Josh is the receiving dock supervisor for Cabinet Co., a company that manufactur
ID: 460843 • Letter: J
Question
Josh is the receiving dock supervisor for Cabinet Co., a company that manufactures metal storage cabinets. His job is to supervise the inspection, and stocking of components and materials used in the manufacture of the cabinets as they are delivered; and to so notify the accounting department so invoices can be timely paid. On June 1, the company received a shipment of casters used in the manufacture of rolling cabinets. This new shipment would not be needed for three weeks as there were plenty of casters located on the assembly line. The storage facilities where the casters would normally be placed were under renovation, and there would be no space to store this latest shipment of casters until June 20. Frank decided to leave the unopened boxes of casters in a secure and covered corner of the receiving dock. He did, however, notify the accounting department that the casters had been received. The accounting department paid the $8,000.00 invoice in time to earn the discount if paid within ten days. On June 20 Frank had his workers open the boxes of casters to inspect then and place them in the appropriate space in the storage facility. Upon inspection it was determined that nearly all of the casters were defective and unusable. This caused the company to default on several contracts for rolling cabinets as it ran out of casters before it could secure replacements for the defective ones. Cabinet Co. was able to replace the casters at a 15% increase in cost.
Discuss Cabinet Co.'s remedies, duties and obligations with respect to the casters.
Explanation / Answer
Whenever you receive material from a supplier, it the reponsibility of the buyer to check that material before receiving it and giving conformation or payment to the supplier. In this case payment was made before the quality check was done. Supplier will not take the responsibility of the material at it was lying at the receiving dock and could have got damaged at the dock itself.
It is now the obligation of Cabinet Co's to take responsibility of the caster, get them repaired and complete the order.
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