Opinion ID: 262002
Heading Depth: 1
Heading Rank: 1

Heading: the buyer's right to inspect

Text: 9 A buyer dealing with a distant vendor and purchasing goods of a specified quality without first seeing them has a right to inspect them upon receipt. Pope v. Allis, 1885, 115 U.S. 363, 372, 6 S.Ct. 69, 29 L.Ed. 393 (dictum); see Rivers Bros. Co. v. Putney, 1921, 27 N.M. 177, 199 P. 108, 27 A.L.R. 520 at 522; Fore v. Plant Seed Co., Mo.Ct.App. 1921, 232 S.W. 169. And, in the absence of any contractual provision to the contrary, the buyer may reject an F.O.B. shipment at destination. N. W. Helm Feed & Coal Co. v. Butler County Milling Co., 1925, 218 Mo.App. 290, 269 S.W. 630; Fore v. Plant Seed Co. But the parties may agree instead to abide by the judgment of another, and that judgment, if honestly exercised, is binding on the buyer. Del Bondio v. Jacob Dold Packing Co., 1899, 79 Mo.App. 465; see Great Atl. & Pac. Tea Co. v. Smith, W.D.Ark., 75 F.Supp. 156, aff'd 8 Cir., 1948, 170 F.2d 474; 46 Am.Jur., Sales 248; cf. Arkla Lumber & Mfg. Co. v. Henry Quellmalz Lumber & Mfg. Co., Mo.1923, 252 S.W. 961 (seller also bound). The buyer cannot thereafter substitute his own inspection for that conducted by the third party. In Gratiot St. Warehouse Co. v. Wilkinson, 1902, 94 Mo.App. 528, 68 S.W. 581, a contract for sale provided that corn was to be shipped F.O.B. St. Louis, Missouri, 'St. Louis inspection: to Jackson, Mississippi. The St. Louis inspection showed the corn to be in good condition but upon its arrival in Jackson the purchaser refused to accept it because an inspection there ascertained it to be wet, moldy, and rotten. The court, however, found that the St. Louis inspection was conclusive as to grade and quality, and stated, 10 'We need not stop to inquire whether the title passed to appellants when the grain was delivered to the carrier in St. Louis to be transported to Jackson. It is enough that they had agreed to buy on St. Louis inspection. When that inspection determined the grain was of the quality ordered, they became bound by their agreement to accept and pay for it when it reached Jackson, and are responsible for the damages respondent sustained by their refusal to do so.' 68 S.W. at 585. 11 Such an inspection is held to have a conclusive effect even if there is no express provision in the contract that it shall be final. E.g., Chapman v. Kansas City, C. & S.R. Co., 1893, 114 Mo. 542, 21 S.W. 858; Massman Const. Co. v. Lake Lotawana Ass'n, 1948, 240 Mo.App. 469, 210 S.W.2d 398; see Rogers v. Rehard, 1906, 122 Mo.App. 44, 97 S.W. 951, 953. 12 The contract in question here provides that in barge' official weights & grades' are to govern-- if the shipment is made from Nebraska City. But-- if the shipment is made from Omaha, although 'official 'in barge' grades' still govern, 'destination official weights' are to govern. Thus, the contract is drawn to distinguish between an inspection where the grain is loaded and an inspection at its destination. An inspection at the destination is to determine the weight, if the grain is loaded at Omaha. That is the only circumstance in which a destination inspection is to control. The terms of the contract therefore required that the transaction be governed by the origin grades and weights, since the grain was shipped from Nebraska City. 13 As we noted, where an inspection by a third party is stipulated, it supersedes the buyer's right to inspect. Merchants, however, seeks to avoid this result by urging that the clause in its printed form contract, which was accepted by Bartlett's agent, gave it the right to inspect at destination and to reject the shipment if the quality proved to be below the specified grade at the destination. This interpretation of the contract would nullify the provision for inspection at origin. The obvious purpose of that inspection at origin was to establish a certain, reliable, and objective standard at a fixed place and time to give the transaction certainty. It would serve little use to have this inspection, if the buyer were free to accept or reject the shipment after its arrival on the basis of its own inspection at destination. To the extent then that the printed clause in the contract may be interpreted to allow Merchants the right, for which it contends, to reject on the basis of its own destination inspection, it is inconsistent with the typewritten clause providing for one official inspection at origin. In such case the typed portions prevail. Saranac Automatic Mach. Corp. v. Duke, 5 Cir., 1933, 67 F.2d 436; see Collins v. Roth, Mo.Ct.App.1949, 224 S.W.2d 129, 132; Belt Seed Co. v. Mitchellhill Seed Co., 1941, 236 Mo.App. 142, 153 S.W.2d 106, 110. 14 The contract before us, however, may be construed so as to reconcile the two clauses and thus satisfy the very sensible canon of construction requiring that effect be given to all terms of the contract. The typed clause provides that official grades are to govern, whereas the printed clause, upon which Merchants relies, reserves to it the 'right to reject shipment in event quality proves to be below contract grade.' This gives Merchants the right to reject, if the quality does not satisfy the contractual requirements; it does not give Merchants the right to determine whether the quality measures up to the standard specified. Thus Merchants could reject the grain, if the grade given it by the Nebraska City inspector proved to be lower than that specified in the contract, but the reservation clause does not give it the power to ascertain the grade independently of the origin inspection. Furthermore, this reserved right to reject is expressly conditioned on the draft being paid at sight. Since it is possible that the draft would be paid before receipt of the inspection certificate, this is a reasonable provision. It simply avoids any question that payment of the on-sight draft might be deemed a waiver of the right to reject the shipment. See Ryder & Brown Co. v. E. Lissberger Co., 1938, 300 Mass. 438, 15 N.E.2d 441, 118 A.L.R. 521, 525-526, in which the court assumed that the right to reject is lost when the title passes to the buyer on payment of a sight draft. 15 The testimony of Merchants's agent shows that in the customary dealings in the trade lower prices are fixed on condition that there is no right to reject on the basis of a destination inspection when the grain is inspected at origin. Mr. Harriss, Merchants's manager, agreed that Mr. Walls, who received the shipment in Alabama and bought on the same terms as Merchants, had no right to inspect the shipment at Guntersville. Moreover, the broker testified that his confirmation order showed the entire arrangement between the two parties; that it contained no right to reject. We hold, therefore, that Merchants did not have any right to reject the shipment destination on the basis of inspection at destination. 16