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1.5.2 Sale

Article 2 applies to “transactions in goods,”99 not just sales, but many of the key warranty provisions apply only to a “sale” or “contract for sale” of goods, or only to a “seller.”100 A sale “consists in the passing of title from the seller to the buyer for a price.”101 An installment sales contract is a transaction in goods even though it also involves financing.102 The consideration for a sale may be something other than money.103

On the other hand, one court held that a warranty issued as part of an agreement settling earlier litigation about a motor home was not issued as part of the sale, and thus was not an Article 2 warranty.104 An agreement by which a car salesman had use of a vehicle as a demonstrator was not a sale because it was clear that title would not pass to him.105 Neither a bailment106 or a license to use goods107 is a sale. A gift is not a sale.108

Even though the definition of sale refers to the passing of title, the introductory language to the definition states that the definition controls “unless the context otherwise requires.”109 In addition, U.C.C. § 2-401 provides that “each provision of [Article 2] with regard to the rights, obligations and remedies of the seller, the buyer, purchasers or other third parties applies irrespective of title to the goods except where the provision refers to such title.” A court therefore concluded that a franchisor who ordered a product could assert a warranty claim against the seller, even though the product was delivered to a franchisee.110

Footnotes

  • 99 {87} U.C.C. § 2-102.

  • 100 {88} See U.C.C. §§ 2-312(a), 2-313(1), 2-314(1), 2-315. See generally § 5.11, infra (definition of “seller”).

  • 101 {89} U.C.C. § 2-106(1). See Gunning v. Small Feast Caterers, Inc., 777 N.Y.S.2d 268 (N.Y. Sup. Ct. 2004) (restaurant’s provision of water to customer is sale even though there is no separate charge). See also U.C.C. § 2-103(1)(d) (definition of “seller”); § 1.5.9, infra (discussion of definition of seller).

  • 102 {90} Credit Acceptance Corp. v. Coates, 75 Va. Cir. 267 (Va. Cir. Ct. 2008).

  • 103 {91} Dahl v. Aritech, Inc., 66 U.C.C. Rep. Serv. 2d 770 (D. Minn. 2008) (participation in clinical trial, which provides manufacturer with research information, can be considered payment of a price and thus can be a sale subject to U.C.C. Article 2).

  • 104 {92} Deficcio v. Winnebago Indus., Inc., 2012 WL 1854123 (D.N.J. May 21, 2012).

  • 105 {93} Beattie v. Beattie (Boyles v. Martin Chevrolet-Buick, Inc.), 786 A.2d 549 (Del. Super. Ct. 2001). See also Auto-Owners Ins. Co. v. Heggies Full House Pizza, Inc., 51 U.C.C. Rep. Serv. 2d 946 (Minn. Ct. App. 2003) (loan of pizza ovens not a sale).

  • 106 {94} See Bonaccoloto v. Coca-Cola Enterprises, Inc., 1999 U.S. Dist. LEXIS 22732 (D. Mass. Feb. 11, 1999) (mag.) (Article 2 warranties do not arise in bailment).

  • 107 {95} Flying Double B, L.L.C. v. Doner Int’l, Ltd., 67 U.C.C. Rep. Serv. 2d 304 (E.D. Mich. 2008).

  • 108 {96} Neuhoff v. Marvin Lumber & Cedar Co., 370 F.3d 197 (1st Cir. 2004); Sisk v. Abbott Laboratories, 2012 WL 3155586 (W.D.N.C. June 19, 2012) (mag.) (U.C.C. warranties do not attach to free sample), adopted by 2012 WL 3151277 (W.D.N.C. Aug. 2, 2012).

  • 109 {97} U.C.C. § 2-106.

  • 110 {98} Estate of Kriefall v. Sizzler USA Franchise, Inc., 801 N.W.2d 781, 793–795 (Wis. Ct. App. 2011), aff’d, 816 N.W.2d 853 (Wis. 2012).