In February 1997, Chrysler Corporation introduced a new promotional vehicle called the Plymouth Prowler. However, the company

Question:

In February 1997, Chrysler Corporation introduced a new promotional vehicle called the Plymouth Prowler. However, the company did not reveal whether it would manufacture any of the vehicles. Plaintiff became aware of the vehicle and of its uncertain production, and, on February 4, 1997, contacted several dealerships to inquire about purchasing a Prowler.

   On February 5, 1997, plaintiff met with Gary Rosenberg, co-owner of defendant-dealership and signed a ‘‘Retail Order for a Motor Vehicle’’ (hereinafter Agreement). The Agreement, which was filled out primarily by Rosenberg, stated that the order was for a 1997, V6, two-door, purple Plymouth Prowler. Moreover, it read :

Customer to pay $5,000 00/100 over list price by manufacturer. Money refundable if can not [deliver] by 12/30/97. Dealer to keep car 2 weeks.

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   The order also noted that plaintiff had deposited $5,000 by check.

   The Agreement contained a box labeled ‘‘TO BE DELIVERED ON OR ABOUT.’’ Inside the box was written ‘‘ASAP’’ in a handwriting and ink different from that in the rest of the document. Rosenberg testified that he did not write ‘‘ASAP’’ on plaintiff’s order himself. Rather, a salesperson wrote it in the process of ‘‘finishing up’’ the transaction. Rosenberg did not instruct the person to do so, but he routinely delegates to defendant’s employees the processing of customer checks and the dispensing of receipts. Rosenberg stated that the term ‘‘ASAP’’ is used in his business ‘‘in lieu of a stock number. Just line it up in order. As soon as you can get it done, do it.’’ He also testified that ‘‘in the literary form’’ it means as soon as possible. The Agreement contains another box labeled ‘‘STOCK NO.,’’ which was left blank.

   Rosenberg testified that plaintiff was the first person to place an order for a Prowler. Further, Rosenberg was ‘‘pretty sure’’ that plaintiff’s order was the first order on which he received a deposit.

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   Plaintiff testified that his next contact with Rosenberg was on May 11, 1997, when he called Rosenberg to discuss the Prowler’s list price. They agreed that the information they had received was that the manufacturer’s list price would be $39,000.

   On May 23, 1997, Salvatore Palandri entered into a contract with defendant to purchase a 1997 Plymouth Prowler. His contract reflects a purchase price of ‘‘50,000 þ tax þ lic þ doc’’ and a $10,000 deposit. It further states that Palandri would receive the ‘‘first one delivered to [the] dealership.’’ Palandri testified that he wrote a check for his deposit on the same day that he entered into the contract. Palandri stated that his initial discussions with Rosenberg about the Prowler, however, occurred about one to three months before the contract date.

   Plaintiff testified that the next conversation that the parties had occurred on August 11, 1997. Plaintiff stated that Rosenberg informed plaintiff that no Prowlers would be delivered to the Midwest and that he would be returning plaintiff’s check. Plaintiff requested assurance that, should defendant receive a vehicle, it would be his. Rosenberg said that it would. Plaintiff then requested assurance in writing, and Rosenberg stated that he would check with his brother. He also indicated that he was not certain that plaintiff was the first person who had a contract for a Prowler.

   Rosenberg testified about this conversation as follows. Plaintiff inquired whether defendant would receive any cars and he replied that he had ‘‘no guarantees at this time.’’ Rosenberg never understood that no Prowlers would be delivered to the Midwest. The conversation consisted of nothing more than this discussion. Rosenberg denied having stated whether the car belonged to plaintiff or that he would have to check with his brother.

   Plaintiff testified that he called several dealers to check on the availability of Prowlers. He believed that he was the first customer to place an order for a Prowler because plaintiff and Rosenberg had to discuss the potential list price for the vehicle.

   Plaintiff testified that he called Rosenberg on September 5 to inquire if Rosenberg had received any additional information about the Prowler. Rosenberg indicated that he had not. Plaintiff then asked for confirmation that if defendant received a car it would be allocated to plaintiff, and Rosenberg stated that it would. Plaintiff stated that Rosenberg did not mention a contract with Palandri.

   Plaintiff next testified that he attended a Chrysler customer appreciation event at Great America on September 19 and spoke to a company representative about the Prowler. Two days later, the representative sent him a fax that contained a tentative list of dealers who were to receive Prowlers. Defendant’s name was on the list.

   Plaintiff testified that he called Rosenberg on September 22 to notify him that his dealership was on a list of dealers due to receive Prowlers. Rosenberg informed plaintiff that he would not sell plaintiff a car because plaintiff had gone behind Rosenberg’s back and that contacting Chrysler would cause Rosenberg problems. Rosenberg also stated that plaintiff was not the first person with whom he contracted to sell a Prowler. Plaintiff protested and Rosenberg informed him that he did not sign the contract and would not sell plaintiff the car. Based on this and previous conversations with Rosenberg, plaintiff did not believe that he would be able to purchase a Prowler from defendant.

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   Beginning on September 23, 1997, plaintiff contacted 38 Chrysler-Plymouth dealerships to inquire about purchasing a 1997 Prowler, but did not obtain one. Plaintiff had ‘‘serious doubts’’ about whether Rosenberg would deliver to him a Prowler.

   On October 24, 1997, plaintiff attended a Prowler coming-out party at the Hard Rock Cafe and saw a purple Prowler in the parking lot with a sign in its window that had defendant’s name written on it. On October 25, plaintiff went to defendant’s showroom and saw a Prowler parked there. He found Rosenberg and informed him that he was there to pick up his car. Rosenberg stated that he was not going to sell plaintiff the car and that he did not want to do business with him. Later that day, plaintiff purchased a Prowler from another dealer for $77,706.

   On October 27, 1997, defendant sold the only Prowler it received in that year to Palandri for a total sale price of $54,859, including his $10,000 deposit.

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   On April 23, 1998, plaintiff sued defendant for breach of contract. * * * 

   Following a bench trial, the court entered judgment for plaintiff and awarded him $29,853 in damages. It concluded that defendant breached the Agreement and that plaintiff properly covered by purchasing a replacement vehicle for $29,853 more than the contract price. Further, the court found that the term ‘‘ASAP’’ ‘‘is not want of meaning’’; that Rosenberg testified that it means ‘‘if and when a car is delivered’’ and ‘‘as soon as something can be done[,] do it.’’ The court found credible plaintiff’s description of at least two conversations with Rosenberg, during which Rosenberg confirmed that, if defendant took delivery of a purple Prowler, it would be sold to plaintiff. It concluded that delivery of a Prowler was to be as soon as possible and that defendant was on the road to repudiating the contract when it entered into a contract with Palandri in May 1997. The trial court also concluded that defendant repudiated its contract in September and October of 1997 when Rosenberg told plaintiff that he would not sell him a car. It found plaintiff ‘‘ready, willing, and able to perform the contract.’’ The court found that the price plaintiff paid for the car at another dealership was the best price he could receive for a Prowler after Rosenberg’s refusal to sell to him a car.

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   Defendant argues that the trial court erred in finding that defendant repudiated the Agreement. First, defendant takes issue with the trial court’s finding that defendant was ‘‘on its way’’ to repudiating the Agreement when it contracted with Palandri in May 1997 to deliver to him the first Prowler. Defendant asserts that the court’s reasoning was flawed because, in May, defendant did not know whether any Prowlers would be produced in that year. Thus, defendant could not have been on the road to repudiating the Agreement. Second, defendant contends that the court’s finding that it repudiated the contract in September and October of 1997 also was error because it relied on plaintiff’s contradictory, and therefore incredible, testimony. Defendant points to plaintiff’s testimony that he had doubts that defendant would deliver to him a vehicle and to plaintiff’s testimony that he was willing to purchase more than one Prowler.

   Under the UCC, certain actions by a party to a contract may constitute an anticipatory repudiation of the contract if the actions are sufficiently clear manifestations of an intent not to perform under the contract. [UCC §] 2–610; [citation.]

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Comment 1 to Section 2–610 provides, in relevant part:
Anticipatory repudiation centers upon an overt communication of intention or an action which renders performance impossible or demonstrates a clear determination not to continue with performance.
   * * * When such a repudiation substantially impairs the value of the contract, the aggrieved party may at any time resort to his remedies for breach. * * * [UCC §] 2–610, Comment.
Comment 2 to Section 2–610 provides, in relevant part:
It is not necessary for repudiation that performance be made literally and utterly impossible. Repudiation can result from action which reasonably indicates a rejection of the continuing obligation. [UCC §] 2–610, Comment.

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   Upon learning that defendant was on a tentative list to receive a Prowler, plaintiff testified that he called Rosenberg to relate the information and that Rosenberg responded that plaintiff was not the first person to contract to purchase a Prowler. Rosenberg also stated that he would not do business with plaintiff. Further, Rosenberg’s testimony about this conversation corroborated plaintiff’s, in that Rosenberg stated that he told plaintiff that the vehicle was already ‘‘committed.’’ The trial court also heard both plaintiff and Rosenberg testify that, when plaintiff went to defendant’s showroom on October 25 and informed Rosenberg that he was there to pick up his car, Rosenberg told plaintiff that he did not want to do business with him.

   We conclude that the trial court did not err in finding that defendant’s foregoing actions reasonably indicated to plaintiff that defendant would not deliver to him a Prowler under the Agreement. * * *

   * * * With respect to plaintiff’s actions, section 2–610(b) of the UCC provides that an aggrieved party may ‘‘resort to any remedy for breach’’ of the contract ‘‘even though he has notified the repudiating party that he would await the latter’s performance.’’ [UCC §] 2–610(b). One such remedy is to cover. [UCC §] 2–711(1)(a) (buyer may effect cover, upon seller’s repudiation, whether or not buyer cancels the contract). The statute is clear that a buyer’s willingness to proceed with performance under a contract does not excuse a repudiation. * * *

   Defendant next asserts that, even if there was a repudiation in September or October of 1997, plaintiff did nothing to indicate that he thought this was the case. He took no self-help measures such as: terminating the contract; seeking to enjoin the sale to Palandri; requesting a retraction; or suspending his performance obligations. Again, we disagree. The UCC does not require a party to request assurances as a condition precedent to recovery. [Citation.]

   For the foregoing reasons, we conclude that the trial court’s finding of repudiation was not against the manifest weight of the evidence.

***

   * * * [T]he judgment of the circuit court of McHenry County is affirmed.

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Smith and Roberson Business Law

ISBN: 978-0538473637

15th Edition

Authors: Richard A. Mann, Barry S. Roberts

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