Business Law and the Regulation of Business 11th Edition by Richard Mann, Barry Roberts

Exercise 1

On December 15, Judy wrote a letter to David stating that she would sell to David all of the mine-run coal that David might need to buy during the next calendar year for use at David's factory, delivered at the factory at a price of $50 per ton. David immediately replied by letter to Judy stating that he accepted the offer, that he would purchase all of his mine-run coal from Judy, and that he would need two hundred tons of coal during the first week in January. During the months of January, February, and March, Judy delivered to David a total of seven hundred tons of coal, for which David made payment to Judy at the rate of $50 per ton. On April 10, David ordered two hundred tons of mine-run coal from Judy, who replied to David on April 11 that she could not supply David with any more coal except at a price of $58 per ton delivered. David thereafter purchased elsewhere at the market price, namely $58 per ton, all of his factory's requirements of mine-run coal for the remainder of the year, amounting to a total of two thousand tons of coal. Can David now recover damages from Judy at the rate of $8 per ton for the coal thus purchased, amounting to $16,000?