Ala. Code § 7-2-326

“Sale on Approval” and “Sale or Return.”

Known as the Uniform Commercial Code

The act spans §§ 7-10-101 to 7-9A-809 (703 sections).

Applied in 2 court decisions — leading case McGregor v. Jackson (In Re Auclair) (1991)

Most recently applied in Georgetown Steel Co. v. Progress Rail Services Corp. (In Re Georgetown Steel Co.) (September 2004)

(Acts 1965, No. 549, p. 811; Act 2001-481, p. 647, §2.)

(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 7-2-201) and as contradicting the sale aspect of the contract within the provisions of this article on parol or extrinsic evidence (Section 7-2-202).

Official source: Alabama Legislature (ALISON). Reproduced from public-domain Alabama statutes; confirm against the official source for the current text. Not legal advice.