41-02-38. (2-321) C.I.F. or C. & F. - Net landed weights - Payment on arrival - Warranty
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/nd/title-41/chapter-41-02-sales/41-02-38·A research copy — for the controlling text, always check the official state or federal source. Not legal advice.
of condition on arrival.
Under a contract containing a term C.I.F. or C. & F.:
1. If the price is based on or is to be adjusted according to "net landed weights",
"delivered weights", "outturn" quantity or quality, or the like, unless otherwise agreed
the seller must reasonably estimate the price. The payment due on tender of the
documents called for by the contract is the amount so estimated, but after final
adjustment of the price a settlement must be made with commercial promptness.
2. An agreement described in subsection 1 or any warranty of quality or condition of the
goods on arrival places upon the seller the risk of ordinary deterioration, shrinkage,
and the like in transportation but has no effect on the place or time of identification to
the contract for sale or delivery or on the passing of the risk of loss.
3. Unless otherwise agreed, if the contract provides for payment on or after arrival of the
goods, the seller must before payment allow such preliminary inspection as is feasible
but, if the goods are lost, delivery of the documents and payment are due when the
goods should have arrived.
41-02-39. (2-322) Delivery ex-ship. 1. Unless otherwise agreed, a term for delivery of goods "ex-ship" (which means from the
carrying vessel) or in equivalent language is not restricted to a particular ship and
requires delivery from a ship which has reached a place at the named port of
destination where goods of the kind are usually discharged. 2. Under such a term unless otherwise agreed:
a. The seller must discharge all liens arising out of the carriage and furnish the
buyer with a direction which puts the carrier under a duty to deliver the goods;
and
b. The risk of loss does not pass to the buyer until the goods leave the ship's tackle
or are otherwise properly unloaded.
41-02-40. (2-323) Form of bill of lading required in overseas shipment - Overseas. 1. If the contract contemplates overseas shipment and contains a term C.I.F. or C. & F. or
F.O.B. vessel, the seller unless otherwise agreed must obtain a negotiable bill of lading
stating that the goods have been loaded on board or, in the case of a term C.I.F. or
C. & F., received for shipment. 2. If in a case within subsection 1 a tangible bill of lading has been issued in a set of
parts, unless otherwise agreed if the documents are not to be sent from abroad the
buyer may demand tender of the full set; otherwise only one part of the bill of lading
need be tendered. Even if the agreement expressly requires a full set:
a. Due tender of a single part is acceptable within the provisions of this chapter on
cure of improper delivery (subsection 1 of section 41-02-56); and
b. Even though the full set is demanded, if the documents are sent from abroad the
person tendering an incomplete set may nevertheless require payment upon
furnishing an indemnity which the buyer in good faith deems adequate. 3. A shipment by water or by air or a contract contemplating such shipment is "overseas"
insofar as by usage of trade or agreement it is subject to the commercial, financing, or
shipping practices characteristic of international deep water commerce.
41-02-41. (2-324) No arrival, no sale term. Under a term "no arrival, no sale" or terms of like meaning, unless otherwise agreed: 1. The seller must properly ship conforming goods and if they arrive by any means the
seller must tender them on arrival but the seller assumes no obligation that the goods
will arrive unless the seller has caused the nonarrival; and 2. If without fault of the seller the goods are in part lost or have so deteriorated as no
longer to conform to the contract or arrive after the contract time, the buyer may
proceed as if there had been casualty to identified goods (section 41-02-76).
41-02-42. (2-325) Letter of credit term - Confirmed credit. 1. Failure of the buyer seasonably to furnish an agreed letter of credit is a breach of the
contract for sale. 2. The delivery to seller of a proper letter of credit suspends the buyer's obligation to pay.
If the letter of credit is dishonored, the seller may on seasonable notification to the
buyer require payment directly from the buyer. 3. Unless otherwise agreed, the term "letter of credit" or "banker's credit" in a contract for
sale means an irrevocable credit issued by a financing agency of good repute and, if
the shipment is overseas, of good international repute. The term "confirmed credit"
means that the credit must also carry the direct obligation of such an agency which
does business in the seller's financial market.
41-02-43. (2-326) Sale on approval and sale or return - Rights of creditors. 1. Unless otherwise agreed, if delivered goods may be returned by the buyer even
though they conform to the contract, the transaction is:
a. A "sale on approval" if the goods are delivered primarily for use.
b. A "sale or return" if the goods are delivered primarily for resale.
2. Goods held on approval are not subject to the claims of the buyer's creditors until
acceptance. Goods held on sale or return are subject to such claims while in the
buyer's possession.
3. Any "or return" term of a contract for sale is to be treated as a separate contract for
sale within the statute of frauds section of this chapter (section 41-02-08) and as
contradicting the sale aspect of the contract within the provisions of this chapter on
parol or extrinsic evidence (section 41-02-09).