Cey Corp.entered into a contract to sell parts to Deck,Ltd.The contract provided that the goods would be shipped "FOB Cey's warehouse." Cey shipped parts different from those specified in the contract.Deck rejected the parts.A few hours after Deck informed Cey that the parts were rejected,they were destroyed by fire in Deck's warehouse.Cey believed that the parts were conforming to the contract.Which of the following statements is correct?
A)Regardless of whether the parts were conforming,Deck will bear the loss because the contract was a shipment contract.
B)If the parts were nonconforming,Deck had the right to reject them,but the risk of loss remained with Deck until Cey took possession of the parts.
C)If the parts were conforming,risk of loss did not pass to Deck until a reasonable period of time after the parts were delivered to Deck.
D)If the parts were nonconforming,Cey will bear the risk of loss,even though the contract was a shipment contract.

Question

Quizplus · Accepted Answer

When a buyer rightfully revokes acceptance of the goods,the risk of loss is on the seller from the beginning,to the extent that it is not covered by the buyer's insurance.

Cey CorpEntered into a Contract to Sell Parts to Deck,Ltd