Capital Dodge Sales v Northern Concrete Pipe
Michigan Ct. App [1983]
Author:- Sam Biers

Relevant Facts: An officer of Df, William, called at Pl’s business to solicit the sale of a truck w/ a snowplow attached.   Fuller took him for a test drive, but when they returned the engine overheated.  Fuller stated the snowplow’s position was the cause.  William was willing to buy it if this were true, Fuller affirmed.  William gave Fuller a check for the full payment w/ instructions that his employees would pick it up the next day.  When the employees arrived Fuller personally showed them how to position the blade.  When they arrived back w/ the truck it overheated.  Fuller’s service tech advised rechecking the position, refilling the radiator, and test driving again.  It overheated, Df was told to bring the truck in for service.  He did so and it again overheated.  The Pl replaced the radiator cap, and after the Df picked up the truck it again overheated.  Payment was stopped on the check, and instructions that the Pl should have the truck.  A wrecker picked it up for the Pl.

Legal Issue(s): Whether the Df’s actions can be construed, under the UCC, as signifying, after a reasonable opportunity to inspect, that the truck conformed or that the Df would retain the truck in spite of its nonconformity.?

Court’s Holding: No and No.

Procedure: Tr Ct ruled in favor of seller and manufacturer(3rd); Circuit Ct Affirmed. Ct of App  Reversed and remanded.

Law or Rule(s): Acceptance of goods occurs when the buyer after reasonable opportunity to inspect the goods signifies to the seller that the goods are conforming or that he will take or retain them in spite of their non conformity; or fails to make an effective rejection but such acceptance does not occur until the buyer has had a reasonable opportunity to inspect them.

Court Rationale: The language of the UCC clearly contemplates an act of the buyer beyond taking delivery or possession of the goods.  Possession during the time necessary for the “reasonable opportunity” to inspect is contemplated prior to acceptance. The code allows rejection of good for non conformance “w/i a reasonable time after delivery.” Thus while transfer of possession or title may be acts bearing on acceptance, they are not in themselves determinative thereof.  The buyer is dependant on the seller’s expertise that something more than a mere visual inspection is appropriate before the buyer can be held to have accepted the machine.  A “reasonable time to inspect” under the UCC must allow an opportunity to put the product to its intended use, or for testing to verify its capability to perform as intended.  Under the code the buyer may reject goods which “fail in any respect to conform to the K,” which creates a “Perfect Tender Rule.”  In this case there was no acceptance Nothing the Df did can be construed under the UCC, as signifying, after a reasonable opportunity to inspect, that the truck conformed or that the Df would retain the truck in spite of its nonconformity.  Df had the absolute right to reject the truck for non conformity w/i a reasonable time, and notify the seller.  Df did so.

Plaintiff’s Argument: Df by physcial possession accepted delivery of the goods.

Defendant’s Argument: After repeated inspections by Pl, the goods were nonconforming.