Smith and Roberson's Business Law 16th Edition by Richard Mann,Barry Roberts

Exercise 8

A customer requests certain sophisticated tests on equipment he purchased from your factory. Such tests are very expensive and must be performed by a third party. The equipment was tested as requested and met all of the industry standards, but showed anomalies that could not be explained. Though the problem appears to be minor, you decide to inspect the unit to try to understand the test data-a very expensive and time-consuming process. You inform the customer of this decision. A problem is found, but it is minor and highly unlikely ever to cause the unit to fail. Rebuilding the equipment would be very expensive and time-consuming; moreover, notifying the customer that you are planning to rebuild the unit would also put your overall manufacturing procedures in question. Should you fix the problem, ship the equipment as is, or inform the customer? Explain.