Module 4 Problems

Module 4 Problems

Problem 10 - Cancellation Clause of Purchase

Gantos had given a purchase order to Gianni regarding purchase of holiday clothing. The order contained a clause saying, "the buyer reserves the right to terminate by notice to seller all of any part of this purchase order with respect to goods that have not been shipped for any reason whatsoever." The contract showed that there was above 20% of Gianni's business during that year, and about less than 1% of Gantos'.

After the cancellation of the order by Gantos, Gianni put forth an option of 50% reduction in price if Gantos wanted to take the goods at which it agreed upon but after this agreement Gianni changed its mind and sued claiming that the second agreement which was made was unconscionable. The Appellate Court viewed it through at UCC §2-302 giving it a test test for unconscionability. A contract which permits one of the parties to cancel according to heir own wishes is totally not fair. The Court viewed that the cancellation which was made at the very last minute placed the Gianni in such a position in which it was supposed to absorb all the loss. This is unconscionable.

Problem 7- Breach of Contract

What Dyer did was absolutely right because why did Bennett at the first place gave wrong information to its customer. This shows that they have not done enough of their homework.

The Breach of Contract that took place in this situation was a result of misinterpretation and an act of mistrust that there was a sales tax that had to be paid off which was not mentioned by the seller, instead he said that all taxes have been paid. The information that had been provided to the customer was wrong, it broke his trust , there was no proper sales agreement to support the general principle of faith which is an integral element of sales. Such mistrust actually causes frustration to the customer who has all rights to breach a contract if it's not up to the rules and regulations (Posner, 2001).

The requirement of the parole evidence rule, is either oral or written evidence which would include or differ the parties' which are in written contract, which is something very clear-cut. The admittance of testimony contradicting as per the retail purchase order which was signed by the parties involved states that the entire agreement was constituted and ...