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Proper Tender of Goods Depends on Terms of Contracts
Description Michigan high court held that a manufacturer that only agreed to sell goods did not have an obligation to install or test the goods, so the statute of limitations regarding the sale ran from the time the goods were properly tendered.
Topic Sales
Key Words Statute of Limitations, Tender of Delivery, Warranty
C A S E   S U M M A R Y
Facts Plaintiffs, commercial dairy farmers, contracted to buy a DEC milking machine. Equipment was delivered to local dealer at the end of July, was installed at the farm on Sept. 8, and was tested and approved for operation by the Department of Agriculture on Sept. 12. On Sept. 10, four years later, plaintiffs sued DEC for breach of warranty, claiming the equipment was defective and injured their operation. DEC countered that the four-year statute of limitation had expired before suit was filed. Trial court agreed with DEC; court of appeals reversed; DEC appealed.
Decision Reversed. Tender of delivery, for purposes of statute of limitations for breach of sales contract did not occur until installation was complete or seller offered conforming goods. The manufacturer has no contractual obligation to install the system. Rather, its agreement was to sell the machinery to the dealer, who sold the goods to the buyer. Hence, the statute of limitations as to the manufacturer was not tolled by the dealer's failure to install the system more quickly. Tender of delivery is not contingent on inspection or testing by Department of Agriculture unless there is a contractual provision to that effect.
Citation Baker v. DEC Corporation, 580 N.W.2d 894 (Sup. Ct., Mich., 1998)

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