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instance, minor wear, tear, and other changes during a buyer’s initial use, testing, troubleshooting, or inspection of goods should not impede revocation. The same reasoning applies to other minor defects. On the other hand, if the goods have materially deteriorated or were completely destroyed, or if the buyer no longer has them ( e.g. , because the buyer resold them), revocation may be barred. Of course, the buyer need not return worthless goods to the seller, at least if they were worthless upon delivery. [U.C.C. § 2-608(2), cmt. 6 (1951); 2 Hawkland UCC Series § 2-608:2, Westlaw (database updated June 2021).] Example : A distributor of vitamin products contracted to buy a tablet press from a manufacturer. The distributor accepted the machine, installed it, modified it, and used it for about 10 months to produce more than 225 million vitamin tablets before finally seeking to revoke acceptance. Here, on similar facts, a federal court found that the revocation did not precede a substantial change in the machine’s condition. In installing the machine, modifying it (by punching a hole in its cover), and using it so extensively, the distributor substantially changed the machine’s condition. [ See IMA N.A., Inc. v. Marlyn Nutraceuticals, Inc. , No. CV–06–0344–PHX–LOA, 2009 WL 160367 (D. Ariz. Jan. 22, 2009).] Compare : A prospector contracted to buy, from a manufacturer, equipment for Arctic drilling operations. Upon accepting the equipment, the prospector added a corporate logo to the equipment and installed some metal siding to help keep the unit warm during the bitterly cold Siberian winter. Otherwise, the prospector made no significant changes to the equipment. After the equipment manifested numerous problems, the prospector sought to revoke acceptance and return the equipment to the manufacturer. On similar facts, the Fifth Circuit held that the revocation came before any substantial change to the equipment. Merely adding a corporate logo and metal siding was no material alteration at all. Rather, these small changes represented merely the prospector’s reasonable use of the equipment before revocation. [ See Vemex Trading Corp. v. Tech. Ventures, Inc. , 563 Fed.Appx. 318 (5th Cir. 2014).] Insurable Interest in Goods Once existing goods are identified to the contract, the buyer obtains an insurable property interest in the goods under Article 2. This rule applies even if (1) the goods do not conform to the contract, or (2) the buyer may return or reject the goods. As for the seller, she retains an insurable interest in the goods so long as she has either title to or any security interest in the goods. These rules allow the buyer and seller to properly insure the goods. [ See U.C.C. § 2-501(1) (1951); 2 Hawkland UCC Series § 2-501:2, Westlaw (database updated June 2021).]
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