Also known as: nonconforming goods · non conforming goods
Written by attorneys · grounded in primary & secondary sources — see below
Goods shipped in response to an offer to buy that deviate from the order specifications. Such a shipment does not constitute acceptance if the seller seasonably notifies the buyer that it is offered only as an accommodation, or goods that may be made the subject of a contractual limitation of remedies to repair or replacement.
Noreen Nguyen orders Grade A widgets for prompt shipment from Neptune Energy. Neptune Energy ships Grade B widgets instead and immediately notifies Noreen that the shipment is offered only as an accommodation. The non-conforming shipment does not constitute acceptance of her offer, leaving no contract formed and allowing Noreen to treat the offer as lapsed.
Luxe Threads contracts with Aurora Apparel for 200 custom coats bearing its logo. Aurora delivers coats without the logo. The contract limits remedies to repair or replacement of non-conforming goods. Luxe Threads may invoke the limitation clause to demand replacement while retaining a security interest in the delivered coats pending resolution.
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Shipment of non-conforming goods constitutes acceptance unless the seller seasonably notifies the buyer that the shipment is offered only as an accommodation. The notice must occur promptly so the buyer understands the shipment does not bind the parties to a contract.
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The buyer may reject the whole tender, accept the whole, or accept any commercial unit and reject the rest. Rejection of the whole is permitted even if some units conform when the nonconformity prevents the buyer from fulfilling its own commercial obligations.
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Such a clause is enforceable unless circumstances cause the limited remedy to fail of its essential purpose. The buyer then regains access to all remedies provided by the UCC.
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The perfect tender rule allows rejection of goods that fail to conform in any respect, but the seller may cure by delivering conforming goods within the contract time after seasonable notice. Cure prevents the buyer from treating the initial tender as a breach.
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…warranty but over whether Northrop waited more than the “reasonable time” that the Uniform Commercial Code allows the buyer of nonconforming goods to reject them. UCC § 2-602(1). That in fact is how the magistrate judge framed the issue, as we shall see. But the parties continue to treat it as a “warranty” case. Their implicit view is…