42 BULLETIN 1414, IT. S. DEPARTMENT OF AGRICULTURE 



Rules governing destination track sales, agreed to by a number 

 of organizations representing shippers and the wholesale trade, 

 read in part as follows: 10 



When a commodity is sold on track after arrival at destination, the buyer 

 shall be considered to have waived any right to reject the commodity so pur- 

 chased upon receipt by him or his duly authorized representative, from the 

 seller or his dulj T authorized representative, of the bill of lading, delivery 

 order, or other document enabling him to get the goods from the carrier. 



The foregoing shall not be construed as depriving the buyer of a right to 

 reparation when the unloading of the car shall demonstrate that a part of 

 the lading which was not accessible to inspection was of a quality or condi- 

 tion much inferior to that portion which was accessible to inspection ; but 

 any such claim for reparation must be made within 24 hours after receipt of 

 delivery order or bill of lading. 



An f. o. b. sale may be made of carloads of fruits or vegetables 

 ready for shipment at the seller's station, of products to be loaded at 

 a specified future date, or of cars which are already en route to 

 market. The f. o. b. method of sale is defined as follows: 11 



F. o. b. sales, or quotations, means that the commodity quoted or sold is to 

 be placed free on board the car, or at ship side at shipping point, in suitable 

 shipping condition, and that the buyer assumes all risks of damage in transit 

 not caused by the shipper, whether there is a bill of lading to the order of 

 shipper or not. 



A draft, usually payable on the arrival of the shipment, is drawn 

 by the seller upon the buyer, and is sent, together with the bill of 

 lading, or a car-delivery order, to the buyer's bank. Upon payment 

 of the draft the bill of lading, or car-delivery order, is turned over 

 to the buyer. If the sale is made " f . o. b. usual terms," inspection 

 by the buyer is permitted prior to payment of the draft, but the 

 privilege of inspection does not influence the stated terms or condi- 

 tions of the sale. But if the terms and conditions of the sale have 

 not been complied with by the shipper, or if the product is not of 

 the grade or quality ordered, the buyer may refuse to accept the 

 shipment, or may ask for an allowance consistent with the difference 

 between the value of the product ordered by him and of that he has 

 actually received. 



Sales of fruits and vegetables by the f. o. b. method have increased 

 until at the present time a large portion is sold in this way, but the 

 system is as yet not thoroughly understood, and misunderstandings 

 often arise. Rejections of shipments sold f. o. b. have greatly in- 

 creased in the past two seasons. 



A third method of sale is the " delivered sale." The following 

 definition of a delivered sale has been accepted by trade organiza- 

 tions : 12 



Delivered sales or quotations mean that the commodity quoted or sold is to 

 be delivered by the seller on board the car, or -on dock if delivered by boat, 

 free of any and all charges for transportation or protective services, at the 

 market in which the buyer is located, or at such other market as agreed upon, 

 the seller assuming all risks of damage in transit not caused by the buyer. 



This method of sale has been in use for some time. A considerable 

 portion of the California citrus and deciduous shipments is also 

 sold on a delivered basis. 



10 Standard rules and definitions of trade terms, 1924. 



11 See footnote 10. 



12 See footnote 10. 



