Cengage Advantage Books: Business Law 9th Edition by Arnold Goldman ,William Sigismond

Exercise 17

On November 15, the Bon Ton Corporation entered into a contract to purchase 100 leather chairs from Rudnick Manufacturing Company. Both companies are in the same city. Bon Ton prepaid 50 percent of the purchase price but then became insolvent on November 21. Rudnick learned of this insolvency on November 22 and on that same day made a formal demand on Bon Ton to return the chairs. Can the Rudnick Company recover the chairs, even though they had already been delivered to Bon Ton?