Printable Format84-2-320. C.I.F. and C.&F. terms. (1) The term C.I.F. means that the price includes in a lump sum the cost of the goods and the insurance and freight to the named destination. The term C.&F. or C.F. means that the price so includes cost and freight to the named destination.
(2) Unless otherwise agreed and even though used only in connection with the stated price and destination, the term C.I.F. destination or its equivalent requires the seller at his own expense and risk to
(a) put the goods into the possession of a carrier at the port for shipment and obtain a negotiable bill or bills of lading covering the entire transportation to the named destination; and
(b) load the goods and obtain a receipt from the carrier (which may be contained in the bill of lading) showing that the freight has been paid or provided for; and
(c) obtain a policy or certificate of insurance, including any war risk insurance, of a kind and on terms then current at the port of shipment in the usual amount, in the currency of the contract, shown to cover the same goods covered by the bill of lading and providing for payment of loss to the order of the buyer or for the account of whom it may concern; but the seller may add to the price the amount of the premium for any such war risk insurance; and
(d) prepare an invoice of the goods and procure any other documents required to effect shipment or to comply with the contract; and
(e) forward and tender with commercial promptness all the documents in due form and with any indorsement necessary to perfect the buyer's rights.
(3) Unless otherwise agreed the term C.&F. or its equivalent has the same effect and imposes upon the seller the same obligations and risks as a C.I.F. term except the obligation as to insurance.
(4) Under the term C.I.F. or C.&F. unless otherwise agreed the buyer must make payment against tender of the required documents and the seller may not tender nor the buyer demand delivery of the goods in substitution for the documents.
History: L. 1965, ch. 564, ยง 54; January 1, 1966.
KANSAS COMMENT, 1996
This section states the common commercial understanding of the terms "C.I.F." (cost of goods, insurance, freight) and "C.&F." (cost of goods, freight). Unlike the term "F.O.B.," defined in the previous section, the terms discussed in this section are not delivery terms but only price terms. Accordingly, a C.I.F. contract or a C.&F. contract is a shipment contract not a destination contract, even though the term is used in connection with a named destination. Thus, risk of loss passes to the buyer when the seller delivers the goods to a common carrier. See 84-2-509. Subsection (2) states the seller's tender obligations under a C.I.F. contract, and subsection (3) makes clear that the obligations are the same under a C.&F. term except for the duty to obtain insurance. Subsection (4) states the presumption that, under either of these terms, payment is to be made against the tender of documents.