Business Law and the Regulation of Business 11th Edition by Richard Mann, Barry Roberts

Exercise 5

Regan received a letter from Chase, the material portion of which stated, ''Chase hereby places an order with you for fifty cases of Red Top Tomatoes. Ship them C.O.D.'' As soon as he received the letter, Regan shipped the tomatoes to Chase. While en route, the railroad car carrying the tomatoes was wrecked. When Chase refused to pay for the tomatoes, Regan started an action to recover the purchase price. Chase defended on the ground that because the shipment was C.O.D., neither title to the tomatoes nor risk of loss passed until their delivery to Chase. Who has title? Who has the risk of loss? Explain.