Contracts: Remedies: In Rem: Right to Reclaim

• Right to Reclaim: Unpaid Seller’s Right to Reclaim Goods under Article 2

• Gen Rule: unpaid seller has no rights under Article 2 in goods it has delivered to the buyer.

• [narrow] exception: unpaid seller has a right to reclaim goods from the buyer if: (1) the buyer was insolvent when it received the goods and (2) seller demands return within 10 days of B’s receiving the goods.

• Seller has no right to reclaim goods from a third party where B has already sold goods to a third party.

• Exception: Seller has a right to reclaim goods at any time if the buyer misrepresented its solvency to the seller in writing within 3 months before delivery. (Policy: we will not let B benefit from his written misrepresentation).