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FACT PATTERN

Marta operated a successful fishing shop. She needed a new bait cooler, which had to be in place by May 1 for the first day of fishing season.

On February 1, Marta entered into a valid written contract with Don to purchase a Bait Mate cooler for $5,500 to be delivered no later than April 15.

On February 15, Don called Marta and told her that he was having trouble procuring a Bait Mate cooler. Marta reminded Don that meeting the April 15 deadline was imperative. “I’ll see what’s possible,” Don responded in a somewhat doubtful tone. Concerned that Don might be unable to perform under the contract, Marta immediately sent him the following fax: “I am worried that you will not deliver a Bait Mate cooler by April 15. Please provide your supplier’s guarantee that the unit will be available by our contract deadline. I want to have plenty of time to set it up.” Believing that Marta’s worries were overblown and not wanting to reveal his supplier’s identity, Don did not respond to her fax.

When Don attempted to deliver a Bait Mate cooler on April 16, Marta refused delivery. Marta had purchased a Bait Mate cooler from another seller on April 14, paying $7,500, which included a $2,000 premium for one-day delivery by April 15.

Have Marta and/or Don breached the contract? Discuss.

Operation Management, Management Studies

  • Category:- Operation Management
  • Reference No.:- M93110947

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