Sunny Farms grows grains and legumes. This past year, it planted a large crop of lentils. Part of Sunny's business plan is to get commitments from purchasers in advance of the harvest by way of contract. To that end, once the entire crop had been planted, Sunny Farms entered into a significant contract with Lentils & Lima Beans Inc (L&L), a Canadian distributor of legumes known for selling exclusively to high-end health food stores. Part-way through the season, a period of unusual rain prevented Sunny Farms from spraying down the crop. This was an important part of the lentil growing process and it put the entire crop in jeopardy.

Sunny Farms decided not to mention this to any of its customers, hoping that the crop would come through as originally planned. The failure to spray had significant consequences. The lentils, although successfully harvested, were not fit for human consumption and could be used only as cattle feed. When L&L found this out, it tried to renege on the contract. It claimed that Sunny Farms knew very well that L&L was in the business of selling human food, not cattle feed.

The terms and conditions of the contract did not contemplate what would happen in the event of crop failure. Sunny Farms decided to sue for breach of contract, claiming that the contract was for lentils and L&L got their lentils. L&L made a counterclaim, alleging that it was Sunny Farms that was in breach of contract since it never got what it ordered and now it was stuck without a supply of lentils for the season.

Analyze the facts of this case and determine whether there are any contractual defects and, if so, what will be the likely outcome at trial.