word. Advise the parties. cro abo Case Problems for Discussion Juic res CASE 1 ma Ming's home was located on a rural residential lot over- told the caller that his father wanted fill in the ravins ap looking a pretty ravine, and he thought that he might at which the caller was delighted. Dump trucks began fri arriving non-stop through the afternoon, bearing ar enjoy a small terrace behind his home for a patio. He the logo of Rock-kut Highway Excavators Lid. When of placed a sign at the road in front of his home with the words "Clean Fill Wanted" and his telephone number. Ming returned from work, he was aghast at the sight While Ming was at work one morning, a caller rang before him. about the sign, and Ming's teenage son answered. He Discuss the issues raised in this situation. CASE 2 Mckay operated a large farm on which he grew a variety Ltd. by the next week if the additional 1,000 bags would of vegetables for commercial canners. He also grew a be available. Daigle nodded approval and left. smaller quantity for sale to local retailers and wholesalers A few days later, Mckay discovered that crop fail- as fresh produce. On August 5th, Susan Daigle of Daigle ures in other parts of the province had pushed carrot Wholesale Foods Ltd. approached Mckay and offered to prices substantially above the price offered by Daigle purchase 5,000 5-kilogram bags of carrots from him at Wholesale Foods Ltd. Mckay's crop, however, was abun- a fixed price per bag. Mckay stated that the price was acceptable to him, but he was uncertain as to whether his dant, and he discovered that he had 6,000 bags when the crop was harvested. crop would be sufficient to make up the 5,000 bags. He told Daigle he could definitely supply 4,000 bags, and that At the end of the week, Susan Daigle called to he would be in a position to tell Daigle Wholesale Foods determine if Mckay could supply her with 5,000 bags, or only 4,000. Mckay refused to supply Daigle WholesaleCHAPTER 7 An Introduction to Contracts | 135 Foods Lid. with any carrots, and informed her that it was his intention to sell the crop elsewhere. the parties. Assume that Daigle Wholesale Foods Lid. Discuss the negotiations between th veen the parties, and brought an action against Mckay, determine the rights (if any) and liabilities (if any) of Discuss the nature of the action and render, with reasons, a decision. CASE 3 Armstrong Aggregates Co. wrote a letter to Bishop on May 2nd offering to sell him 200 tonnes of scrap refused to sell the mica to Bishop at $180 per tonne, but mica at $180 per tonne. Bi ne. Bishop received the letter on expressed a willingness to sell at the current market May 3rd. A few weeks later, Bishop checked the price of price of 6187 per tonne. mica, and discovered that the market price had risen to Bishop instituted legal proceedings against Arm- #185 per tonne. On May 22nd, Bishop wrote Armstrong strong for breach of the contract that he alleged existed Aggregates Co., accepting the offer. Armstrong did between them. not receive Bishop's letter until May 30th. Armstrong Discuss the rights (if any) and the liabilities (if any) of the parties, and render a decision. CASE 4 The Clear Fruit Juice Company purchased a quantity of a special variety of apple that Ely grew in his orchards Over the course of the summer, Ely heard rumours The apple was of a typ a type that kept well in winter storage. that an orchard some kilometres distant had acquired a and the company would market a portion of the apples contract to supply his variety of apple to the company, but he did nothing to investigate the matter further. In purchased as fresh fruit and process the remainder into the fall of that year, he delivered his usual supply in large apple juice that it sold under a private brand name. The pallet boxes to the company and placed them in the company purchase represented approximately 50 per- storage yard. No employees were in the yard at the time, cent of Ely's total harvest each year, but Ely did not find the fact unusual, as that was typi- Initially, the Clear Fruit Juice Company and Ely cally the case when he made his deliveries in the past. entered into a formal, written purchase agreement for He was not concerned about identification of the crop each year's crop. However, over time the agreement as each pallet box bore his name and address as well as became less formal. Eventually it consisted at first of the variety and quantity. a telephone order for the "usual supply," and later to The yard foreman noticed the apples in the supply an arrangement whereby Ely would deliver the normal yard some time later on the day of delivery, and informed quantity to the company each year, and in due course the plant manager. The plant manager did nothing about would receive payment at the going market price for the the apples until the next day, when he informed the com- crop. This latter arrangement carried on for a period of pany president. The company president decided to write about ten years. a letter to Ely requesting him to take back his apples, In the last year, the president of the Clear Fruit but it was Friday, so he left the letter until Monday of Juice Company fell seriously ill and retired. He had been the next week. Ely received the letter on the Wednesday, responsible for the original contracts with Ely, and had some six days after delivery of the fruit to the company. made the later informal arrangements for the supply of During the six-day period the apples had remained apples. For many years, the two men had been good in the hot sun and had deteriorated from the exposure. friends. The new president of the company moved to the Ely refused to take back the apples, and the company area from a subsidiary corporation and was not aware refused to pay for them. of the arrangement between Ely and the company. He Advise the parties of their rights in this case, and decided that for the current year he would purchase the determine the probable outcome if Ely should bring an company's apple requirements from another orchard. action against the company for the value of the goods. CASE 5 The Garden Book Company advertised in a local of her $30 cheque. Laurel mailed her letter at 4:20 p.m. newspaper the publication of its latest book on flower on February 21st. growing. The advertisement indicated that orders would The Garden Book Company received Laurel's letter be taken by mail at a price of $30 per copy, but the book of February 19th on February 22nd, and mailed her a would be available at all book stores as well. letter the same day that acknowledged her order and In response to the advertisement, Laurel Bush sent advised her that the book would be sent to her by courier her cheque for $30 to the Garden Book Company, and within a few days, The Garden Book Company received requested in her letter that the company send her a copy Laurel's letter of February 21st on February 23rd. The of the book by return mail. Laurel mailed her letter on company ignored her second letter, and delivered the February 19th. On February 21st, Laurel noticed the same book to the courier on February 25th. Discuss the rights of the parties in this case. Identify book on sale at a local book store at a price of $9,95, She purchased a copy, then went home and immediately and explain the legal principles and rules applicable, and indicate in your answer how the case would be decided wrote a letter to the Garden Book Company revoking her offer to purchase the book, and requested a return if the matter came before the court.136 PART 3 The Law of Contract CASE 6 Following this response, East Country Exploration The Golden Lake Mining Company decided to dispose decided to examine property "B." and sent out its full of two of its undeveloped mining properties (A and B) geologists to do a brief exploratory evaluation," and authorized the company president to find a buyer. October 6th they reported back to say that they had On September 10th, the president wrote a letter to the examined property B and found some surface evident East Country Exploration Corporation offering to sell of what might be a potentially economic ore bolt the properties "en bloc" for $500,000 worth between $5 million and 915 million. East Court On September 16th, East Country Exploration Exploration then prepared a letter accepting the off Corporation replied by mail to the letter in which it of Golden Lake Mining to sell properties A and B expressed an interest in the purchase of property A at $500,000. The letter was mailed on October 9th. a price of $275,000 if Golden Lake Mining was prepared On October 10th the president of Golden Lake to sell the properties on an individual basis. Mining Company found a buyer for the B property On September 22nd, the president of Golden Lake a price of $300,000, and signed signed a sale agreement Mining replied by fax that he would prefer to sell both the same day. He then wrote a letter to East County properties, but if he could not find a buyer for the two Exploration in which he accepted their offer to buy the parcels within the next few weeks, the Company might consider selling the properties on an individual basis. A property for $275,000. The president of Golden Lake On September 30th, the East Country Exploration Mining received the October 9th letter of East Country Exploration on October 11th. Corporation made an inquiry by fax to determine if Golden Lake Mining had decided to sell the properties Discuss the issues raised in this case, and indicate on an individual basis. The president of Golden Lake in your answer how the case might be decided if it was responded with a fax that stated: "Still looking for a brought before the court. buyer for both properties." CASE 7 Yo Tamiko lived in Calgary, Alberta, and owned a cottage at $298,000. The letter was posted at 11:40 a.m, on on Vancouver Island. Percy, who lived in Victoria, British September 23rd, but, through a delay in the mail, was Columbia, was interested in purchasing the cottage owned not delivered to Tamiko in Calgary until 4:20 p.m. on by Tamiko. On September 10th, he wrote a letter to Tamiko September 28th. offering to purchase the cottage and lot for $275,000. In the meantime, when Tamiko had not heard from Tamiko received the letter on September 15th, and sent Percy by September 26th she offered to sell the cottage Percy a fax offering to sell the cottage to him for $298,000. to Johnson, who had expressed an interest in purchas- Percy did not respond to the fax immediately, but on ing the cottage some time before. Johnson accepted a business trip to Calgary on September 22nd, he spoke to Tamiko about the cottage in an effort to determine the offer, and the two parties executed a written pur- if Tamiko might be willing to reduce the price. Tamiko chase agreement in Johnson's office on the morning of September 27th. Co replied that the price was "firm" at $298,000. When Percy returned to Victoria, he sent a let- Identify the various rights and liabilities that devel- ter to Tamiko accepting her offer to sell the cottage oped from the negotiations set out above. CASE 8 Tom was tired of running his business and was look- ing for a buyer so he could retire before the winter. Bill thousand, I am going to sell it to Dan." Bill paid Tom the wanted to buy the business, but needed another month $5,000. Thirty days later, Bill appeared at Tom's door Con to raise the necessary finances. Tom said to Bill: "Look, with $45,000. Tom said: "Sorry, I am going to sell it to for $5,000, I will give you an option to purchase in 30 Dan. I said the price was $50,000." Bill was confused, Son days, but if you are not ready to buy at that time for fifty and sought legal advice. in th CASE 9 What advice would the lawyer provide to Bill? whic in re Janine owned a shop selling fine bone china. After a customer dropped an expensive bowl and shattered it, Janine made a new policy by posting a sign reading it sold." In time, another customer broke a vase she was "Lovely to look at, lovely to hold, if you break it, consider examining but refused to pay for it. customer. Discuss the legal position of both Janine and her Online Learning Centre The Online Learning Centre offers more ways to check what you have learned so far Find quizzes and other resources at www.mheducation.ca/olc/willes