First Principles of Business Law
Remedies for breach of contract

4. Termination of performance

4.6. Hidden defects

 

 

 

A is a supplier of industrial equipment. He agrees to supply B with a packaging machine. The machine is delivered to B, and B installs it in his factory. After a month of use the machine begins to malfunction and B then discovers that some essential internal parts of the machine have been made from flawed metal and have begun to break. Without a complete rebuild the machine is useless. B wants to reject the machine on grounds of the defect.

(a) Since B has already accepted delivery of the machine, installed it in his factory and used it for a month it is too late for him to reject the machine.

(b) In the circumstances, it is not too late for B to reject the machine, even though he has accepted delivery, installed the machine in his factory and used it for a month.

 

 

 

 

 

 

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