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84-2-722. Who can sue third parties for injury to goods. Where a third party so deals with goods which have been identified to a contract for sale as to cause actionable injury to a party to that contract

(a) a right of action against the third party is in either party to the contract for sale who has title to or a security interest or a special property or an insurable interest in the goods; and if the goods have been destroyed or converted a right of action is also in the party who either bore the risk of loss under the contract for sale or has since the injury assumed that risk as against the other;

(b) if at the time of the injury the party plaintiff did not bear the risk of loss as against the other party to the contract for sale and there is no arrangement between them for disposition of the recovery, his suit or settlement is, subject to his own interest, as a fiduciary for the other party to the contract;

(c) either party may with the consent of the other sue for the benefit of whom it may concern.

History: L. 1965, ch. 564, ยง 118; January 1, 1966.

KANSAS COMMENT, 1996

This section determines the real party in interest when goods identified to the contract have been damaged by a third party. Prior to identification, only the seller has a cause of action. See Official Comments to this section. Under paragraph (a), both the buyer and the seller ordinarily would be a real party in interest after identification but before final acceptance. Under paragraph (b), a party that did not bear the risk of loss holds any recovery, subject to its own interest, in trust for the other party.

CASE ANNOTATIONS

1. Where the buyer fails to make payment due on or before delivery, the seller may cancel and resell the goods. Spikes v. Bauer, 6 Kan. App. 2d 45, 47, 626 P.2d 816.


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