Problem 1 (25 marks)

Ebenezer has sold Christmas trees for the past five years. Each year he had purchased the trees from Gloria Marley who had a small tree farm in Northern Ontario. In order to ensure that he would have an adequate supply, Ebenezer entered into a contract with Gloria on September 15 to purchase all of her available trees at a price of $30.00 per tree. The contract read as follows:

"Ebenezer agrees to purchase and Gloria agrees to sell all of her Christmas trees (approximately 500) for $30.00 per tree. All trees are sold without warranty. Same terms as last year apply."

On December 1, Gloria cut the trees (which totalled 478), tagged them and placed them on the delivery truck. Orders were prepared directing the driver to make the delivery to Ebenezer. Gloria texted Ebenezer to advise that the trees were on the way.

Later that day the delivery truck slid off the road, resulting in the destruction of the trees.

Ebenezer purchased 500 Douglas Pine trees from another supplier at $40.00 per tree.

Subsequently Ebenezer received an invoice from Gloria for the full purchase price of $14,340.00. Upon further investigation, he has also discovered that 100 of the trees that were shipped were Scotch Pine trees and the balance were Douglas Pine trees. Ebenezers profit on the sale of "Douglas Pine" trees is $40.00/tree as opposed to $30.00/tree for Scotch Pine trees. In the previous years Gloria had delivered only Douglas Pine trees.

Ebenezer refuses to pay and sues Gloria for breach of contract. Gloria counterclaims for the price of $14,340.00.

Required: Explain the legal positions of Ebenezer and Gloria and the likely result. Be certain to cite all relevant legal principles including the relevant portions of the Sale of Goods Act.