Question

Sutter purchased a computer from Harp. Harp is not in the business of selling computers. Harp tendered delivery of the computer after receiving payment in full from Sutter. Sutter informed Harp that Sutter was unable to take possession of the computer at that time but would return later that day. Before Sutter returned, the computer was destroyed by a fire. The risk of loss

A. Remained with Harp because title had not yet passed to Sutter.
B. Passed to Sutter upon Harp's tender of delivery.
C. Passed to Sutter at the time the contract was formed and payment was made.
D. Remained with Harp because Sutter had not yet received the computer.

Answer 1

The risk of loss passed to Sutter at the time the contract was formed and payment was made.

Step-by-step explanation:

The correct answer is option C. The risk of loss passed to Sutter at the time the contract was formed and payment was made. In this case, the risk of loss refers to the responsibility for any damage or destruction of the computer. When Sutter made the payment to Harp, the contract was formed and the risk of loss transferred to Sutter. The fact that Sutter was unable to take possession of the computer at that time does not change the transfer of the risk of loss.