Pine Mills Inc. and Quality Lumber Company enter into a contract for a sale of plywood to be delivered under a destination contract. This contract requires Pine Mills, the seller, to
A) allow the buyer to reject the goods for any reason.
B) deliver the goods to a particular destination.
C) inspect the goods before tendering their delivery.
D) place the goods into the hands of a carrier.

Question

Pine Mills Inc. and Quality Lumber Company enter into a contract for a sale of plywood to be delivered under a destination contract. This contract requires Pine Mills, the seller, to​
A) ​allow the buyer to reject the goods for any reason.
B) ​deliver the goods to a particular destination.
C) ​inspect the goods before tendering their delivery.
D) ​place the goods into the hands of a carrier.

Quizplus · Accepted Answer

A destination contract requires the seller to deliver the goods to a particular destination, which is the primary obligation of the seller. It is different from a shipment contract where the seller's obligation is to place the goods into the hands of a carrier for transportation to the buyer's destination. The buyer may still have the right to reject the goods for certain reasons, but it is not the seller's primary obligation under a destination contract. The seller may or may not need to inspect the goods before delivery, depending on the terms of the contract.