This document provides an overview of Chapter 22 from the 6th edition of the textbook "Business Law" which covers domestic and global aspects of sales contract performance, breach, and remedies. It includes learning objectives, an introduction discussing consequences of breaching a sales contract, summaries of buyer and seller duties/rights/remedies under the Uniform Commercial Code, and global sales law aspects of performance and remedies. Case studies are presented and analyzed relating to adequate assurances, determining damages, and a seller's right to stop goods in transit.

1. Business Law, Sixth Edition
© 2019 BVT Publishing. All rights reserved.
S-1
Chapter 22:
Sales Contracts:
Domestic &
Global Aspects of
Performance,
Breach, & Remedies

2. Business Law, Sixth Edition
© 2019 BVT Publishing. All rights reserved.
S-2
Learning Objectives
• Describe the remedies for breach
available under the Uniform Commercial
Code.
• Explain the buyer’s duties, rights, and
remedies.
• Recognize the seller’s duties, rights, and
remedies.
• Understand performance and remedial
aspects of global sales law.

3. Business Law, Sixth Edition
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22.0 In the News
What Can Happen if You Breach a Sales
Contract?
http://bvtlab.com/Z59Jh
Once you and your customer sign a sales contract
and exchange consideration, or money, it is a
legally binding document. The consequences can
be severe if you do not carry out the promises it
contains.
• What constitutes a breach of sales contract?
• What are the available remedies?

4. Business Law, Sixth Edition
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22.1a Checklist for Code Remedies
(Slide 1 of 3)

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22.1a Checklist for Code Remedies
(Slide 2 of 3)
• Code assumes seller will resell goods
and sue buyer for difference between
resale price and original contract
price.
• Code assumes buyer will cover by
buying substitute goods and sue
seller for any difference between
cover price and original contract price.

6. Business Law, Sixth Edition
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22.1a Checklist for Code Remedies
(Slide 3 of 3)
Four possible situations in which either
party may be in breach of contract:
1. Anticipatory repudiation by buyer or
seller
2. Failure of performance (buyer fails to
pay or seller fails to deliver)
3. Rightful or wrongful rejection by buyer
4. Rightful or wrongful revocation of
acceptance by buyer

7. Business Law, Sixth Edition
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22.1b Adequate Assurances
• Code imposes an obligation on each
party that the other’s expectation of
receiving due performances will not be
impaired.
• Parties can demand in writing
convincing proof of performance.
• No assurance within 30 days, the
contract treated as repudiated.

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22.1b Critical Thinking
CASE: Al-Misehal
A Saudi Arabian company moved for
summary judgment alleging the failure of a
subcontractor to give adequate assurances
of performance determining an anticipatory
repudiation of a contract under the UCC.
• Was Al-Misehal’s cancellation in response to
TAG’s repudiation of the contract? Why?
• Why did the court deny Al-Misehal’s motion
for summary judgment as to TAG’s
repudiation of the contract?

9. Business Law, Sixth Edition
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22.2a Summary of Buyer’s
Duties, Rights, and Remedies
• Right to inspect
• Right to reject
• Revoke the acceptance
• Right to purchase cover
• Right to recover the actual goods
described in the sales contract

10. Business Law, Sixth Edition
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22.2g Critical Thinking
CASE: Mayberry
The court addresses the issue of the
appropriate measure of damages where
goods are accepted but there is a breach of
warranty.
• What was the appropriate method for
determining damages in this case?
• Did the consumer in this case receive a
windfall in the amount of damages awarded?
Is this appropriate?

11. Business Law, Sixth Edition
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22.3a Summary of Seller’s
Duties, Rights, and Remedies
• Right to cure.
• Right to cancel the contract if buyer’s breach is
material.
• Right to withhold delivery or stop delivery.
• Right to resell the goods and recover damages.
• Right to recover damages for the buyer’s failure
to accept the goods.
• Right to file suit to recover the price of the
goods.

12. Business Law, Sixth Edition
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22.3b Critical Thinking
Case: Trico
Pig iron was in transit, but the court found
that the debtor did not receive the pig iron.
As a result, the supplier of the pig iron was
entitled to possession and the goods were
not within the possession of the debtor.
• Why did the court rule in favor of Cargill?
• What would have happened if Cargill were
unable to stop the goods in transit?

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22.4 Global Sales Law (Slide 1 of 2)
Performance Aspects
• Under the CISG, buyer is required to inspect
and reject nonconforming goods.
• Notice of nonconformity must be given within
two years after discovery.
• Recovery* is based on either:
- Difference between contract price and substitute
performance.
- Difference between market and contract price.
*Including consequential damages

14. Business Law, Sixth Edition
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22.4 Global Sales Law (Slide 2 of 2)
Remedial Aspects
• Non-breaching party is entitled to void the
contract upon “fundamental breach” by the
other party.
• Buyer may claim damages based on the
sum equal to loss, including lost profit.
• Seller’s damages similarly mirror Code
provisions.