Question

Seller, a Chicago business, sent a shipment of tractor parts to Buyer, a Detroit business, under a contract that read: "F.O.B.Chicago, Illinois." The parts were not those specified in the contract and Buyer rejected them. A few hours after Buyer notified Seller of the rejection, the parts were destroyed in a fire at Buyer's place of business. Which of the following best states the rights and duties of Buyer and Seller in this situation?a. Buyer has the risk of loss because this was a shipment contract.b. Buyer rightfully rejected the tender, but risk of loss did not pass to Seller again until Seller regained physical possession of the goods.c. Seller has the risk of loss because this was a destination contract.d. Seller has the risk of loss because the tender was non-conforming, but only to the extent that Buyer's insurance does not cover the loss.

Answer 1

D. Seller has the risk of loss because the tender was non-conforming, but only to the extent that Buyer's insurance does not cover the loss

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