Printable Format84-2-310. Open time for payment or running of credit; authority to ship under reservation. Unless otherwise agreed:
(a) Payment is due at the time and place at which the buyer is to receive the goods even though the place of shipment is the place of delivery; and
(b) if the seller is authorized to send the goods he may ship them under reservation, and may tender the documents of title, but the buyer may inspect the goods after their arrival before payment is due unless such inspection is inconsistent with the terms of the contract (K.S.A. 84-2-513, and amendments thereto); and
(c) if delivery is authorized and made by way of documents of title otherwise than by subsection (b) then payment is due regardless of where the goods are to be received (i) at the time and place at which the buyer is to receive delivery of the tangible documents or (ii) at the time the buyer is to receive delivery of the electronic documents and at the seller's place of business or if none, the seller's residence; and
(d) where the seller is required or authorized to ship the goods on credit the credit period runs from the time of shipment but post-dating the invoice or delaying its dispatch will correspondingly delay the starting of the credit period.
History: L. 1965, ch. 564, § 44; L. 2007, ch. 90, § 50; July 1, 2008.
KANSAS COMMENT, 1996
1. This section fills gaps as to terms of payment. Under paragraph (a), unless agreed otherwise, payment is due at the time and place the buyer is to receive the goods rather than the place of delivery. This rule corresponds with the buyer's right of inspection before payment. See 84-2-513. This paragraph also establishes that a party must bargain for credit under Article 2. Otherwise, the rule is "cash on the barrelhead." For a case applying the general rule of this section, see Southwest Eng'g Co. v. Martin Tractor Co., 205 K. 684, 475 P.2d 18 (1970).
2. Paragraph (b) protects a seller by permitting it to ship goods under reservation and thereby retain a security interest in the goods until payment is received. See 84-2-505. However, unless the contract requires payment against documents of title, the buyer is allowed to inspect the goods before payment. See 84-2-513. Under paragraph (c), when payment is due upon delivery of documents, the buyer must pay at that time and may lose its right of inspection before payment. Paragraph (d) states the common commercial understanding as to when an agreed period of credit begins to run when the contract is silent.
Law Review and Bar Journal References:
"Too Much Good Faith in Real Estate Purchase Agreements? Give Me an Option," Harvey L. Temkin, 34 K.L.R. 43, 54 (1985).
CASE ANNOTATIONS
1. Cited; this section supplies omitted term of contract. Southwest Engineering Co., Inc. v. Martin Tractor Co., Inc., 205 Kan. 684, 692, 693, 473 P.2d 18.
2. Contractor reasonably inferred that affidavits filed with invoices were a condition precedent to contractor's duty to pay. In Re John Gruss Co., Inc., 22 B.R. 236, 239 (1982).
3. Gap-filler statutes, under New York law, as unuseable where parol evidence admissible to establish missing terms examined. Rajala v. Allied Corp., 66 B.R. 582, 594 (1986).