Oregon Statute | Act | Code |Title 08 Commercial Transactions| US Code - US Statute

This chapter may be cited as Uniform
Commercial Code–Sales. [1961 c.726 §72.1010]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] (1) In this chapter
unless the context otherwise requires:

(a) "Buyer" means a person who buys or contracts to buy goods.

(b) "Good faith" in the case of a merchant means honesty in fact
and the observance of reasonable commercial standards of fair dealing in
the trade.

(c) "Livestock" means equines, cattle, sheep, goats, llamas,
alpacas and swine.

(d) "Receipt" of goods means taking physical possession of them.

(e) "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) 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](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 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](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](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] (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 (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]
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 dealing or usage of trade as provided in ORS
71.2050 or by course of performance as provided in ORS 72.2080; 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] 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] (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] 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] (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] (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] (1) Where
the contract for sale involves repeated occasions for performance by
either party with knowledge of the nature of the performance and
opportunity for objection to it by the other, any course of performance
accepted or acquiesced in without objection shall be relevant to
determine the meaning of the agreement.

(2) The express terms of the agreement and any such course of
performance, as well as any course of dealing and usage of trade, shall
be construed whenever reasonable as consistent with each other; but when
such construction is unreasonable, express terms shall control course of
performance and course of performance shall control both course of
dealing and usage of trade.

(3) Subject to the provisions of ORS 72.2090 on modification and
waiver, such course of performance shall be relevant to show a waiver or
modification of any term inconsistent with such course of performance.
[1961 c.726 §72.2080] (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] (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]Note: For transition provisions regarding secured transactions, see
notes under 79.0628.GENERAL OBLIGATION AND CONSTRUCTION OF CONTRACT 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] (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] 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] (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] (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] (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] 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] 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]
(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]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; and

(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; and

(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 at
the time and place at which the buyer is to receive the documents
regardless of where the goods are to be received; 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] (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](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](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] (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] 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](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]
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]
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] (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] 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]: "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]" (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](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 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] 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]" (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]
(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]Note: For transition provisions regarding secured transactions, see
notes under 79.0628.
(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] (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 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] (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](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(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](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] (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 written direction to the bailee to deliver is sufficient tender unless
the buyer seasonably objects, and 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 the documents constitutes nonacceptance
or rejection. [1961 c.726 §72.5030] 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] (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 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. [1961 c.726 §72.5050] (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 on its face. [1961 c.726 §72.5060] (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 they 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]
(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] (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 receipt by the buyer of a negotiable document of title
covering the goods; or

(b) On acknowledgment by the bailee of the buyer's right to
possession of the goods; or

(c) After the buyer's receipt of a nonnegotiable document of title
or other written direction to deliver, 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] (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] (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] (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] (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]
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] 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 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] (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]
(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]
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]
(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 on the face of the
documents. [1961 c.726 §72.6050] (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](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] (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] (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] 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] (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] (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] 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] (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] 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] (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
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] (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] 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](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] (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; or

(b) Acknowledgment to the buyer by any bailee of the goods except a
carrier that the bailee holds the goods for the buyer; or

(c) Such acknowledgment to the buyer by a carrier by reshipment or
as warehouseman; 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
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] (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]" (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] (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] (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] 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](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] (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] (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] (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] (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] (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]Note: For transition provisions regarding secured transactions, see
notes under 79.0628. 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] (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] (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]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] 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] 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] (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] 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] (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 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. 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. 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.
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.(1) Except with respect
to sale of a consumer good by means of a mail-order catalogue, 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 catalogue
effective disclaimer of the implied warranty of merchantability or the
implied warranty of fitness requires that the catalogue 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. (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.(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.(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.(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.(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.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.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.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.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. 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.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. 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.

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