Uniform Commercial Code in Georgia

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The Uniform Commercial Code or UCC has been enacted in Georgia. It is the primary source of law in all contracts dealing with the sale of goods. It contains what has been acronymously called the TARR Baby. See article entitled Tender, Acceptance, Rejection and Revocation, the UCC’s “TARR” -Baby, 24 Drake Law Rev. 52 (1974)

  • TENDER – The tender provisions of the Uniform Commercial Code contained in Georgia Code Section 11- 2-601 provide that the buyer is entitled to reject any goods that fail in any respect to conform to the contract. Unfortunately, new cars are often complex and their innermost workings are beyond the understanding of the average new car buyer. The buyer therefore does not know whether the goods are then conforming.
  • ACCEPTANCE – The Georgia new car buyer therefore accepts the goods believing and expecting that the manufacturer will repair any problem he has with the goods under the warranty.
  • REJECTION – The auto consumer may discover a problem with the vehicle within the first few miles of his purchase. This would allow the new car buyer to reject the goods. If the new car buyer discovers a defect in the car within a reasonable time to inspect the vehicle, he may reject the vehicle. This period is inexact. On the one hand, the buyer must be given a reasonable time to inspect and that implies a right to use the vehicle. On the other hand, continued use or use beyond a reasonable time to inspect will be held to be an acceptance of the vehicle. The Georgia Courts will decide this reasonable time to inspect based on the knowledge and experience of the buyer, the difficulty in discovering the defect, and the opportunity to discover the defect. The Georgia Courts have made it clear that a Georgia buyer cannot continue to use the goods if he gives notice of rejection. This will amount to “reacceptance”. An illustrative case of rejection follows: Mr. Zabriskie purchased a new 1966 Chevrolet Biscayne. After picking up the vehicle on Friday evening, while en route to his home 2.5 miles away, and within 7/10ths of a mile from the dealership, the car stalled, and stalled again within 15 feet. Thereafter, the vehicle would only drive in low gear. The buyer rejected the vehicle and stopped payment on his check. The dealer contended that the buyer could not reject the car because he had driven it around the block and that was his reasonable opportunity to inspect. The Court said:

    To the layman, the complicated mechanisms of today’s automobiles are a complete mystery. To have the automobile inspected by someone with sufficient expertise to disassemble the vehicle in order to discover latent defects before the contract is signed, is assuredly impossible and highly impractical. Consequently, the first few miles of driving become even more significant to the excited new car buyer. This is the buyer’s first reasonable opportunity to enjoy his new vehicle to see if it conforms to what it was represented to be and whether he is getting what he bargained for. How long the buyer may drive the new car under the guise of inspection of new goods is not an issue in the present case because 7/10th of a mile is clearly within the ambit of a reasonable opportunity to inspect.

    We have successfully argued this theory to several Georgia juries.

  • REVOCATION – What happens when the consumer has used the new car for a lengthy period of time? This is the law that we typically use in Georgia. It is found in Georgia Code Section 11-2-608. Georgia law provides that a buyer may revoke his acceptance of goods whose non-conformity substantially impairs the value of the goods to him when he has accepted the goods without discovery of nonconformity because it was difficult to discover or if he was assured that non-conformities would be repaired. Of course, the average new car buyer does not learn of the nonconformity until hundreds or thousands of miles later. And because quality is job one, and manufacturers are competing based on their warranties, the consumer is always assured that any nonconformity he does discover will be remedied. In fact, here in Georgia, we think that manufacturers teach their dealers to assure their customers that there is nothing wrong with the car and that if there is, that they will fix it, to increase the likelihood that the consumer will continue to operate the car.What is a nonconformity substantially impairing the value of the vehicle?
    1. Nonconformity may include a number of relatively minor defects whose cumulative total adds up to substantial impairment. This is the “Shaken Faith” Doctrine first stated in the Zabriskie case. “For a majority of people the purchase of a new car is a major investment, rationalized by the peace of mind that flows from its dependability and safety. Once their faith is shaken, the vehicle loses not only its real value in their eyes, but becomes an instrument whose integrity is substantially impaired and whose operation is fraught with apprehension.”
    2. A substantial nonconformity may include a failure or refusal to repair the goods under the warranty. Substantial Non Conformity and Lemon Laws– Learn more about Georgia lemon laws to see how lemon laws often define what may be considered a substantial impairment. These definitions have been successfully used to flesh out the substantial impairment in the UCC.
    3. Revocation of acceptance is an available remedy even where the seller has disclaimed all warranties.

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