Reference no: EM131378857

Any contract that involves clothing, even avant-garde clothing, is covered by the Uniform Commercial Code (UCC). Keep in mind, as you read this case that the commissioners who wrote the UCC did their best to protect all the parties involved in a contract, even those who might not deserve that protection.

In this case, the plaintiff is a Los Angeles clothing manufacturer and the defendant is a retailer doing business in Westport, Connecticut, as a clothing store named The Rage. The manufacturer received an order from The Rage for a shipment of clothing that amounted to $2,216.00. The clothing was packaged carefully and then turned over to a reputable and dependable shipper named the Denver-Chicago Shipping Company (Denver). Denver gave a bill of lading to the manufacturer and the manufacturer sent along four separate invoices to The Rage. The invoices stated explicitly that the shipment was "F.O.B. Los Angeles," that the shipper was Denver-Chicago, and that the buyer bore the risk of loss.

Moreover, the bill of lading stated quite clearly that all shipping charges would be paid by The Rage. At some point along the way between LA and Westport, exactly where is never made clear, Denver handed the shipment off to another trucking firm, this one named the Old Colony Transportation Company of South Dartmouth, Massachusetts. When the Old Colony truck arrived at The Rage, the driver refused to deliver the goods inside of the store, preferring, instead, to deliver them outside the premises.

When the store manager refused to accept the eight cartons of clothing unless they ended up inside the store, the trucker drove off, still in possession of the shipment. The clothing was never seen again. The owner of The Rage sent an immediate letter of protest to the manufacturer, which filed a claim against Denver, which Denver refused to honor. Meanwhile, back in Connecticut, the owner of The Rage continued to demand that the missing shipment be delivered inside the store.

Yet, whenever the manufacturer tried to contact the owner, he was unavailable. When the manufacturer finally sued, the owner of The Rage argued that he could not possibly be liable for goods he never received. Instead, he claims that the manufacturer is responsible for the loss of the shipment because he chose an unreliable shipper who apparently ran off with the goods.

In turn, the manufacturer argues that, since the risk of loss passed to the retailer when the shipment was delivered to the trucker, and since the retailer refused to accept a shipment that was quite literally on his doorstep, he must pay for the eight cartons of clothing whether he actually received them or not.

As you read the chapter, see if you can solve the Case if the Disappearing Delivery or, as they say in Massachusetts, the Mystery of the Missing Merchandise. (See Ninth Street East, Ltd. v. Harrison , 259 A.2d 772, 5 Conn.Cir.Ct. 597 (Connecticut Circuit Court, First Circuit).)

Opening Case Questions

1. In the case of Ninth Street East, Ltd. v. Harrison , what does the notation "F.O.B. Los Angeles" mean?

2. At what point did the risk of loss pass to the buyer? Explain.

3. The bill of lading in this case noted that the shipment was to be "collect." How does this notation figure into the passage of risk? Explain.

4. Did the truck driver's refusal to deliver the cartons inside the store amount to a refusal to tender performance? Why or why not?