Alan works as a clerical assistant in the team responsible for managing orders forperishable food. The weeks before Christmas are a particularly busy time for the teamas the volume of perishable food to be ordered and distributed to the stores issignificantly higher. One day in early December, several members of the team were toounwell to work, and so Patricia, the team leader, asked Alan to verify the orders thatwere arriving at the warehouse. As he was doing so, he took a phone call from Todd atTurkeydelight Ltd, asking whether Supasave had decided on this year’s turkey order.Patricia was not in the office, but Alan had noticed a reference to “turkey order as before”on a spreadsheet, and so Alan told Todd that Supasave would order 10,000 turkeys forthe week before Christmas. This was in line with orders in previous years. However,Supasave had decided that they would change suppliers this year and get their turkeysfrom Perfectpoultry Ltd instead. When Turkeydelight’s delivery lorries arrived at thewarehouse on 17 December, Patricia told them that they had already taken delivery ofthe turkeys from Perfectpoultry and that Supasave had not intended to place an orderwith Turkeydelight. The lorries returned to Turkeydelight’s coldstore, but by then therewas insufficient space for all the turkeys and Turkeydelight had to hire two large freezercontainers to store the turkeys to prevent them from going off. Turkeydelight insists thatit has a contract with Supasave for 10,000 turkeys and that it is entitled for compensationbecause Supasave refused to take delivery and because it had to acquire additionalstorage facilities to keep the turkeys. Turkeydelight was able to resell most of the turkeysat a lower price to Ladle, a discount grocery chain.
Advise Supasave on
(i) whether Alan’s actions have resulted in a binding contractbetween Supasave and Turkeydelight; and
(ii) assuming that there was a contract,whether Supasave is liable to pay compensation and for what.
Cant see any point apart from law of agency, buyer's liability and seller remedies....many thanks!!!
Commercial/Business/Contract Law on Agency Relationship!
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