Also known as: rejections after arrival · reject after arrival · post-arrival rejection
Written by attorneys · grounded in primary & secondary sources — see below
A circumstance in which a buyer rejects nonconforming goods after they reach the destination point. Market price for damages is then measured at the place of arrival rather than the place for tender.
Prairie Grain Co-op shipped soybeans to Heartland Foods under an FOB river elevator term. The beans arrived at Heartland's processing plant where inspection revealed they were off-grade. Heartland rejected the shipment on the spot. Damages are calculated using the market price at the plant on the rejection date.
Harbor Foundation shipped steel beams to Grove Construct's downtown site. The beams arrived instead at a rented staging yard outside the city. Grove's manager inspected them there, found them nonconforming, and rejected the shipment in writing the same day. Market price for damages is fixed at the staging yard on the date of rejection.
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Rejection after arrival changes the location when the buyer inspects and rejects the goods only after they reach the destination. The rule then requires market price at the place of arrival on the date of rejection rather than at the original tender point.
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An FOB term fixes the point where risk of loss passes but does not control the market-price location once rejection occurs after arrival. The Code directs use of the arrival market regardless of the delivery term.
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Revocation of acceptance after arrival triggers the same place-of-arrival rule that applies to rejection. Market price is measured at the arrival location on the date the buyer learns of the nonconformity and revokes.
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Market price is determined on the date the buyer learns of the breach through inspection and rejection at the place of arrival. That date controls even if the contract designated an earlier tender point.
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