Under a shipment contract, the risk of loss passes to the buyer when the seller places conforming goods in the possession of the carrier.

Question

Quizplus · Accepted Answer

This statement correctly reflects the passing of risk in a shipment contract, which is governed by the Uniform Commercial Code (UCC). The UCC establishes that risk of loss passes from the seller to the buyer when the goods are delivered to the carrier, regardless of whether the title has passed or payment has been made. Accordingly, the buyer bears the risk of loss during transportation, unless the parties agree otherwise.

Under a Shipment Contract, the Risk of Loss Passes to the Buyer