Preliminary Agreements and Indefinite or Vague Contracts Flashcards
SportCo operates a chain of sporting goods stores, and BallCo manufactures a variety of articles tied to sports. BallCo publishes a price catalog, which it updates from time to time, ordinarily sending the current edition to all of its regular customers.
In 2009, BallCo published an updated price catalog in which it posted a price of $288 per gross (144) of baseballs. BallCo published no new catalog until January 2019, when it did publish one, setting the price of baseballs at $319 per gross.
During the years 2009-2018, SportCo had ordered a total of 100,000 gross of BallCo’s baseballs and paid, always, the catalog price of $288 per gross. In March 2019, the parties exchanged these signed writings:
March 1, SportCo writes: Purchase Order — Please ship immediately to our warehouse at 4400 Raritan Way, Coppertown, PA, 10,000 gross of your baseballs. Will expect invoice with delivery. Thank you.
March 2, BallCo writes: Sales Confirmation — Thank you for your order. Will ship promptly, with invoice.
March 3, SportCo writes: With apologies we must cancel our recent order for 10,000 gross of baseballs. Please do not ship.
BallCo insists that SportCo is contractually obliged to purchase the baseballs. SportCo maintains that because they never discussed price, the parties did not form a contract.
Pursuant to UCC Article 2, is SportCo’s position correct?
A. Yes, because when goods are sold, price is a material term
B. Yes, because no two parties form a contract unless one puts to the other a bargain of reasonably specific terms
C. No, because the parties implicitly agreed on a “reasonable price”
D. No, because BallCo changed its published price only once in ten years
C. No, because the parties implicitly agreed on a “reasonable price”
SportCo operates a chain of sporting goods stores, and BallCo manufactures a variety of articles tied to sports. BallCo publishes a price catalog, which it updates from time to time, ordinarily sending the current edition to all of its regular customers.
In 2009, BallCo published an updated price catalog in which it posted a price of $288 per gross (144) of baseballs. BallCo published no new catalog until January 2019, when it did publish one, setting the price of baseballs at $319 per gross.
During the years 2009-2018, SportCo had ordered a total of 100,000 gross of BallCo’s baseballs and paid, always, the catalog price of $288 per gross. In March 2019, the parties exchanged these signed writings:
March 1, SportCo writes: Purchase Order — Please ship immediately to our warehouse at 4400 Raritan Way, Coppertown, PA, 10,000 gross of your baseballs. Will expect invoice with delivery. Thank you.
March 2, BallCo writes: Sales Confirmation — Thank you for your order. Will ship promptly, with invoice.
March 3, SportCo writes: With apologies we must cancel our recent order for 10,000 gross of baseballs. Please do not ship.
BallCo insists that SportCo is contractually obliged to purchase the baseballs. SportCo maintains that because they never discussed price, the parties did not form a contract.
For this question only, assume that BallCo sent SportCo its 2009 catalog but not the one it published in 2019. When BallCo insists that SportCo must buy the baseballs, SportCo agrees and stands ready to pay $288 per gross. BallCo demands $319, the price set forth in its 2019 catalog. All other facts are as originally set forth. Probably, BallCo is entitled to be paid
A. $288, because that is the price it has repeatedly charged SportCo, and SportCo had no notice that the price had been changed.
B. $288, because it is unreasonable for a seller suddenly to publish a higher price to a long-time buyer who has customarily and in good faith paid a lower one.
C. $319, because under these circumstances a buyer should reasonably expect to pay according to a seller’s published price list.
D. nothing, because a buyer need not pay a price to which he has not agreed.
A. $288, because that is the price it has repeatedly charged SportCo, and SportCo had no notice that the price had been changed.
BanaCo and StatCo deal in electrical equipment. In its catalog StatCo lists the prices for some of its products, but not for #4 conducting wire. On July 11, BanaCo sends StatCo this signed written message: “We wish immediately to have 4,000 feet of your #4 conducting wire. We do not see the item listed in your catalog, so we propose that price will be agreed on later. Please ship.” On July 12, StatCo responds with this signed writing: “Thank you. We will ship.” Have BanaCo and StatCo formed a contract?
A. Yes, because where goods are bought and sold, price is not a material term
B. Yes, because notwithstanding the open price term, their interaction reflects finality of agreement
C. No, because two parties do not form a contract if they agree that a material term will be subject to future agreement
D. No, because a seller who declines to publish its price shows an intention not to sell
B. Yes, because notwithstanding the open price term, their interaction reflects finality of agreement
