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Law School Case Brief

Keahey v. Osborne Ford-Lincoln-Mercury, Inc - 485 So. 2d 182 (La. Ct. App. 1986)

Rule:

Where parties enter into a contract for the sale of a future thing, title does not pass to either of them where the object of the contract is never built. The risk of loss remains with the party responsible for seeing the object is produced and prospective purchaser of that object is entitled to a return of the purchase price that the prospective purchaser has tendered if the object is not produced. 

Facts:

The parties entered into an agreement when the buyer saw an ad for a replica car and contacted the seller about obtaining one. The seller informed the buyer that the seller would have to order the car in its name because the manufacturer that built the cars would not take an order bearing an individual's name. The buyer delivered the payment for the car but it was never delivered because the manufacturer went bankrupt. The trial court ordered the return of the initial deposit and rejected buyer's demand for return of the purchase price the buyer paid for a replica car. The buyer appealed.

Issue:

Was the buyer entitled to the return of the purchase price of the replica car on the premise that the parties entered into a contract for the sale of a future thing?

Answer:

Yes.

Conclusion:

The court found the parties had a contract for the sale of a future thing. Since title never passed to the buyer because the car was never built, the risk of loss remained with the seller and the buyer was entitled to have the purchase price returned, along with applicable interest.

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