Article 2 — Sales · Section 2-510
Analyzes the risk of loss in the context of sales under the Uniform Commercial Code.
Source: U.C.C. § 2-510
Unless otherwise agreed: (a) the buyer shall bear the risk of loss of goods identified to the contract in possession of the buyer; (b) the seller shall bear the risk of loss of goods identified to the contract in the possession of the seller; (c) if the seller is to ship and has not yet delivered the goods, the seller bears the risk of loss until receipt by the buyer; (d) if the buyer has not accepted the goods, risk of loss remains with the seller until acceptance; (e) if the goods have been identified and are in possession of a bailee, the risk of loss passes to the buyer only on receipt of a negotiable document of title or after the buyer has otherwise taken possession of the goods.
UCC § 2-510 outlines who bears the risk of loss for goods in a sales contract. Generally, if the goods are in the buyer's possession, the buyer bears the risk, while the seller bears the risk if the goods are still with them unless otherwise agreed upon.
The legal responsibility for the loss or damage of goods in a sales transaction.
A person or entity to whom goods are delivered for a specific purpose, but not transferred ownership.
Example 1
A buyer purchases a laptop, and it is shipped but not yet delivered. The risk of loss remains with the seller until delivery.
Example 2
A seller retains possession of a specific batch of wine after the sale. The seller bears the risk of loss until the buyer takes possession.