American Fine Arts Edition, Inc. v. Patel

Nimeshbha Patel (defendant) was an art collector. In September 2005, Patel visited an art gallery owned by American Fine Arts Edition, Inc. (AFAE) (defendant). While there, Patel expressed interest in purchasing two paintings. AFAE agreed to sell Patel the paintings, informing him that AFAE itself would handle their delivery to his doorstep, that the paintings would arrive in a condition identical to what they were in the gallery, and that Patel need not worry about anything. Patel agreed to allow AFAE to ship the paintings in accordance with AFAE’s usual practices. But Patel declined AFAE’s offer to purchase shipping insurance. AFAE declined to provide Patel with a tracking slip, instead declaring that it would just call Patel to tell him what day the paintings would arrive. But AFAE never called Patel to tell him when the paintings had shipped or when they were expected to arrive. As a result, Patel never had the opportunity to purchase cargo insurance on the paintings to protect himself against the risk of loss. AFAE delivered the two paintings to FedEx for delivery to Patel. FedEx attempted to deliver the paintings to Patel on 10 occasions. Finally, FedEx recorded that the paintings were delivered and signed for by an individual named “N. Paterl.” But Patel himself never received the paintings, and he rescinded payment for them. AFAE sued Patel for breach of contract. The trial court ruled in favor of AFAE, finding that Patel bore the risk of loss for the paintings under the parties’ shipping contract. Patel then sought review in the Arizona Court of Appeals.