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Chapter 20
Remedies for Breach of Sales and Lease Contracts
VI. Answers to Critical Legal Thinking Cases
20.1 Nonconforming Goods
Hartz elected to reject the entire shipment. The Appellate Court ruled that Hartz’s action was appropriate,
based upon the buyer’s right to reject nonconforming goods. Jacob Hartz Seed Co. v. Coleman, 612
S.W.2d 91, 1981 Ark. Lexis 1153 (Supreme Court of Arkansas)
20.2 Right to Cure
the defect. In the court’s opinion, since Grady had allowed Thompson over two months to repair the car,
there was an adequate opportunity for Thompson to cure the defect. Subsequently, when Thompson was
unable to repair the Chevette in this two-month period, Grady was able to revoke the sales contract. The
Appellate Court affirmed the trial court’s decision that Grady had given Thompson an adequate
opportunity to cure the defect. General Motors Acceptance Corp. v. Grady, 501 N.E.2d 68, 1985 Ohio
App. Lexis 10353 (Court of Appeals of Ohio)
20.3 Right to Resell Goods
appellate court held that Meuser could properly recover the amount spent on the upkeep of the equipment
as incidental damages. However, the amount that the trial court awarded for contract-resale damages was
20.4 Right to Recover Lost Profits
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seller of ordinary items in the same position as if the buyer had performed the sales contract. When the
goods are ordinary items or of relatively unlimited supply, the seller would have made two sales instead
of one if the original buyer had not breached. Therefore the seller can be awarded its lost profits,
Appeals for the Fifth Circuit)
20.5 Specific Performance
Yes, the Sedmaks can obtain specific performance of the sales contract for the limited edition Corvette.
When a sales contract is for a unique good, the UCC provides that a buyer may obtain specific
contract for the Corvette, the Sedmaks were entitled to obtain specific performance. The court ordered
Charlie’s to sell the Indy Pace Car Corvette to the Sedmaks. Sedmak v. Charlie’s Chevrolet, Inc., 622
S.W.2d. 694, 1981 Mo. App. Lexis 2911 (Court of Appeals of Missouri)
20.6 Right to Cover
the right to cover. By immediately contracting with another commercial supplier of gravel, Gallop Sand
and Gravel Company, Nowlin covered in good faith and in reasonable time. Because Nowlin covered in
VII. Answer to Ethics Case
20.7 Ethics Case
Yes, it was commercially reasonable for Lincoln to request the delivery of sand during December. The
Allsopp already had the sand stockpiled, it was not reasonable for it to charge an extra amount to load
during December. Therefore, its refusal of Lincoln’s request was unreasonable. Lincoln was allowed out
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