Reference no: EM133525348
ASSIGNMENT: Snow Blower Dispute: Equipment Plus vs Parts Warehouse
ACTIVITY 1
Equipment Plus contracts to buy a batch of special snowblower handles from its supplier, Parts Warehouse for $10000. The supplier, Parts Warehouse, called the day before the agreed-on delivery date and notified Equipment Plus that they would not be able to fill any of the order for at least a year.
Equipment Plus was furious as they had a new trial order for Home Depot for 100 of their new Snow Blower 2000's. In a desperate attempt to supply the snowblowers, Equipment Plus found another supplier that could make the handles for them in about a week. The rush order of handles came at a premium price of $14000. The supply of handles from the new supplier was delivered on time.
Equipment Plus managed to make and ship 50 of their snow blowers to Home Depot before the agreed deadline. Equipment Plus calculated lost profits of $20,000 on the other 50 mowers that they did not deliver on time to Home Depot. The other 50 mowers were left unfinished and unsold.
Equipment Plus were also concerned about their damaged relationship with Home Depot and thought they would lose future business because of their short shipment.
Is there a breach of contract and if so what type of breach? Be prepared to support your answers.
What are the liquidated damages if any? Define liquidated damages.
What are the other damages, are they reasonable and will it be easy for Equipment Plus to claim them? Research damages to see which, if any, apply here
Use all resources available to you to search for legal precedent cases to support your answers in this case
ACTIVITY 2
You have made a contract in January with a manufacturer to supply certain locomotive engine parts with delivery by April. In February, you receive a phone call from the manufacturer who advises you that they can not supply the parts until August at the earliest. Date of delivery is a condition of the contract.
Does a contract actually exist? Explain.
Is this a breach of warranty or condition? Please explain.
Under what circumstances can the contract continue?
How can a Purchaser protect themselves in this instance?