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Texas Business & Commerce Code - Section 2.326. Sale On Approval And Sale Or Return; Rights Of Creditors

Legal Research Home > Texas Lawyer > Business & Commerce Code > Texas Business & Commerce Code - Section 2.326. Sale On Approval And Sale Or Return; Rights Of Creditors

§ 2.326. SALE ON APPROVAL AND SALE OR RETURN;  RIGHTS OF 
CREDITORS.  (a) Unless otherwise agreed, if delivered goods may be 
returned by the buyer even though they conform to the contract, the 
transaction is
		(1)  a "sale on approval" if the goods are delivered 
primarily for use, and 
		(2)  a "sale or return" if the goods are delivered 
primarily for resale.    
	(b)  Goods held on approval are not subject to the claims of 
the buyer's creditors until acceptance;  goods held on sale or 
return are subject to such claims while in the buyer's possession.
	(c)  Any "or return" term of a contract for sale is to be 
treated as a separate contract for sale within the statute of frauds 
section of this chapter (Section 2.201) and as contradicting the 
sale aspect of the contract within the provisions of this chapter on 
parol or extrinsic evidence (Section 2.202).

Acts 1967, 60th Leg., p. 2343, ch. 785, § 1, eff. Sept. 1, 1967.  
Amended by Acts 1977, 65th Leg., p. 1530, ch. 623, § 4, eff. Aug. 
29, 1977;  Acts 1999, 76th Leg., ch. 414, § 2.16, eff. July 1, 
2001.

Last modified: August 10, 2007