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Pelham runs a breakfast café famous for their generous egg d…

Posted byAnonymous April 30, 2026April 30, 2026

Questions

Pelhаm runs а breаkfast café famоus fоr their generоus egg dishes. Pelham always uses fresh organic jumbo eggs from free range chickens hereafter, just “eggs”). When Pelham’s regular egg source retires, Pelham needed a new egg supplier. After some searching. Pelham found Douglas Eggs, an egg farm owned by Douglas that could supply the steady stream of eggs Pelham needed for his restaurant. Pelham needs an average of 400 eggs each day to make breakfast for 100 people paying $10 each for breakfast. Pelham’s café is open 5 days each week. Douglas and Pelham discussed a possible agreement over the phone. In the phone discussion both agreed that they would formalize their tentative agreement with a written contract. Pelham explained that he needed 400 eggs delivered every day at 5:00 AM. Douglas said he wanted 25 cents for each egg. Pelham said that seemed high, but he would see how good the eggs were. Pelham said he needed some kind of a guarantee that the delivery of the eggs would occur. He noted that he would lose $1,000 every day he had no eggs. Pelham also insited that the price needed to last for the whole year. Douglas sent Pelham a written order form Douglas prepared. The order form said Pelham was ordering 400 eggs delivered every day at 5:00 AM. Upon delivery each day Pelham was to give the delivery driver a check for $100. This arrangement would occur on each of the five days a week Pelham’s was open for the next 12 months. On the back there was a lot of boilerplate language. This included a clause that said “This written agreement is the full and only agreement of the parties and supersedes all other discussions or negotiations.” It also included a clause that said “The seller retains the right to raise prices periodically with one week’s notice.” Pelham crossed out this last clause and wrote in a new clause on the form. It read: “If eggs are not delivered in a timely manner each day Douglas shall pay Pelham $1,000 a day for every day there is no delivery. This is meant to be liquidated damages. Because lost profits can be difficult to prove the parties stipulate that these shall be the damages if Douglas does not deliver as promised. Pelham does not agree to the terms of this contract unless this clause is agreed to and counter-signed by Douglas and no additional changes are made in the terms of our agreement. Pelham initialed the new handwritten clause and signed the purchase order. Pelham mailed the signed modified order and hand delivered it to Douglas’ office. Douglas was out, but Pelham left the purchase order with Douglas’ secretary. An hour later Pelham called Douglas and asked if he had signed the contract. Douglas said that he had signed and the first shipment of eggs would be there in the morning. Things when well for the first month. At the start of the second month the eggs did not arrive. Douglas did not answer Pelham’s calls. The restaurant was classed for three days without eggs. By the fourth day Pelham was able to line up a new contract with another egg supplier for 30 cents an egg for eggs for the rest of the year. Pelham sues Douglas, who claims he did not really sign the purchase order. Discuss.

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