Case 3 (12:4)

Carlos sold his business inventory to Avi for $10,000. Under their agreement, Avi was to pay Carlos $1,000 per month over a 10-month period, commencing on March 1st of that year. Before the first payment was due, Carlos became indebted to Avi for $5,000. Carlos then assigned the $10,000 debt agreement to Malcolm. Notice of this assignment was given to Avi. When he discovered that he was to make all payments under the agreement to Malcolm, he informed Malcolm that he would not make a payment until August. He would then make only the five remaining payments under the agreement and consider the debt fully satisfied.Discuss the rights of Avi and Malcolm and the reasoning behind Avi's response to the notice.

Case 4 (13:1)

The Ebert Electrical Company contracted and paid for 80 air-conditioners at a special discount price made by the Kool-Air Equipment Company. The units were to be installed by Ebert in a new condominium development planned by Carson Developments Ltd. Delivery of the air-conditioners was to take place within 7 days of Carson's architects confirming that final electrical inspections were complete. Carson eventually went bankrupt and the confirmation was never issued. What is the legal position of Ebert and Kool-Air?

Case 5 (14:11)

The Canada Tea Co. entered into a contract to purchase 400 wooden chests of tea from an off-shore tea merchant. On receipt, it was discovered that some of the tea chests had insects in the wood, but not in the tea, which was enclosed in sealed plastic bags inside the chests. Canada Tea Co. warned the supplier that it would refuse acceptance of any future shipments that were infested with insects. A second order for 400 wooden chests of tea was placed. On arrival, the tea chests were examined. Evidence that insects had been in the wood was revealed, but no insects were found in the shipment. Canada Tea Co. rejected the shipment. The off-shore tea merchant then took legal action against Canada Tea Co. for the value of the shipment. Discuss the nature of defense (if any) that Canada Tea Co. might raise. Indicate the possible outcome of the case.