In the case that opened the chapter,Abbott Industries supplied 1.2 million tubes of bad eye medication to Altana,a customer,for resale.What did the court rule regarding the liability of Abbott Industries?
A)That Altana was only entitled to receive cover,meaning substitution for the defective medication.
B)That Abbott industries was liable for the cost of the recall and destruction of the defective medication,for the costs of employee overtime,and for lost future sales even though Altana was able to meet its contractual obligations.
C)That Abbott industries was liable for the cost of the recall and destruction of the defective medication and for the costs of employee overtime,but not for lost future sales because Altana was able to meet its contractual obligations.
D)That Abbott industries was liable for the cost of the recall and destruction of the defective medication,for the costs of employee overtime,and for lost future sales because Altana was unable to meet its contractual obligations.
E)That Altana was unable to recover anything because business people take a risk that some shipments will be bad.

Question

Quizplus · Accepted Answer

A)Employing a test that requires the breaching party Abbott)to put the
non-breaching party Altana)in the position it would have been in had there not been a breach,the court found that in addition to costs for recall and destruction,Abbott was liable to Altana for the overtime payments to employees in order to make up the lost batch and satisfy Altana's contractual customers.However,when the issue of future sales was considered,the court ruled that despite Abbott's breach,Altana was still able to fulfill all of its existing contracts.To award any money to Altana on loss of future sales would be speculative and an unfair windfall to Altana.
B)Employing a test that requires the breaching party Abbott)to put the
non-breaching party Altana)in the position it would have been in had there not been a breach,the court found that in addition to costs for recall and destruction,Abbott was liable to Altana for the overtime payments to employees in order to make up the lost batch and satisfy Altana's contractual customers.However,when the issue of future sales was considered,the court ruled that despite Abbott's breach,Altana was still able to fulfill all of its existing contracts.To award any money to Altana on loss of future sales would be speculative and an unfair windfall to Altana.
C)Employing a test that requires the breaching party Abbott)to put the
non-breaching party Altana)in the position it would have been in had there not been a breach,the court found that in addition to costs for recall and destruction,Abbott was liable to Altana for the overtime payments to employees in order to make up the lost batch and satisfy Altana's contractual customers.However,when the issue of future sales was considered,the court ruled that despite Abbott's breach,Altana was still able to fulfill all of its existing contracts.To award any money to Altana on loss of future sales would be speculative and an unfair windfall to Altana.
D)Employing a test that requires the breaching party Abbott)to put the
non-breaching party Altana)in the position it would have been in had there not been a breach,the court found that in addition to costs for recall and destruction,Abbott was liable to Altana for the overtime payments to employees in order to make up the lost batch and satisfy Altana's contractual customers.However,when the issue of future sales was considered,the court ruled that despite Abbott's breach,Altana was still able to fulfill all of its existing contracts.To award any money to Altana on loss of future sales would be speculative and an unfair windfall to Altana.

In the Case That Opened the Chapter,Abbott Industries Supplied 1