Legislation
SECTION 2-326
Sale on Approval and Sale or Return; Rights of Creditors
Uniform Commercial Code (UCC) CHAPTER 38, ARTICLE 2, PART 3
Section 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, and
(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
Article (Section 2--201) and as contradicting the sale aspect of the
contract within the provisions of this Article on parol or extrinsic
evidence (Section 2--202).
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, and
(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
Article (Section 2--201) and as contradicting the sale aspect of the
contract within the provisions of this Article on parol or extrinsic
evidence (Section 2--202).