Owen buys a used Prius from Quality Motors, Inc., paying $1,000 down and agreeing to pay off the balance in thirty-six monthly payments of $200 each. The terms of the agreement call for Owen to make a payment on or before the first of each month, beginning March 1. During the first six months, Quality receives a $200 payment before the first of each month. Starting in September, however, and continuing for the subsequent five months, Owen's payment is never made until the fifth of the month. Quality accepts and cashes the payment check each time. Before the next payment is due, Quality decides that it is no longer willing to accept late payments. Can Quality sue Owen immediately for breach? Can Owen continue to make late payments without liability? Explain.
What will be an ideal response?
The dispute between these parties turns on whether Quality's acceptance of six late payments constitutes a waiver of Owen's agreement to pay on or before the first of each month. When a nonbreaching party waives the breach, he or she relinquishes the legal right to claim failure of full performance. Quality's acceptance of six late payments not only constitutes a waiver but also constitutes a pattern of conduct of waiver, and thus the waiver extends to the thirteenth and future payments¾until such time as Quality gives notice to Owen that full compliance with the contract will be required in the future. Quality cannot immediately hold liable Owen for breach on the late thirteenth payment but can notify Owen that any further tender of late payments will constitute a breach. In other words, on notice from Quality, Owen can no longer make late payments without liability.
You might also like to view...
A stock’s dividend yield is calculated as the:
A. annual dividend received per share divided by the book value per share of stock. B. book value per share of stock divided by the annual dividend received per share. C. annual dividend received per share divided by the market price per share of stock. D. market price per share of stock divided by the annual dividend received per share. E. earnings remaining after paying preferred dividends divided by the number of common shares outstanding.
A mixed cost will be an effective cost driver
Indicate whether the statement is true or false
Analysts deciding between investments must consider the comparative risks. Which of the following factors affect the risk of business firms?
a. Economy-wide factors, such as increased inflation or interest rates, unemployment, and recessions. b. Industry-wide factors, such as increased competition, lack of availability of raw materials, changes in technology, and increased government regulatory actions, such as anti-trust or clean environment policies. c. Firm-specific factors, such as labor strikes, loss of facilities due to fire or other casualty, and poor health of key managerial personnel. d. The amount of liquid resources available to the firm to run smoothly and effectively. e. all of the above
________ are people whose names you know, whom you see occasionally and of whom you may know little about even if you've known them for a long time.
A. Companions B. Intimate friends C. Acquaintances D. Strategic alliances E. Friends