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Laurel Corp, in Forest Hills, New York ordered by telephone 100 Mahogany wood table sets with 4 chairs at a cost of $2,000 per unit from Hardy Manufacturing Co. In North Carolina with delivery in 45 days at "buyers warehouse". Laurel followed up with a writing which summarized its order and at the bottom it said: "Sign and Return. See Terms on Reverse Side". On the opposite side it said: "In the event of any dispute, parties will proceed by court action." Five days later, Hardy responded by letter: "Thank you for Order. Buyer to remit 20% of price within 10 days of Order with delivery at buyer's place within 45 days. Sign and Return. See Terms on Reverse Side. On the opposite side it said: "In the event of any dispute, parties will proceed by arbitration only OR defaulting buyer will pay $250,000 as liquidated Damages" Neither party signed an acknowledgement and ten days later, Laurel remitted 20% of the price. Thirty days later, Hardy advised Laurel in writing it was shipping the tables and chairs by ABC Truck Co. with delivery to arrive in 4 days. It also included the bill of lading. While the truck was in route from North Carolina to New York, a storm caused the truck driver to lose control of the vehicle and it flipped over resulting in a total loss of all merchandise. Hardy demanded the balance owed or $250,000 in liquidated damages for breach; Laurel demanded the return of its deposit or a new shipment of good since it never received what it ordered. Later, Hardy demanded arbitration OR $250,000 and Laurel refused. Discuss the rights of all parties. Must the buyer pay the liquidated damages? Must the parties proceed to arbitration? Court? Is there a contract? Why? Why not? Discuss fully.
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