Is it possible for a receiver/buyer to reject a portion of a distressed shipment?

Although a receiver/buyer decides whether to accept or reject a load that allegedly fails to comply with the sales agreement, buyers should be forewarned against accepting some portions of a shipment while rejecting others unless the parties agree otherwise specifically in writing.

The Perishable Agricultural Commodities Act (PACA) gives straightforward guidance and defines ‘Commercial Unit’ as “a single shipment of one or more perishable agricultural commodities for delivery on a single contract, such commercial unit must be accepted or rejected in its entirety”.

The items or commodities listed in a Bill of Lading are considered one commercial unit.

While PACA does not govern transactions outside of the US, it is referenced in the DRC rules as supportive.   We also note other choices of law such as the CISG have specific parameters regarding a buyers duties when non conforming goods are received.   In our experience partial rejections should only be done by agreement. 

When considering rejecting a load, the receiver/buyer must remember that the entire “commercial unit” must be rejected. Receivers/buyers may not unilaterally accept some pallets and reject others since accepting any portion of a lot constitutes acceptance of the entire lot.

It is possible to reject a portion of the load if a receiver/buyer has two transactions transported in one truck. In other words, where there are two contracts of sale or two Bills of Lading in the same truck, the items or commodities included in one of the Bills of Lading can be rejected provided an act of acceptance has not been committed and proper procedures to reject a load are followed.

Verified by MonsterInsights