## Facts

- Ernest and Adele Ramirez agreed to buy a new camper van from Autosport for $14,100, with a $4,700 trade-in allowance for their existing van; delivery was expected around August 3, 1978.
- The Ramirezes left their old van with Autosport as the trade-in.
- On August 3, the Ramirezes inspected the camper and found defects (scratched paint, missing electric and sewer hookups, missing hubcaps); they did not accept delivery and were told the camper was not ready.
- After repeated assurances it was still not ready, Autosport told the Ramirezes to return on August 14.
- On August 14, workers were still touching up paint, and interior cushions were soaking wet; Autosport suggested the Ramirezes take the camper and promised later replacement, but they refused.
- The parties discussed a price holdback; the Ramirezes sought a larger holdback than Autosport would allow, and no delivery occurred.
- Autosport transferred title of the camper to the Ramirezes without notifying them and continued to delay completion of the tender.
- The Ramirezes later demanded rescission/cancellation and the return of their trade-in van; Autosport refused and sold the trade-in to a third party.
- The Ramirezes sued for rescission/cancellation and restitution of the trade-in value; Autosport counterclaimed for breach of contract.
- The trial court held the Ramirezes rightfully rejected the camper and awarded the fair market value of the trade-in; the Appellate Division affirmed.

## Issues

1. Under UCC Article 2, may a buyer reject goods when the tender fails to conform to the contract in any respect, even if defects are characterized as minor?
2. How does the seller’s right to cure under UCC § 2-508 affect the buyer’s right to reject under UCC § 2-601 in a single-delivery contract?
3. If conforming tender is not made within a reasonable time, may the buyer cancel and recover restitution measured by the fair market value of a trade-in that the seller has sold?

## Decision

- The Supreme Court of New Jersey affirmed.
- The Court held the Ramirezes rightfully rejected Autosport’s nonconforming tenders under the UCC perfect tender rule.
- The Court held Autosport’s cure opportunity did not defeat rejection because Autosport failed to make a conforming tender within a reasonable time.
- The Court upheld cancellation and restitution, including an award of the fair market value of the trade-in van after Autosport sold it.

## Legal Principles

- Under UCC § 2-601 (perfect tender), in a non-installment contract the buyer may reject goods if the goods or tender of delivery fail in any respect to conform to the contract.
- UCC § 2-508 allows a seller to cure a nonconforming tender within the contract time, and in some circumstances within a further reasonable time if the seller reasonably believed the tender would be acceptable.
- A seller’s cure right is time-limited; repeated nonconforming tenders and continued delay can support a finding that no conforming tender was made within a reasonable time.
- Where the buyer rejects before acceptance, the case is governed by rejection and cancellation remedies, not revocation of acceptance under UCC § 2-608.
- Upon rightful rejection and cancellation, the buyer is entitled to restitution of consideration already provided; if a trade-in cannot be returned because the seller sold it, restitution may be awarded as the trade-in’s fair market value.

## Conclusion

The court held that buyers who never accepted delivery may reject goods that are nonconforming in any respect, and if the seller does not cure within a reasonable time, the buyers may cancel the contract and recover restitution, including the fair market value of a trade-in the seller has disposed of.


Ramirez v. Autosport, 88 N.J. 277, 440 A.2d 1345 (N.J. 1982)