[Smeared cupcakes] Kai orders forty decorated cupcakes from Liu's bakery next door to be sold in his restaurant. During delivery, Lui trips and the box tips over. When Kai opens the box to inspect the cupcakes, the frosted decorations on the cupcakes are smeared.
-Lui tells Kai the cupcakes can still be sold. Must Kai accept the cupcakes?
A) Yes, because they are still sellable and he must pay the price under the contract.
B) Yes, his only option is to accept the cupcakes and ask for a price reduction.
C) No, but Kai must provide Lui with time to cure.
D) No, Kai can treat the contract as void or Kai can ask Lui for a price reduction and then accept the damaged goods.
E) No, Kai's only option is to treat the contract as void.

Question

Quizplus · Accepted Answer

Kai has the option to treat the contract as void due to the goods (cupcakes) not being delivered in the agreed-upon condition, or he can negotiate a price reduction with Lui for the damaged goods and then accept them. This flexibility is often present in contracts for the sale of goods where the goods delivered are not as per the contract specifications.

[Smeared Cupcakes] Kai Orders Forty Decorated Cupcakes from Liu's Bakery