QST LA 245 Lecture Notes - Lecture 11: American Express, Commercial Paper, Negotiable Instrument
Document Summary
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.