QST LA 245 Lecture Notes - Lecture 11: American Express, Commercial Paper, Negotiable Instrument
17 Aug 2018
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The smith wanted to raise emus to sell for meat, oil, leather, feathers, etc. Paid tomie, manager of penbridge farms, ,000 down payment to breed a boy and girl emu. Assured the smiths that they are a proven male and female breeder pair, and had produced chicks in the previous breeding season. Did not produce chicks because they were 2 males. Donna smith performed procedure and found out it was 2 males. Breeder did not give back money, so they sued. Trial judge ordered ,000 on lost profits, penbridge appealed saying the buyer cannot count her chicks before they have hatched. Consequential: higher costs, such as expected profits. Court says they can recover consequential damages as long as they can calculate it in a reasonable format. Issue of good faith: penbridge farms did not act in good faith because they knew how to determine gender, but failed to do so, also lied that the emus had reproduced.
