Sales Bar Review II
Prof. Bill Long 2/14/06
Sales Law Question from 2005 Oregon Bar Examination
The following question was on last Summer's Oregon Bar Examination. You have 35 minutes to answer the following question. It is best to list all issues from the Code and the common law that you think are helpful in answering the questions.
Roger buys raw red bell peppers, processes them and sells them to retailers. Roger had existing contracts with Oregon retailers to provide 1,000,000 pounds of processed peppers. Fred the Farmer agreed to sell Roger 1,000,000 pounds of unprocessed peppers at $.30 per pound, with delivery from September through November 2005. Fred and Roger signed a written contrat outlining the above.
To fulfill his contract with Roger, Fred purchased pepper seeds through the seed store, Peppers Plus. he spoke with a Peppers Plus employee and explained that he needed to grow 1,000,000 pounds of peppers for an Oregon pepper processor. Ultimately, Fred purchased the "Sweet Pepper Patty" variety because, in the words of the Peppers Plus employee who assisted him, "it is the sweetest pepper you have ever eaten--hands down." One week after Fred planted the seeds, Peppers Plus sent an invoice that contained a disclaimer of "all warranties, including any implied warranties." The disclaimer was in small writing in the far lower lef-hand corner of the invoice.
Fred began timely delivery of the peppers. In October, Roger asked Fred to stop delivering peppers because of a scheduling problem on the processing line. Roger explained that such delays were standard in the industry. Fred, a farmer for 20 years had never heard of this standard. Roger told Fred he did not know how long the delay would last and he should do whatever he needed to get rid of his peppers. Fred did not pick any peppers during the delay and the undelivered peppers reamined in storage bins and began to rot.
Ten days later, Roger told Fred that he could start delivering peppers again. Roger asked Fred if he was going to be able to fulfill the contract, and Fred said yes. At the end of November, Fred had only delivered 700,000 pounds of peppers to Roger. The retailers that recevied the 700,000 pounds of peppers returned them to Roger because they smelled and were sour.
To meet his contractual obligations to these retailers, Roger purchased replacement peppers on the open market at a price much higher than $.30 per pound. However, because of the changed market conditions,Roger was able to negotiate a significantly higher price from the retailers for the replacement peppers.
Applying the Uniform Commercial Code, discuss the following:
45% 1. What are Roger's claims against Fred and Fred's defenses, if any?
20% 2. If Roger prevails, what are his damages?
35% 3. What are Fred's claims against Peppers Plus and Peppers Plus's defenses, if any?
Click here for my treatment of the question.
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