The Perfect Tender Rule

Understanding the Perfect Tender Rule Under NY UCC

In New York, buyers have the right to expect that the goods delivered will exactly meet the terms of the contract. This expectation is embodied in the Perfect Tender Rule under the UCC.

What is the Perfect Tender Rule?

• UCC §2-601:

  States that if the goods or the tender of delivery fail in any respect to conform to the contract, the buyer may:

• Reject the entire shipment,

  
  

• Accept the entire shipment,

  
  

• Accept any commercial units and reject the rest.

Implications for Buyers:

• High Standards:

  Buyers are not obligated to accept goods that are even slightly non-conforming.

• Flexibility:

  Buyers can choose to accept part of the shipment if only some goods are non-conforming.

Exceptions to the Rule:

1. Cure by the Seller (UCC §2-508):

   
   

   • Opportunity to Cure: If the time for performance has not yet expired, the seller may notify the buyer of their intention to cure and deliver conforming goods.

     
     

2. Installment Contracts (UCC §2-612):

   
   

   • Substantial Impairment Standard: In installment contracts, the buyer may only reject an installment if the non-conformity substantially impairs its value.

     
     

3. Agreement Between Parties:

   
   

   • Contractual Limitations: The parties may agree to limit the buyer's right to reject non-conforming goods.

Implications for Sellers:

• Strict Compliance:

  Sellers must ensure that goods and delivery terms strictly adhere to the contract.

  
  

• Quality Control:

  Implement robust quality assurance processes to prevent non-conformities.

Key Takeaways:

• Buyers have the right to receive exactly what was agreed upon.

• Sellers should strive for perfection in fulfilling contractual obligations.

• Understanding the Perfect Tender Rule helps both parties manage expectations and obligations.

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Disclaimer:

This article is for informational purposes only and does not constitute legal advice. Although I am an attorney, I am not your attorney, and reading this article does not create an attorney-client relationship. For advice pertaining to your specific situation, please consult a qualified attorney licensed in your area.