Alabama § 7-2-326 “Sale on Approval” and “Sale or Return.”

Alabama Statutes

§ 7-2-326 — “Sale on Approval” and “Sale or Return.”

Alabama § 7-2-326

Title 7Commercial Code

Art. 2Sales

Part 3General Obligation and Construction of Contract

This text of Alabama § 7-2-326 (“Sale on Approval” and “Sale or Return.”) is published on Counsel Stack Legal Research, covering Alabama primary law. Counsel Stack provides free access to over 12 million legal documents including statutes, case law, regulations, and constitutions.

Bluebook

Ala. Code § 7-2-326 (2026).

Text

(1)Unless otherwise agreed, if delivered goods may be returned by the buyer even though they conform to the contract, the transaction is:

(a)A “sale on approval” if the goods are delivered primarily for use, and

(b)A “sale or return” if the goods are delivered primarily for resale.

(2)Goods held on approval are not subject to the claims of the buyer’s creditors until acceptance; goods held on sale or return are subject to such claims while in the buyer’s possession.

(3)Any “or return” term of a contract for sale is to be treated as a separate contract for sale within the statute of frauds section of this article (Section 7-2-201) and as contradicting the sale aspect of the contract within the provisions of this article on parol or extrinsic evidence (Section 7-2-202).

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(1) Unless otherwise agreed, if delivered goods may be returned by the buyer even though they conform to the contract, the transaction is:
(a) A “sale on approval” if the goods are delivered primarily for use, and
(b) A “sale or return” if the goods are delivered primarily for resale.
(2) Goods held on approval are not subject to the claims of the buyer’s creditors until acceptance; goods held on sale or return are subject to such claims while in the buyer’s possession.
(3) Any “or return” term of a contract for sale is to be treated as a separate contract for sale within the statute of frauds section of this article (Section 7-2-201) and as contradicting the sale aspect of the contract within the provisions of this article on parol or extrinsic evidence (Section 7-2-202).