Notice by Buyer - Cancellation for Breach/More Info


Notice by Buyer - Cancellation for Breach
Additional Information


Use caution when canceling an agreement for breach, as your agreement may limit your remedies.  This is particularly true where the contract has a warranty and the goods do not meet the warranty- the warranty itself probably limits the remedies the buyer is entitled to.

If the buyer has accepted goods that do not conform to the contract or if there has been a breach of warranty, the buyer must notify the seller of the breach within a reasonable time after it is discovered.  Otherwise, the UCC provides that the buyer is not entitled to complain.

If you already have the goods and have paid the purchase price, you may retain possession of the goods after canceling as security for the refund of the purchase price.

You may also be entitled to recover damages that you have suffered, especially if you were forced to purchase other goods to cover for the seller's defective goods.  The damages are usually calculated as the difference between the contract and the cost of purchase of covered goods.

The right of the buyer to cancel a sales contract may be lost by a delay in exercising the right.  The buyer who has full knowledge of the defects of the goods and makes a partial payment or performs acts of ownership inconsistent with an intent to cancel may lose his or her rights.

Also keep in mind that a buyer may have the right to some remedies in addition to those covered by the Uniform Commercial Code (UCC).  For example, if a seller has engaged in fraud, the buyer will probably be able to obtain relief for the fraud even though the UCC remedies may not be available.  Also, other state or federal laws may come into play.  For example, if you have purchased an automobile and later find that the odometer has been turned back, you may have rights under the federal Motor Vehicle Information and Cost Savings Act.  Under that law, the buyer may recover three times the actual damages sustained or $1,500, whichever is greater.  In addition, your state may have a similar law, and you may have more rights under the state's law.

Buyer's remedies for breach of the sales contract by seller are generally covered in Sections 2-710 through 2-717 of the UCC.

You should consult with an attorney before taking any actions regarding the cancellation of an agreement so you do not unnecessarily limit your remedies.