORS 72.3210 (3) on
C.I.F. contracts, the buyer is not entitled to inspect the goods before payment
of the price when the contract provides:
(a)
For delivery “C.O.D.” or on other like terms; or
(b)
For payment against documents of title, except where such payment is due only
after the goods are to become available for inspection.
(4)
A place or method of inspection fixed by the parties is presumed to be
exclusive but unless otherwise expressly agreed it does not postpone
identification or shift the place for delivery or for passing the risk of loss.
If compliance becomes impossible, inspection shall be as provided in this
section unless the place or method fixed was clearly intended as an
indispensable condition failure of which avoids the contract. [1961 c.726 §72.5130]
72.5140 When documents deliverable on acceptance;
when on payment. Unless otherwise agreed
documents against which a draft is drawn are to be delivered to the drawee on acceptance of the draft if it is payable more
than three days after presentment; otherwise, only on payment. [1961 c.726 §72.5140]
72.5150 Preserving evidence of goods in
dispute. In furtherance of the adjustment of any
claim or dispute:
(1)
Either party on reasonable notification to the other and for the purpose of
ascertaining the facts and preserving evidence has the right to inspect, test
and sample the goods including such of them as may be in the possession or
control of the other; and
(2)
The parties may agree to a third party inspection or survey to determine the
conformity or condition of the goods and may agree that the findings shall be
binding upon them in any subsequent litigation or adjustment. [1961 c.726 §72.5150]
BREACH, REPUDIATION AND EXCUSE
72.6010 Buyer’s rights on improper
delivery. Subject to the provisions of ORS
72.6120 on breach in installment contracts and unless otherwise agreed under
ORS 72.7180 and 72.7190 on contractual limitations of remedy, if the goods or
the tender of delivery fail in any respect to conform to the contract, the
buyer may:
(1)
Reject the whole; or
(2)
Accept the whole; or
(3)
Accept any commercial unit or units and reject the rest. [1961 c.726 §72.6010]
72.6020 Manner and effect of rightful
rejection. (1) Rejection of goods must be within a
reasonable time after their delivery or tender. It is ineffective unless the
buyer seasonably notifies the seller.
(2)
Subject to the provisions of ORS 72.6030 and 72.6040 on rejected goods:
(a)
After rejection any exercise of ownership by the buyer with respect to any
commercial unit is wrongful as against the seller; and
(b)
If the buyer has before rejection taken physical possession of goods in which
the buyer does not have a security interest under the provisions of ORS 72.7110
(3), the buyer is under a duty after rejection to hold them with reasonable
care at the seller’s disposition for a time sufficient to permit the seller to
remove them; but
(c)
The buyer has no further obligations with regard to goods rightfully rejected.
(3)
The seller’s rights with respect to goods wrongfully rejected are governed by
the provisions of ORS 72.7030 on seller’s remedies in general. [1961 c.726 §72.6020]
72.6030 Merchant buyer’s duties as to rightfully
rejected goods. (1) Subject to any security
interest in the buyer as provided in ORS 72.7110 (3), when the seller has no
agent or place of business at the market of rejection a merchant buyer is under
a duty after rejection of goods in the possession or control of the merchant
buyer to follow any reasonable instructions received from the seller with
respect to the goods and in the absence of such instructions to make reasonable
efforts to sell them for the seller’s account if they are perishable or
threaten to decline in value speedily. Instructions are not reasonable if on
demand indemnity for expenses is not forthcoming.
(2)
When the buyer sells goods under subsection (1) of this section, the buyer is
entitled to reimbursement from the seller or out of the proceeds for reasonable
expenses of caring for and selling them, and if the expenses include no selling
commission then to such commission as is usual in the trade or if there is none
to a reasonable sum not exceeding 10 percent on the gross proceeds.
(3)
In complying with this section the buyer is held only to good faith and good
faith conduct hereunder is neither acceptance nor conversion nor the basis of
an action for damages. [1961 c.726 §72.6030]
72.6040 Buyer’s options as to salvage of rightfully
rejected goods. Subject to the provisions of ORS
72.6030 on perishables if the seller gives no instructions within a reasonable
time after notification of rejection the buyer may store the rejected goods for
the seller’s account or reship them to the seller or resell them for the seller’s
account with reimbursement as provided in ORS 72.6030. Such action is not
acceptance or conversion. [1961 c.726 §72.6040]
72.6050 Waiver of buyer’s objections by
failure to particularize. (1) The buyer’s failure to state
in connection with rejection a particular defect which is ascertainable by
reasonable inspection precludes the buyer from relying on the unstated defect
to justify rejection or to establish breach:
(a)
Where the seller could have cured it if stated seasonably; or
(b)
Between merchants when the seller has after rejection made a request in writing
for a full and final written statement of all defects on which the buyer proposes
to rely.
(2)
Payment against documents made without reservation of rights precludes recovery
of the payment for defects apparent in the documents. [1961 c.726 §72.6050;
2009 c.181 §34]
72.6060 What constitutes acceptance of
goods. (1) Acceptance of goods occurs when the
buyer:
(a)
After a reasonable opportunity to inspect the goods signifies to the seller
that the goods are conforming or that the buyer will take or retain them in
spite of their nonconformity; or
(b)
Fails to make an effective rejection as provided in ORS 72.6020 (1), but such
acceptance does not occur until the buyer has had a reasonable opportunity to
inspect them; or
(c)
Does any act inconsistent with the seller’s ownership; but if such act is
wrongful as against the seller it is an acceptance only if ratified by the
seller.
(2)
Acceptance of a part of any commercial unit is acceptance of that entire unit. [1961
c.726 §72.6060]
72.6070 Effect of acceptance; notice of
breach; burden of establishing breach after acceptance; notice of claim or
litigation to person answerable over. (1) The buyer
must pay at the contract rate for any goods accepted.
(2)
Acceptance of goods by the buyer precludes rejection of the goods accepted and
if made with knowledge of a nonconformity cannot be revoked because of it
unless the acceptance was on the reasonable assumption that the nonconformity
would be seasonably cured but acceptance does not of itself impair any other
remedy provided by this chapter for nonconformity.
(3)
Where a tender has been accepted:
(a)
The buyer must within a reasonable time after the buyer discovers or should
have discovered any breach notify the seller of breach or be barred from any
remedy; and
(b)
If the claim is one for infringement or the like pursuant to ORS 72.3120 (3)
and the buyer is sued as a result of such a breach
the buyer must so notify the seller within a reasonable time after the buyer
receives notice of the litigation or be barred from any remedy over for
liability established by the litigation.
(4)
The burden is on the buyer to establish any breach with respect to the goods
accepted.
(5)
Where the buyer is sued for breach of a warranty or other obligation for which
the seller is answerable over:
(a)
The buyer may give the seller written notice of the litigation. If the notice
states that the seller may come in and defend and that if the seller does not
do so the seller will be bound in any action against the seller by the buyer by
any determination of fact common to the two litigations, then unless the seller
after seasonable receipt of the notice does come in and defend the seller is so
bound.
(b)
If the claim is one for infringement or the like pursuant to ORS 72.3120 (3)
the original seller may demand in writing that the buyer turn over to the
seller control of the litigation including settlement or else be barred from
any remedy over and if the seller also agrees to bear all expense and to
satisfy any adverse judgment, then unless the buyer after seasonable receipt of
the demand does turn over control the buyer is so barred.
(6)
The provisions of subsections (3), (4) and (5) of this section apply to any
obligation of a buyer to hold the seller harmless against infringement or the
like pursuant to ORS 72.3120 (3). [1961 c.726 §72.6070]
72.6080 Revocation of acceptance in whole
or in part. (1) The buyer may revoke acceptance of
a lot or commercial unit whose nonconformity substantially impairs its value to
the buyer if the buyer has accepted it:
(a)
On the reasonable assumption that its nonconformity would be cured and it has
not been seasonably cured; or
(b)
Without discovery of such nonconformity if the acceptance was reasonably
induced either by the difficulty of discovery before acceptance or by the
seller’s assurances.
(2)
Revocation of acceptance must occur within a reasonable time after the buyer
discovers or should have discovered the ground for it and before any
substantial change in condition of the goods which is not caused by their own
defects. It is not effective until the buyer notifies the seller of it.
(3)
A buyer who so revokes has the same rights and duties with regard to the goods
involved as if the buyer had rejected them. [1961 c.726 §72.6080]
72.6090 Right to adequate assurance of
performance. (1) A contract for sale imposes an
obligation on each party that the other’s expectation of receiving due
performance will not be impaired. When reasonable grounds for insecurity arise
with respect to the performance of either party the other may in writing demand
adequate assurance of due performance and until that party receives such
assurance may if commercially reasonable suspend any performance for which that
party has not already received the agreed return.
(2)
Between merchants the reasonableness of grounds for insecurity and the adequacy
of any assurance offered shall be determined according to commercial standards.
(3)
Acceptance of any improper delivery or payment does not prejudice the aggrieved
party’s right to demand adequate assurance of future performance.
(4)
After receipt of a justified demand failure to provide within a reasonable time
not exceeding 30 days such assurance of due performance as is adequate under
the circumstances of the particular case is a repudiation of the contract. [1961
c.726 §72.6090]
72.6100 Anticipatory repudiation.
When either party repudiates the contract with respect to a performance not yet
due the loss of which will substantially impair the value of the contract to
the other, the aggrieved party may:
(1)
For a commercially reasonable time await performance by the repudiating party;
or
(2)
Resort to any remedy for breach as provided in ORS 72.7030 and 72.7110, even
though the aggrieved party has notified the repudiating party that the
aggrieved party would await the latter’s performance and has urged retraction;
and
(3)
In either case suspend the performance of the aggrieved party or proceed in
accordance with the provisions of ORS 72.7040 on the seller’s right to identify
goods to the contract notwithstanding breach or to salvage unfinished goods. [1961
c.726 §72.6100]
72.6110 Retraction of anticipatory
repudiation. (1) Until the repudiating party’s next
performance is due the repudiating party can retract the repudiation unless the
aggrieved party has since the repudiation canceled or materially changed
position or otherwise indicated that the aggrieved party considers the
repudiation final.
(2)
Retraction may be by any method which clearly indicates to the aggrieved party
that the repudiating party intends to perform, but must include any assurance
justifiably demanded under the provisions of ORS 72.6090.
(3)
Retraction reinstates the repudiating party’s rights under the contract with
due excuse and allowance to the aggrieved party for any delay occasioned by the
repudiation. [1961 c.726 §72.6110]
72.6120 “Installment contract”; breach.
(1) An “installment contract” is one which requires or authorizes the delivery
of goods in separate lots to be separately accepted, even though the contract
contains a clause “each delivery is a separate contract” or its equivalent.
(2)
The buyer may reject any installment which is nonconforming if the
nonconformity substantially impairs the value of that installment and cannot be
cured or if the nonconformity is a defect in the required documents; but if the
nonconformity does not fall within subsection (3) of this section and the
seller gives adequate assurance of its cure the buyer must accept that
installment.
(3)
Whenever nonconformity or default with respect to one or more installments
substantially impairs the value of the whole contract there is a breach of the
whole. But the aggrieved party reinstates the contract if the aggrieved party
accepts a nonconforming installment without seasonably notifying of
cancellation or if the aggrieved party brings an action with respect only to
past installments or demands performance as to future installments. [1961 c.726
§72.6120]
72.6130 Casualty to identified goods.
Where the contract requires for its performance goods identified when the
contract is made, and the goods suffer casualty without fault of either party
before the risk of loss passes to the buyer, or in a proper case under a “no
arrival, no sale” term as provided in ORS 72.3240 then:
(1)
If the loss is total the contract is avoided; and
(2)
If the loss is partial or the goods have so deteriorated as no longer to
conform to the contract the buyer may nevertheless demand inspection and at the
option of the buyer either treat the contract as avoided or accept the goods
with due allowance from the contract price for the deterioration or the
deficiency in quantity but without further right against the seller. [1961
c.726 §72.6130]
72.6140 Substituted performance.
(1) Where without fault of either party the agreed berthing, loading, or
unloading facilities fail or an agreed type of carrier becomes unavailable or
the agreed manner of delivery otherwise becomes commercially impracticable but
a commercially reasonable substitute is available, such substitute performance
must be tendered and accepted.
(2)
If the agreed means or manner of payment fails because of domestic or foreign
governmental regulation, the seller may withhold or stop delivery unless the
buyer provides a means or manner of payment which is commercially a substantial
equivalent. If delivery has already been taken, payment by the means or in the
manner provided by the regulation discharges the buyer’s obligation unless the
regulation is discriminatory, oppressive or predatory. [1961 c.726 §72.6140]
72.6150 Excuse by failure of presupposed
conditions. Except so far as a seller may have
assumed a greater obligation and subject to the preceding section on
substituted performance:
(1)
Delay in delivery or nondelivery in whole or in part
by a seller who complies with subsections (2) and (3) of this section is not a
breach of duty under a contract for sale if performance as agreed has been made
impracticable by the occurrence of a contingency the nonoccurrence of which was
a basic assumption on which the contract was made or by compliance in good
faith with any applicable foreign or domestic governmental regulation or order
whether or not it later proves to be invalid.
(2)
Where the causes mentioned in subsection (1) of this section affect only a part
of the seller’s capacity to perform, the seller must allocate production and
deliveries among customers but may at the option of the seller include regular
customers not then under contract as well as the requirements of the seller for
further manufacture. The seller may so allocate in any manner which is fair and
reasonable.
(3)
The seller must notify the buyer seasonably that there will be delay or nondelivery and, when allocation is required under
subsection (2) of this section, of the estimated quota thus made available for
the buyer. [1961 c.726 §72.6150]
72.6160 Procedure on notice claiming
excuse. (1) Where the buyer receives
notification of a material or indefinite delay or an allocation justified under
ORS 72.6150 the buyer may by written notification to the seller as to any
delivery concerned, and where the prospective deficiency substantially impairs
the value of the whole contract under the provisions of ORS 72.6120 relating to
breach of installment contracts, then also as to the whole:
(a)
Terminate and thereby discharge any unexecuted portion of the contract; or
(b)
Modify the contract by agreeing to take the available quota in substitution.
(2)
If after receipt of such notification from the seller the buyer fails so to
modify the contract within a reasonable time not exceeding 30 days the contract
lapses with respect to any deliveries affected.
(3)
The provisions of this section may not be negated by agreement except in so far
as the seller has assumed a greater obligation under ORS 72.6150. [1961 c.726 §72.6160]
REMEDIES
72.7010 Remedies for breach of collateral
contracts not impaired. Remedies for breach of any
obligation or promise collateral or ancillary to a contract for sale are not
impaired by the provisions of this chapter. [1961 c.726 §72.7010]
72.7020 Seller’s remedies on discovery of
buyer’s insolvency. (1) Where the seller discovers
the buyer to be insolvent the seller may refuse delivery except for cash
including payment for all goods theretofore delivered under the contract, and
stop delivery under ORS 72.7050.
(2)
Where the seller discovers that the buyer has received goods on credit while
insolvent the seller may reclaim the goods upon demand made within 10 days
after the receipt, but if misrepresentation of solvency has been made to the
particular seller in writing within three months before delivery the 10-day
limitation does not apply. Except as provided in this subsection the seller may
not base a right to reclaim goods on the buyer’s fraudulent or innocent
misrepresentation of solvency or of intent to pay.
(3)
The seller’s right to reclaim under subsection (2) of this section is subject
to the rights of a buyer in ordinary course or other good faith purchaser or
lien creditor under ORS 72.4030. Successful reclamation of goods excludes all
other remedies with respect to them. [1961 c.726 §72.7020]
72.7030 Seller’s remedies in general.
Where the buyer wrongfully rejects or revokes acceptance of goods or fails to
make a payment due on or before delivery or repudiates with respect to a part
or the whole, then with respect to any goods directly affected and, if the
breach is of the whole contract as provided in ORS 72.6120, then also with
respect to the whole undelivered balance, the aggrieved seller may:
(1)
Withhold delivery of such goods.
(2)
Stop delivery by any bailee as provided in ORS
72.7050.
(3)
Proceed under ORS 72.7040 respecting goods still unidentified to the contract.
(4)
Resell and recover damages as provided in ORS 72.7060.
(5)
Recover damages for nonacceptance as provided in ORS
72.7080 or in a proper case the price as provided in ORS 72.7090.
(6)
Cancel. [1961 c.726 §72.7030]
72.7040 Seller’s right to identify goods
to the contract notwithstanding breach or to salvage unfinished goods.
(1) An aggrieved seller under ORS 72.7030 may:
(a)
Identify to the contract conforming goods not already identified if at the time
the aggrieved seller learned of the breach they are in the possession or
control of the aggrieved seller.
(b)
Treat as the subject of resale goods which have demonstrably been intended for
the particular contract even though those goods are unfinished.
(2)
Where the goods are unfinished an aggrieved seller may in the exercise of
reasonable commercial judgment for the purposes of avoiding loss and of
effective realization either complete the manufacture and wholly identify the
goods to the contract or cease manufacture and resell for scrap or salvage
value or proceed in any other reasonable manner. [1961 c.726 §72.7040]
72.7050 Seller’s stoppage of delivery in
transit or otherwise. (1) The seller may stop delivery
of goods in the possession of a carrier or other bailee
when the seller discovers the buyer to be insolvent as provided in ORS 72.7020
and may stop delivery of carload, truckload, planeload or larger shipments of
express or freight when the buyer repudiates or fails to make a payment due
before delivery or if for any other reason the seller has a right to withhold
or reclaim the goods.
(2)
As against such buyer the seller may stop delivery until:
(a)
Receipt of the goods by the buyer;
(b)
Acknowledgment to the buyer by any bailee of the
goods except a carrier that the bailee holds the
goods for the buyer;
(c)
Such acknowledgment to the buyer by a carrier by reshipment or as a warehouse;
or
(d)
Negotiation to the buyer of any negotiable document of title covering the
goods.
(3)(a)
To stop delivery the seller must so notify as to enable the bailee
by reasonable diligence to prevent delivery of the goods.
(b)
After such notification the bailee must hold and
deliver the goods according to the directions of the seller but the seller is
liable to the bailee for any ensuing charges or
damages.
(c)
If a negotiable document of title has been issued for goods the bailee is not obliged to obey a notification to stop until
surrender of possession or control of the document.
(d)
A carrier who has issued a nonnegotiable bill of lading is not obliged to obey
a notification to stop received from a person other than the consignor. [1961
c.726 §72.7050; 2009 c.181 §35]
72.7060 Seller’s resale including contract
for resale. (1) Under the conditions stated in ORS
72.7030 on seller’s remedies, the seller may resell the goods concerned or the
undelivered balance thereof. Where the resale is made in good faith and in a
commercially reasonable manner the seller may recover the difference between
the resale price and the contract price together with any incidental damages
allowed under the provisions of ORS 72.7100, but less expenses saved in
consequence of the buyer’s breach.
(2)
Except as otherwise provided in subsection (3) of this section or unless
otherwise agreed resale may be at public or private sale including sale by way
of one or more contracts to sell or of identification to an existing contract
of the seller. Sale may be as a unit or in parcels and at any time and place
and on any terms but every aspect of the sale including the method, manner,
time, place and terms must be commercially reasonable. The resale must be
reasonably identified as referring to the broken contract, but it is not
necessary that the goods be in existence or that any or all of them have been
identified to the contract before the breach.
(3)
Where the resale is at private sale the seller must give the buyer reasonable
notification of intention to resell.
(4)
Where the resale is at public sale:
(a)
Only identified goods can be sold except where there is a recognized market for
a public sale of futures in goods of the kind; and
(b)
It must be made at a usual place or market for public sale if one is reasonably
available and except in the case of goods which are perishable or threaten to
decline in value speedily the seller must give the buyer reasonable notice of
the time and place of the resale; and
(c)
If the goods are not to be within the view of those attending the sale the
notification of sale must state the place where the goods are located and
provide for their reasonable inspection by prospective bidders; and
(d)
The seller may buy.
(5)
A purchaser who buys in good faith at a resale takes the goods free of any
rights of the original buyer even though the seller fails to comply with one or
more of the requirements of this section.
(6)
The seller is not accountable to the buyer for any profit made on any resale. A
person in the position of a seller pursuant to ORS 72.7070 or a buyer who has
rightfully rejected or justifiably revoked acceptance must account for any
excess over the amount of the security interest of the person, as defined in
ORS 72.7110 (3). [1961 c.726 §72.7060]
72.7070 “Person in the position of a
seller.” (1) A “person in the position of a
seller” includes as against a principal an agent who has paid or become
responsible for the price of goods on behalf of the principal or anyone who
otherwise holds a security interest or other right in goods similar to that of
a seller.
(2)
A person in the position of a seller may as provided in ORS 72.7050 withhold or
stop delivery and resell as provided in ORS 72.7060 and recover incidental
damages as provided in ORS 72.7100. [1961 c.726 §72.7070]
72.7080 Seller’s damages for nonacceptance or repudiation.
(1) Subject to subsection (2) of this section and to the provisions of ORS
72.7230 with respect to proof of market price, the measure of damages for nonacceptance or repudiation by the buyer is the difference
between the market price at the time and place for tender and the unpaid
contract price together with any incidental damages provided in ORS 72.7100,
but less expenses saved in consequence of the buyer’s breach.
(2)
If the measure of damages provided in subsection (1) of this section is
inadequate to put the seller in as good a position as performance would have
done then the measure of damages is the profit (including reasonable overhead)
which the seller would have made from full performance by the buyer, together
with any incidental damages provided in ORS 72.7100, due allowance for costs
reasonably incurred and due credit for payments or proceeds of resale. [1961
c.726 §72.7080]
72.7090 Action for the price.
(1) When the buyer fails to pay the price as it becomes due the seller may
recover, together with any incidental damages under ORS 72.7100, the price:
(a)
Of goods accepted or of conforming goods lost or damaged within a commercially
reasonable time after risk of their loss has passed to the buyer; and
(b)
Of goods identified to the contract if the seller is unable after reasonable
effort to resell them at a reasonable price or the circumstances reasonably
indicate that such effort will be unavailing.
(2)
Where the seller sues for the price the seller must hold for the buyer any
goods which have been identified to the contract and are still in the control
of the seller except that if resale becomes possible the seller may resell them
at any time prior to the collection of the judgment. The net proceeds of any
such resale must be credited to the buyer and payment of the judgment entitles
the buyer to any goods not resold.
(3)
After the buyer has wrongfully rejected or revoked acceptance of the goods or
has failed to make a payment due or has repudiated as provided in ORS 72.6100,
a seller who is held not entitled to the price under this section shall
nevertheless be awarded damages for nonacceptance
under ORS 72.7080. [1961 c.726 §72.7090; 1973 c.352 §1]
72.7100 Seller’s incidental damages.
Incidental damages to an aggrieved seller include any commercially reasonable
charges, expenses or commissions incurred in stopping delivery, in the
transportation, care and custody of goods after the buyer’s breach, in
connection with return or resale of the goods or otherwise resulting from the
breach. [1961 c.726 §72.7100]
72.7110 Buyer’s remedies in general; buyer’s
security interest in rejected goods. (1) Where the
seller fails to make delivery or repudiates or the buyer rightfully rejects or
justifiably revokes acceptance then with respect to any goods involved, and
with respect to the whole if the breach goes to the whole contract as provided
in ORS 72.6120, the buyer may cancel and whether or not the buyer has done so
may in addition to recovering so much of the price as has been paid:
(a)
“Cover” and have damages under ORS 72.7120 as to all the goods affected whether
or not they have been identified to the contract; or
(b)
Recover damages for nondelivery as provided in ORS
72.7130.
(2)
Where the seller fails to deliver or repudiates the buyer may also:
(a)
If the goods have been identified recover them as provided in ORS 72.5020; or
(b)
In a proper case obtain specific performance or replevy
the goods as provided in ORS 72.7160.
(3)
On rightful rejection or justifiable revocation of acceptance a buyer has a
security interest in goods in the possession or control of the buyer for any
payments made on their price and any expenses reasonably incurred in their
inspection, receipt, transportation, care and custody and may hold such goods
and resell them in like manner as an aggrieved seller as provided in ORS
72.7060. [1961 c.726 §72.7110]
72.7120 “Cover”; buyer’s procurement of
substitute goods. (1) After a breach within ORS
72.7110 the buyer may “cover” by making in good faith and without unreasonable
delay any reasonable purchase of or contract to purchase goods in substitution
for those due from the seller.
(2)
The buyer may recover from the seller as damages the difference between the
cost of cover and the contract price together with any incidental or
consequential damages as defined in ORS 72.7150, but less expenses saved in
consequence of the seller’s breach.
(3)
Failure of the buyer to effect cover within this section does not bar the buyer
from any other remedy. [1961 c.726 §72.7120]
72.7130 Buyer’s damages for nondelivery or repudiation.
(1) Subject to the provisions of ORS 72.7230 with respect to proof of market
price, the measure of damages for nondelivery or
repudiation by the seller is the difference between the market price at the
time when the buyer learned of the breach and the contract price together with
any incidental and consequential damages provided in ORS 72.7150, but less
expenses saved in consequence of the seller’s breach.
(2)
Market price is to be determined as of the place for tender or, in case of
rejection after arrival or revocation of acceptance, as of the place of
arrival. [1961 c.726 §72.7130]
72.7140 Buyer’s damages for breach in
regard to accepted goods. (1) Where the buyer has accepted
goods and given notification as provided in ORS 72.6070 (3) the buyer may
recover as damages for any nonconformity of tender the loss resulting in the
ordinary course of events from the seller’s breach as determined in any manner
which is reasonable.
(2)
The measure of damages for breach of warranty is the difference at the time and
place of acceptance between the value of the goods accepted and the value they
would have had if they had been as warranted, unless special circumstances show
proximate damages of a different amount.
(3)
In a proper case any incidental and consequential damages under ORS 72.7150 may
also be recovered. [1961 c.726 §72.7140]
72.7150 Buyer’s incidental and
consequential damages. (1) Incidental damages resulting
from the seller’s breach include expenses reasonably incurred in inspection,
receipt, transportation and care and custody of goods rightfully rejected, any
commercially reasonable charges, expenses or commissions in connection with effecting
cover and any other reasonable expense incident to the delay or other breach.
(2)
Consequential damages resulting from the seller’s breach include:
(a)
Any loss resulting from general or particular requirements and needs of which
the seller at the time of contracting had reason to know and which could not
reasonably be prevented by cover or otherwise; and
(b)
Injury to person or property proximately resulting from any breach of warranty.
[1961 c.726 §72.7150]
72.7160 Buyer’s right to specific performance
or replevin. (1) A
judgment requiring specific performance may be entered if the goods are unique
or in other proper circumstances.
(2)
The judgment for specific performance may include such terms and conditions as
to payment of the price, damages or other relief as the court may deem just.
(3)
The buyer has a right of replevin for goods
identified to the contract if after reasonable effort the buyer is unable to
effect cover for such goods or the circumstances reasonably indicate that such
effort will be unavailing or if the goods have been shipped under reservation
and satisfaction of the security interest in them has been made or tendered. In
the case of goods bought for personal, family or household purposes, the buyer’s
right of replevin vests upon acquisition of a special
property, even if the seller had not then repudiated or failed to deliver. [1961
c.726 §72.7160; 2001 c.445 §139; 2003 c.576 §333]
72.7170 Deduction of damages from the
price. The buyer on notifying the seller of
the intention of the buyer to do so may deduct all or any part of the damages
resulting from any breach of the contract from any part of the price still due
under the same contract. [1961 c.726 §72.7170]
72.7180 Liquidation or limitation of
damages; deposits. (1) Damages for breach by either
party may be liquidated in the agreement but only at an amount which is
reasonable in the light of the anticipated or actual harm caused by the breach,
the difficulties of proof of loss, and the inconvenience or nonfeasibility
of otherwise obtaining an adequate remedy. A term fixing unreasonably large
liquidated damages is void as a penalty.
(2)
Where the seller justifiably withholds delivery of goods because of the buyer’s
breach, the buyer is entitled to restitution of any amount by which the sum of
the buyer’s payments exceeds:
(a)
The amount to which the seller is entitled by virtue of terms liquidating the
seller’s damages in accordance with subsection (1) of this section; or
(b)
In the absence of such terms, 20 percent of the value of the total performance
for which the buyer is obligated under the contract or $500, whichever is
smaller.
(3)
The buyer’s right to restitution under subsection (2) of this section is
subject to offset to the extent that the seller establishes:
(a)
A right to recover damages under the provisions of this chapter other than
subsection (1) of this section; and
(b)
The amount or value of any benefits received by the buyer directly or
indirectly by reason of the contract.
(4)
Where a seller has received payment in goods their reasonable value or the
proceeds of their resale shall be treated as payments for the purposes of
subsection (2) of this section; but if the seller has notice of the buyer’s
breach before reselling goods received in part performance, the resale is
subject to the conditions laid down in ORS 72.7060 on resale by an aggrieved
seller. [1961 c.726 §72.7180]
72.7190 Contractual modification or
limitation of remedy. (1) Subject to the provisions of
subsections (2) and (3) of this section and of ORS 72.7180 on liquidation and
limitation of damages:
(a)
The agreement may provide for remedies in addition to or in substitution for
those provided in this chapter and may limit or alter the measure of damages
recoverable under this chapter, as by limiting the buyer’s remedies to return
of the goods and repayment of the price or to repair and replacement of
nonconforming goods or parts; and
(b)
Resort to a remedy as provided is optional unless the remedy is expressly
agreed to be exclusive, in which case it is the sole remedy.
(2)
Where circumstances cause an exclusive or limited remedy to fail of its
essential purpose, remedy may be had as provided in the Uniform Commercial
Code.
(3)
Consequential damages may be limited or excluded unless the limitation or
exclusion is unconscionable. Limitation of consequential damages for injury to
the person in the case of consumer goods is prima facie unconscionable but
limitation of damages where the loss is commercial is not. [1961 c.726 §72.7190]
72.7200 Effect of “cancellation” or “rescission”
on claims for antecedent breach. Unless the
contrary intention clearly appears, expressions of “cancellation” or “rescission”
of the contract or the like shall not be construed as a renunciation or discharge
of any claim in damages for an antecedent breach. [1961 c.726 §72.7200]
72.7210 Remedies for fraud.
Remedies for material misrepresentation or fraud include all remedies available
under this chapter for nonfraudulent breach. Neither
rescission or a claim for rescission of the contract for sale nor rejection or
return of the goods shall bar or be deemed inconsistent with a claim for
damages or other remedy. [1961 c.726 §72.7210]
72.7220 Who can sue third parties for
injury to goods. Where a third party so deals
with goods which have been identified to a contract for sale as to cause
actionable injury to a party to that contract:
(1)
A right of action against the third party is in either party to the contract
for sale who has title to or a security interest or a special property or an
insurable interest in the goods; and if the goods have been destroyed or
converted a right of action is also in the party who either bore the risk of
loss under the contract for sale or has since the injury assumed that risk as
against the other.
(2)
If at the time of the injury the party plaintiff did not bear the risk of loss
as against the other party to the contract for sale and there is no arrangement
between them for disposition of the recovery, the suit or settlement of the
party plaintiff is, subject to the interest of the party plaintiff, as a
fiduciary for the other party to the contract.
(3)
Either party may with the consent of the other sue for the benefit of whom it
may concern. [1961 c.726 §72.7220]
72.7230 Proof of market price: time and
place. (1) If an action based on anticipatory
repudiation comes to trial before the time for performance with respect to some
or all of the goods, any damages based on market price shall be determined
according to the price of such goods prevailing at the time when the aggrieved
party learned of the repudiation.
(2)
If evidence of a price prevailing at the times or places described in this
chapter is not readily available the price prevailing within any reasonable
time before or after the time described or at any other place which in
commercial judgment or under usage of trade would serve as a reasonable
substitute for the one described may be used, making any proper allowance for
the cost of transporting the goods to or from such other place.
(3)
Evidence of a relevant price prevailing at a time or place other than the one
described in this chapter offered by one party is not admissible unless and
until the party has given the other party such notice as the court finds sufficient
to prevent unfair surprise. [1961 c.726 §72.7230]
72.7240 Admissibility of market
quotations. Whenever the prevailing price or value
of any goods regularly bought and sold in any established commodity market is
in issue, reports in official publications or trade journals or in newspapers
or periodicals of general circulation published as the reports of such market
shall be admissible in evidence. The circumstances of the preparation of such a
report may be shown to affect its weight but not its admissibility. [1961 c.726
§72.7240]
72.7250 Statute of limitations in
contracts for sale. (1) An action for breach of any
contract for sale must be commenced within four years after the cause of action
has accrued. By the original agreement the parties may reduce the period of
limitation to not less than one year but may not extend it.
(2)
A cause of action accrues when the breach occurs, regardless of the aggrieved
party’s lack of knowledge of the breach. A breach of warranty occurs when
tender of delivery is made, except that where a warranty explicitly extends to
future performance of the goods and discovery of the breach must await the time
of such performance the cause of action accrues when the breach is or should
have been discovered.
(3)
Where an action commenced within the time limited by subsection (1) of this
section is so terminated as to leave available a remedy by another action for
the same breach such other action may be commenced after the expiration of the
time limited and within six months after the termination of the first action
unless the termination resulted from voluntary discontinuance or from dismissal
for failure or neglect to prosecute.
(4)
This section does not alter the law on tolling of the statute of limitations
nor does it apply to causes of action which have accrued before the Uniform
Commercial Code becomes effective. [1961 c.726 §72.7250]
SALE OF CONSUMER GOODS
72.8010 Definitions for ORS 72.8010 to
72.8200. As used in ORS 72.8010 to 72.8200,
unless the context requires otherwise:
(1)
“Consumer good” means a new consumer good as defined in ORS 79.0102 and
includes, but is not limited to, a new motor vehicle, new manufactured
dwelling, new modular home, new machine, new appliance or new like product used
or bought for use primarily for personal family or household purposes. However,
“consumer good” does not include a soft good or a consumable.
(2)
“Buyer” or “retail buyer” means any person who buys a consumer good from a person engaged in the business of manufacturing,
distributing or selling consumer goods at retail.
(3)
“Manufacturer” means any person who manufactures, assembles or produces
consumer goods.
(4)
“Distributor” means any person who stands between the manufacturer and the
retail seller in purchases, consignments or contracts for sale of consumer
goods.
(5)
“Retail seller,” “seller” or “retailer” means a person who engages in the
business of selling consumer goods to retail buyers.
(6)
“Soft good” means any pliable product substantially composed of woven material,
natural or synthetic yarn or fiber, textile or similar product.
(7)
“Consumable” means any product which is intended for consumption by
individuals, or use by individuals for purposes of personal care or in the
performance of services ordinarily rendered within the household, and which
usually is consumed or expended in the course of such consumption or use.
(8)
“Implied warranty of merchantability” of a consumer good or “implied warranty
that a consumer good is merchantable” is a warranty that the consumer good:
(a)
Passes without objection in the trade under the contract description;
(b)
Is fit for the ordinary purposes for which the good is used;
(c)
Is adequately contained, packaged and labeled; and
(d)
Conforms to the promises or affirmations of fact made on the container or
label.
(9)
“Implied warranty of fitness” means that when the retailer, distributor or
manufacturer has reason to know any particular purpose for which the consumer
good is required, and further, that the buyer is relying on the skill and
judgment of the seller to select and furnish a suitable good, then there is an
implied warranty that the good shall be fit for such purpose. [1973 c.413 §1;
2001 c.445 §140]
Note:
72.8010 to 72.8200 were enacted into law by the Legislative Assembly but were
not added to or made a part of ORS chapter 72 or any series therein by
legislative action. See Preface to Oregon Revised Statutes for further
explanation.
72.8020 Manufacturer’s implied warranty of
merchantability. Except if the manufacturer
disclaims the warranty in the manner prescribed by ORS 72.8010 to 72.8200, the
manufacturer of a consumer good to be sold at retail in this state gives, on
sale or consignment for sale, the manufacturer’s implied warranty of
merchantability. [1973 c.413 §3]
Note: See
note under 72.8010.
72.8030 Manufacturer’s implied warranty of
fitness. Except if the manufacturer disclaims
the warranty in the manner prescribed by ORS 72.8010 to 72.8200, on every sale
or consignment for sale of a consumer good sold at
retail in this state by a manufacturer who has reason to know at the time of
the retail sale that the good is required for a particular purpose and that the
buyer relies on the manufacturer’s skill or judgment to select or furnish a
suitable good the manufacturer gives the manufacturer’s implied warranty of
fitness. [1973 c.413 §4]
Note: See
note under 72.8010.
72.8040 Retailer’s or distributor’s implied
warranty of fitness. Except if the retailer or
distributor disclaims the warranty in the manner prescribed by ORS 72.8010 to
72.8200, on every sale or consignment for sale of a consumer good sold at retail in this state by a retail dealer or
distributor who has reason to know at the time of the retail sale that the good
is required for a particular purpose, and that the buyer relies on the retailer’s
or distributor’s skill or judgment to select or furnish a suitable good, the
retailer or distributor gives the retailer’s or distributor’s implied warranty
of fitness for that purpose. [1973 c.413 §5]
Note: See
note under 72.8010.
72.8050 Disclaimer of implied warranty of
merchantability or implied warranty of fitness; manner and effect.
(1) Except with respect to sale of a consumer good by means of a mail-order
catalog, on sale of a consumer good on an “as is” or “with all faults” basis
effective disclaimer of the implied warranty of merchantability or the implied
warranty of fitness requires that a conspicuous writing attached to the
consumer good clearly informs the buyer before sale in simple and concise
language that:
(a)
The good is being sold on an “as is” or “with all faults” basis;
(b)
The entire risk as to the quality and performance of the good is with the
buyer; and
(c)
If the good proves defective after purchase, the buyer and not the
manufacturer, distributor or retailer assumes the entire cost of all necessary
servicing or repair.
(2)
On sale of a consumer good by means of a mail-order catalog effective
disclaimer of the implied warranty of merchantability or the implied warranty
of fitness requires that the catalog offering the good contain, with respect to
each item or good so offered, the conspicuous writing and information otherwise
prescribed by subsection (1) of this section.
(3)
A buyer of a consumer good on an “as is” or “with all faults” basis under
effective disclaimer of the implied warranty of merchantability or the implied
warranty of fitness waives the implied warranty so effectively disclaimed. [1973
c.413 §6]
Note: See
note under 72.8010.
72.8060 Express warranty.
(1) A written statement arising out of a sale to the consumer of a consumer
good pursuant to which statement the manufacturer, distributor or retailer
undertakes to preserve or maintain the utility or performance of the consumer
good or provide compensation if there is a failure in utility or performance of
the consumer good is an express warranty.
(2)
A retailer, distributor or manufacturer expressly warrants that the whole of
goods sold conforms to any sample or model of the goods sold.
(3)
The creation of an express warranty does not require use of formal words such
as “warrant” or “guarantee” and does not require a specific intention to make a
warranty.
(4)
Mere affirmation of the value of goods or a statement purporting to be merely
an opinion or commendation of goods does not create a warranty.
(5)
Statements or representations such as expressions of general policy concerning
customer satisfaction which are not subject to any limitation do not create an
express warranty. [1973 c.413 §2]
Note: See
note under 72.8010.
72.8070 Right to make express warranty;
effect of express warranty upon disclaimer; duration of implied warranty of
merchantability or implied warranty of fitness.
(1) Nothing in ORS 72.8010 to 72.8200 affects the right of a manufacturer,
distributor or retailer to make an express warranty with respect to a consumer
good. Effective disclaimer of the implied warranty of merchantability or the
implied warranty of fitness by a manufacturer, distributor or retailer making
an express warranty with respect to a consumer good requires compliance with
ORS 72.8050.
(2)
When with respect to sale of a consumer good to a
retail buyer no express warranty is made or the duration of an express warranty
is not stated, the implied warranty of merchantability or, if applicable, the
implied warranty of fitness endures:
(a)
Except if the good is a motor vehicle, for one year after the sale; or
(b)
If the good is a motor vehicle, until expiration of one year after the sale or
until 12,000 miles of use, whichever first occurs.
(3)
When with respect to sale of a consumer good to a
retail buyer an express warranty of a stated duration is made, the implied
warranty of merchantability or, if applicable, the implied warranty of fitness
endures for not less than 60 days after the sale and for the duration of the
express warranty or the duration prescribed for the good under subsection (2)
of this section, whichever first occurs. [1973 c.413 §7]
Note: See
note under 72.8010.
72.8090 Form of express warranty;
designation of service and repair facilities. (1)
Each manufacturer, distributor or retailer who makes an express warranty with
respect to a consumer good shall set the warranty forth fully in readily
understood language and shall clearly identify the party making the warranty.
(2)
Each manufacturer, distributor or retailer who makes an express warranty and
maintains a service and repair facility within this state pursuant to ORS
72.8100 shall:
(a)
At the time of sale provide the buyer with the name and address of all such
service and repair facilities;
(b)
At the time of sale provide the buyer with the name, address and telephone
number of a service and repair facility central directory within this state, or
the toll-free telephone number of a service and repair facility central
directory outside this state. It shall be the duty of the central directory,
upon inquiry, to provide the name and address of the authorized service and
repair facility nearest the buyer; or
(c)
Maintain at the premises of the retail seller a current listing of authorized
service and repair facilities within this state or retail sellers within this
state to whom the consumer good may be returned for service and repair. [1973
c.413 §9]
Note: See
note under 72.8010.
72.8100 Manufacturer’s service and repair;
facilities within state; nonconforming good; inability to service; buyer’s
delivery or notice of nonconforming good. (1)
Each manufacturer of a consumer good sold in this
state and for which the manufacturer has made an express warranty shall:
(a)
Maintain or cause to be maintained in this state sufficient service and repair
facility to carry out the terms of such a warranty; or
(b)
Be subject to the provisions of ORS 72.8130.
(2)
Except if the buyer agrees in writing to the contrary, the manufacturer shall
cause service or repair of the consumer good to be commenced as soon as
possible, subject to reasonable delay caused by conditions beyond the control
of the manufacturer or the manufacturer’s representative.
(3)
If the size, weight, method of attachment, method of installation, and nature
of nonconformity reasonably permit such delivery, the buyer shall deliver a
nonconforming good to the manufacturer’s nearest available service and repair
facility within this state. If the size, weight, method of attachment, method
of installation and nature of the nonconformity do not reasonably permit such
delivery, written notice of nonconformity by the buyer to the manufacturer or
to the manufacturer’s nearest service and repair facility is equivalent to
return of the good for the purposes of this section. Upon receipt of the notice
of nonconformity the manufacturer shall service or repair the good at the buyer’s
residence, pick up the good for service and repair, or, at the manufacturer’s
expense, transport, service, repair and return the good to the buyer.
(4)
If the manufacturer is unable to service or repair the good in compliance with
each applicable warranty, the manufacturer shall either replace the good or
reimburse the buyer in an amount equal to the purchase price paid by the buyer
less a reasonable charge for beneficial use by the buyer and damage, if any, to
the good. In the event of replacement of the good or refunding of the purchase
price, the buyer shall return the defective good to the warrantor free and
clear of liens and encumbrances. [1973 c.413 §8]
Note: See
note under 72.8010.
72.8110 Retailer’s service and repair of
nonconforming good in absence of manufacturer’s service and repair facilities
within state; buyer’s delivery or notice of nonconforming good.
(1) If the manufacturer who makes an express warranty does not provide service
and repair facilities within this state pursuant to ORS 72.8100, the buyer may
return the nonconforming good to the retail seller for replacement or for
service and repair in accordance with the terms and conditions of the express
warranty. Such replacement, service or repair shall be at the option of the
retail seller. If the retail seller does not replace the defective good with a
conforming good or does not effect the service or
repair of the good in accordance with the terms and conditions of the warranty,
the retail seller shall reimburse the buyer in an amount equal to the purchase
price paid, less a reasonable charge for beneficial use by the buyer and
damage, if any, to the good. In the event of replacement of the good or
refunding of the purchase price, the buyer shall return the defective good to
the warrantor free and clear of liens and encumbrances.
(2)
If the size, weight, method of attachment, method of installation and nature of
nonconformity do not reasonably permit the buyer to return the nonconforming
good, written notice of nonconformity from the buyer to the retail seller
constitutes return of the good for the purposes of subsection (1) of this
section. Upon receipt of the notice of nonconformity the retailer shall service
or repair the good at the buyer’s residence, pick up the good for service or
repair, or at the retail seller’s expense arrange for transporting the good to
the retail seller’s place of business. Under ORS 72.8130 the retail seller may
recover all costs incurred by the retail seller for transporting the
nonconforming good from the buyer’s residence to the retail seller’s place of
business and thence to the buyer’s residence. [1973 c.413 §10]
Note: See
note under 72.8010.
72.8120 Time for commencement of service
and repair; effect of delay; tender of conforming goods.
Where an option is exercised in favor of service and repair under ORS 72.8110,
said service and repair must be commenced within a reasonable time, unless the
buyer agrees in writing to the contrary. Delay caused by conditions beyond the
control of the retail seller’s representative shall serve to extend the time
for repair. Where such a delay arises, conforming goods shall be tendered as
soon as possible following termination of the condition giving use to the
delay. [1973 c.413 §10a]
Note: See
note under 72.8010.
72.8130 Liability to retailer of
manufacturer not maintaining service and repair facility within state.
Each manufacturer who, with respect to a consumer good
sold within this state, makes an express warranty but does not provide a
service or repair facility within this state is liable to the retail seller who
incurs obligations in giving effect to the express warranty:
(1)
In the event of replacement, in an amount equal to the cost to the retail
seller of the replaced good, and cost of transporting the good, if such costs
are incurred, plus a reasonable handling charge.
(2)
In the event of service and repair, in an amount equal to that which would be
received by the retail seller for like service rendered to a retail consumer
who is not entitled to warranty protection, including actual and reasonable
costs of the service and repair and the costs of transporting the good, if such
costs are incurred, plus a reasonable profit.
(3)
In the event of reimbursement under ORS 72.8110 (1), in an amount equal to that
reimbursed to the buyer plus a reasonable handling or service charge. [1973
c.413 §11]
Note: See
note under 72.8010.
72.8140 Unauthorized or unreasonable use
after sale. ORS 72.8010 to 72.8200 do not apply to
any defect or nonconformity in a consumer good caused by the unauthorized or
unreasonable use of the good after sale. [1973 c.413 §12]
Note: See
note under 72.8010.
72.8150 Service contract in addition to or
in lieu of express warranty. Nothing in
ORS 72.8010 to 72.8200 prevents the sale of a service contract to the buyer in
addition to or in lieu of an express warranty if the contract duly and
conspicuously discloses in simple and readily understood language the term,
duration and conditions of the contract. [1973 c.413 §13]
Note: See
note under 72.8010.
72.8160 Express warranty in addition to
implied warranties. Nothing in ORS 72.8010 to
72.8200 prevents a person from making an express warranty that is in addition
to implied warranties prescribed by ORS 72.8010 to 72.8200. [1973 c.413 §14]
Note: See
note under 72.8010.
72.8170 Authority of manufacturer who
makes express warranty to suggest methods of effectuating service and repair.
ORS 72.8010 to 72.8200 do not prohibit a manufacturer who makes an express
warranty from suggesting methods of effectuating service and repair, in
accordance with the terms and conditions of the express warranty, other than
those required by ORS 72.8010 to 72.8200. [1973 c.413 §15]
Note: See
note under 72.8010.
72.8180 Buyer’s waiver of ORS 72.8010 to
72.8200. Waiver of the provisions of ORS 72.8010
to 72.8200 by a buyer of consumer goods is void except where such a waiver is
expressly allowed by ORS 72.8010 to 72.8200. [1973 c.413 §16]
Note: See
note under 72.8010.
72.8190 Status of remedies under ORS
72.8010 to 72.8200; effect of unconstitutionality.
The remedies provided by ORS 72.8010 to 72.8200 are cumulative and shall not be
construed as restricting any remedy otherwise available including the remedies
provided by ORS chapter 72. If any provision of ORS 72.8010 to 72.8200 or
application thereof to any person or circumstance is held unconstitutional,
such invalidity shall not affect other provisions or applications of ORS
72.8010 to 72.8200 which can be given effect without the invalid provision or
application, and to this end the provisions of ORS 72.8010 to 72.8200 are
severable. [1973 c.413 §17]
Note: See
note under 72.8010.
72.8200 Operative dates.
ORS 72.8010 to 72.8200 apply to a consumer good sold
on or after January 1, 1974. However, ORS 72.8020, 72.8030, 72.8040 and 72.8090
only apply to a consumer good manufactured on or
after January 1, 1974. [1973 c.413 §18]
Note: See
note under 72.8010.
_______________