Printing Center of Texas, Inc. v. Supermind Publishing Co.
669 S.W.2d 779 (1984)
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Rule of Law:
Under the Uniform Commercial Code's perfect tender rule, a buyer may rightfully reject goods if they fail to conform to the contract in any respect, but this right is limited by an obligation of good faith, and the seller bears the burden of proving the buyer's rejection was made in bad faith.
Facts:
- Supermind Publishing Co., Inc. ('Supermind') entered into a written contract with Printing Center of Texas, Inc. ('Printing Center') for the printing of 5,000 books.
- The contract specified the use of 'thirty pound white newsprint' paper.
- Printing Center showed Supermind a sample of the white newsprint that would be used for the books.
- Upon delivery, Supermind discovered that the paper used was gray instead of white, the cover art was off-center, pages were crooked and wrinkled, and a pull-out page was inadequately perforated.
- Supermind rejected the entire shipment of books, alleging they did not conform to the contract.
Procedural Posture:
- Supermind Publishing Co., Inc. sued Printing Center of Texas, Inc. in a Texas county court at law, seeking a refund of its $2900 deposit.
- The case was tried before a jury, which found that the books delivered by Printing Center failed to conform to the contract.
- The trial court entered a judgment in favor of Supermind Publishing Co., awarding the deposit refund plus attorney's fees.
- Printing Center of Texas, Inc., as appellant, appealed the trial court's judgment to the Court of Appeals of Texas. Supermind Publishing Co., Inc. is the appellee.
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Issue:
Does a buyer's right to reject goods for any non-conformity under the UCC's perfect tender rule (§ 2-601) permit rejection based on defects that violate express or implied warranties, subject to a limitation that the rejection must be made in good faith?
Opinions:
Majority - Cannon, Justice
Yes. A buyer has the right under the UCC's perfect tender rule to reject goods for any non-conformity, including breaches of express and implied warranties, but this right is limited by the obligation of good faith. The perfect tender rule, codified in UCC § 2-601, requires complete performance, not merely substantial performance. Conformity is measured against the entire contract, which includes express terms, course of dealing, and implied warranties. In this case, an express warranty was breached because the paper color did not match the sample provided (§ 2-313), and the implied warranty of merchantability was breached because books with off-center art, crooked pages, and other defects were not fit for their ordinary purpose of public sale (§ 2-314). While the buyer's right to reject is powerful, it is tempered by the UCC's pervasive requirement of good faith (§ 1-203). A buyer cannot reject goods in bad faith, for instance, by using a minor defect as a pretext to escape a bad bargain. The burden of proof is on the seller to demonstrate that the buyer acted in bad faith. Here, Printing Center failed to produce any evidence that Supermind's rejection was motivated by anything other than the genuine non-conformities.
Analysis:
This case solidifies the application of the UCC's 'perfect tender rule' in Texas, affirming the strict standard that goods must conform in every respect, not just substantially. More importantly, it establishes that the powerful right to reject is not absolute; it is limited by the buyer's duty of good faith. By placing the burden of proving bad faith on the seller, the court creates a check against buyers who might use minor, non-material defects to opportunistically escape a contract. This decision balances the buyer's right to receive precisely what was bargained for with the seller's need for protection against pretextual rejections, influencing how contracts for goods are enforced and how disputes over conformity are litigated.
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