Question: Mud Electric Supply(Mud) agrees to ship 10,000 computer chips at a price of $100 per chip to Dull Computers(Dull) for use in their new laptop

Mud Electric Supply(Mud) agrees to ship 10,000 computer chips at a price of $100 per chip to Dull Computers(Dull) for use in their new laptop computers. The chips are due at Dull's facility in Boston on or before October 1, 2021. The chips arrive at Dull's facility in Boston on September 23, 2021, which was a very busy Friday. Dull's employees check the bill of lading against the quantity marked on the boxes(40 boxes with 250 chips in each box), but do not open the boxes to confirm the label is correct as to the number of chips in each box or their quality. The chips are put into their warehouse and are not needed in the production process until October 10, 2021. When the boxes are opened on October 10, 2021, Dull notices that each box only contains 200 chips and thus their order is short 2000 chips. They have tendered the full price to Mud pursuant their contract. But they also know that the price of chips has fallen to $90 per chip on the open market and would like to return all of the chips and demand their money back. They notify Mud of their intention in writing indicating their delivery was nonconforming(not a perfect tender) and want to rescind the contract. Mud writes back saying they could have cured the problem prior to October 1, 2021, had Dull opened the boxes. They could have overnighted the remaining 2000 chips. Who wins this battle of Mud and Dull? Explain your answer. To assist in your analysis re-read the JOC OIL v. CONSOLIDATED EDISON CASE, which is in the Mini-Lecture on the right to cure. I will attach it here as well for you.

Step by Step Solution

There are 3 Steps involved in it

1 Expert Approved Answer
Step: 1 Unlock blur-text-image
Question Has Been Solved by an Expert!

Get step-by-step solutions from verified subject matter experts

Step: 2 Unlock
Step: 3 Unlock

Students Have Also Explored These Related General Management Questions!