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Maple Farms, Inc. v. City School District of Elmira

Supreme Court of New York, 76 Misc.2d 1080, 352 N.Y.S.2d 784 (1974)

Presented by Hayes Baker

Case Brief

Facts

The Plaintiff: Maple Farms, Inc.

The Defendant: The City School District of Elmira

Facts

The Contract

On June 15, 1973, the plaintiff and the defendant formed an agreement of a requirements contract. The contract’s purpose was for the plaintiff to supply milk to the defendant for the upcoming school year. The plaintiff would sell milk to the defendant for a fixed price which was the June market price of milk.

The Contract

By December, the market price had risen by 23% of the market price. The plaintiff had many contracts with other surrounding school districts and was at risk to lose a lot of money.

The defendant denied the plaintiff of revocation of the contract. The plaintiff brought an action against the defendant in a New York state court for a declaratory judgment. The plaintiff argued that when they created the contract, they did not anticipate such a drastic price increase in the market price. The plaintiff sues the defendant on the basis of commercial impracticability.

The Plaintiff's Case

Commercial Impractability

Commercial

Impractacbility

A doctrine in contract law that relieves the plaintiff from obligations under a contract that may be granted when performance has been rendered excessively difficult, expensive, or harmful by an unforeseen circumstance.

The Issue

Whether it is commercially impracticable for the plaintiff to perform the requirements contract.

Issues

Ruling

No, the court ruled that the contract was reasonable and that the plaintiff should be held to the contract.

Ruling

Analysis

The court noted that there was recent history of market price fluctuations and inflation that the plaintiff should have been aware of. The plaintiff committed a unilateral mistake which does not release the plaintiff from contract because it was a foreseeable circumstance.

Due to the plaintiff’s poor judgment, the court ruled that the plaintiff must perform on the contract.

Conclusion

Conclusion

The court ruled in favor of the defendant, so that the plaintiff would have to perform on the contract. This was an important case because it stressed the importance of wording in contracts. It is very important to research and apply a plan to all contracts so you can limit any unforeseeable circumstances and ensure quality of contract for all parties.

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