This Federal Supreme Court decision highlights the importance for the buyer to meet its burden of proving timely notice of defects and for the seller to avoid a tacit waiver of its right to invoke late notice.
The buyer was entitled to invalidate a sales contract (an asset deal for the sale of a car dealership that included software) for fraud that was committed by the seller (Art. 28 SCO) because the seller had not disclosed to the buyer that it did not own the intellectual property rights on the software but only had a license to use the software granted by a third-party licensor.
