Syncrude Canada Inc operates a massive tar sands project in Northern Alberta. For the purposes of that

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Syncrude Canada Inc operates a massive tar sands project in Northern Alberta. For the purposes of that project, Syncrude required two devices. First, it contracted to have a mining gearbox designed and delivered by Hunter Engineering Inc. The parties' contract in that instance contained an "express warranty" stating that the device was free from defects. That express warranty, however, was said to be effective for only 12 months following purchase. Second, Syncrude contracted to have an extraction gearbox designed and delivered by Allis-Chalmers Ltd (ACL). The parties' contract in that instance contained two important provisions. Once again, the device was said, under an "express warranty," to be free from defect for a 12-month period. In addition, the contract also stated that the 12-month express warranty was "the only warranty . . . and no other warranty or conditions, statutory or otherwise shall be implied." Although both devices were expected to last for at least 10 years, both failed after two years. Syncrude consequently was required to shut down operations while replacement parts were acquired. The resulting financial loss was enormous. Syncrude has now sued both Hunter and ACL for breach of contract. Is a court likely to hold either defendant liable? Explain your answer.

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Managing the Law The Legal Aspects of Doing Business

ISBN: 978-0133847154

5th edition

Authors: Mitchell McInnes, Ian R. Kerr, J. Anthony VanDuzer

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