For you commercial contract experts out there:
If a contract is completely silent on shipment terms, will the UCC's gap-filling provisions make this a shipment contract or a destination contract? The difference is important, because under the former, title and risk of loss pass to the buyer upon turning over the items to a carrier, whereas under the latter, neither pass until the items are tendered at their destination.
My opinion is that it will default to a shipment contract, but I will save my reasoning for later.

By joel hoffman on Thursday, March 15, 2001 - 06:29 pm:

Hey, Ron. Do you have a current link to the UCC? My version from a Business Law course I took is 18 years old. I could only find a website with a "part" of the UCC on it, last year. Thanks, to anyone, in advance! Happy Sails! Joel

By Eric Ottinger on Friday, March 16, 2001 - 08:45 am:

Joel,

Here is a UCC site.

http://www.findlaw.com/01topics/07contracts/gov_laws.html

Eric

By joel hoffman on Friday, March 16, 2001 - 01:13 pm:

Thanks, Eric! Happy Sails!

By Ron Vogt on Friday, March 16, 2001 - 05:34 pm:

Joel,
Here's the site I use for the UCC.
http://www.law.cornell.edu/ucc/ucc.table.html
There will be a quid pro quo I assume?
Ron

By joel hoffman on Monday, March 19, 2001 - 08:36 am:

Ron, Thanks for the link. I dug out my Business Law book, but answers to your question require some more information about the sale.

When you say "the contract is completely silent on shipping terms", what did you mean? Was shipping part of the price paid by the buyer to the seller?

Are these "existing and identified goods", as opposed to "future goods"?

Was the seller supposed to send the goods to the buyer at the buyer's address?

What are the terms of the sale? Was this C.O.D.?

Any other info available? Happy Sails! Joel

By Ron Vogt on Monday, March 19, 2001 - 12:28 pm:

Joel,
Most of your questions can be answered by the original problem statement: the contract is silent on shipping terms. That means that the address, C.O.D., shipping price, etc., are not in the contract. Remember, the bare minimum required for a contract under the UCC are a subject matter and quantity. Even a price is not required. The UCC has many ways to fill the gaps, which I will not go into here.
Admittedly, such a contract is and should be rare. Nevertheless, it is being used as a hypothetical by a group of professional advisors on an important issue, and I have reason to question their answer. Thus, my request to contracting experts.

By joel on Monday, March 19, 2001 - 01:19 pm:

Ron, my business law textbook goes either way, but the facts of the situation are relevant to which answer applies. Plus I'm not an expert, so will defer to someone else. Good Luck. Happy Sails! Joel

By Anonymous on Tuesday, March 20, 2001 - 11:30 am:

While I too am not an expert, I find this thread interesting. It seems to me (amateur opinion) if the contract did at least, identify the goods to be purchased, and was silent on the shipping terms and destination, then most likely the seller was only obligated until his/her performance ended, which would be when the items were placed in shipment. So, it would seem this would end up being a shipment contract. Just my two cents.

By formerfed on Tuesday, March 20, 2001 - 12:47 pm

OK, here's another amateur opinion. Assuming the UCC is silent on this issue and this dispute goes to liigation. Accordiung to the definitions in UCC, the "Burden of establishing" a fact means the burden of persuading the triers of fact that the existence of the fact is more probable than its non-existence" Therefore, one party is attempting to pursuade a trier that shipping terms are one way or the other. The basis of deciding depends on what might be logically expected by the parties. And that depends on the nature of the commodity and that specific marketplace. For example, it's almost self evident that buying computer software or a magazine subscription involves the supplier shipping to destination. On the other hand, buying a shipment of water heaters from a manufacturer usually means the purchaser pays transportation. In other words, what is the logical expectation of the parties without mentioning the matter.

By Ron Vogt on Tuesday, March 20, 2001 - 05:53 pm:

OK, here's my opinion as to why it would be interpreted as a shipment contract, with title and risk of loss passing upon the seller's handing over the items to a carrier:

2-308 covers the situation where no place or means for delivery has been agreed upon. In that case, the place for delivery is seller's place of business. Title would pass at the time the goods become identified to the contract and the seller has completed its performance with respect to delivery (2-401). Since the contract is silent on delivery, title would pass when the seller puts the goods at the buyer's disposition and gives notice (2-503). This is roughly equivalent to a shipment contract where the seller only needs to put the goods in the hands of a carrier.

In addition, the comments to 2-503 state that the contract will not be a "destination" contract unless the seller specifically agrees to deliver to a named destination. Since we are presuming a contract in which the seller has not specifically agreed so, it cannot be a destination contract. Therefore, it is a shipment contract.

In any event, I do not see how such a contract can be interpreted as a destination contract, with title and risk of loss passing upon tender of delivery to the buyer.
Any further analysis or contrary views are welcome.