§490:2-502  Buyer's right to goods on seller's repudiation, failure to deliver, or insolvency.  (1)  Subject to subsections (2) and (3), and even though the goods have not been shipped, a buyer who has paid a part or all of the price of goods in which the buyer has a special property under the provisions of the immediately preceding section may on making and keeping good a tender of any unpaid portion of their price recover them from the seller if:

    (a)   In the case of goods bought for personal, family, or household purposes, the seller repudiates or fails to deliver as required by the contract; or

    (b)   In all cases, the seller becomes insolvent within ten days after receipt of the first installment on their price.

     (2)  The buyer's right to recover the goods under subsection (1)(a) vests upon acquisition of a special property, even if the seller had not then repudiated or failed to deliver.

     (3)  If the identification creating the buyer's special property has been made by the buyer, the buyer acquires the right to recover the goods only if they conform to the contract for sale. [L 1965, c 208, §2-502; HRS §490:2-502; am L 2000, c 241, §14]

 

COMMENTS TO OFFICIAL TEXT

 

  Prior Uniform Statutory Provision:  Compare Sections 17, 18 and 19, Uniform Sales Act.

  Purposes:

  1.  This section gives an additional right to the buyer as a result of identification of the goods to the contract in the manner provided in Section 2-501.  The buyer is given a right to the goods on the seller's insolvency occurring within 10 days after he receives the first installment on their price.

  2.  The question of whether the buyer also acquires a security interest in identified goods and has rights to the goods when insolvency takes place after the ten-day period provided in this section depends upon compliance with the provisions of the Article on Secured Transactions (Article 9).

  3.  Subsection (2) is included to preclude the possibility of unjust enrichment which exists if the buyer were permitted to recover goods even though they were greatly superior in quality or quantity to that called for by the contract for sale.

  Cross References:

  Point 1:  Sections 1-201 and 2-702.

  Point 2:  Article 9.

  Definitional Cross References:

  "Buyer".  Section 2-103.

  "Conform".  Section 2-106.

  "Contract for sale".  Section 2-106.

  "Goods".  Section 2-105.

  "Insolvent".  Section 1-201.

  "Right".  Section 1-201.

  "Seller".  Section 2-103.