Tiny Tim Toy Company (TTT) entered into a contract with the manufacturing firm of Charles, Dickens, and Scrooge (C,D&S) to purchase Christmas toys. The shipment was due to arrive on September 1, in time for the Christmas sales. By August 15, after
hearing from other toy companies that C,D&S were falling far behind on meeting delivery dates, TTT wrote a letter demanding assurances that the goods would arrive as scheduled. The only response received was a letter on C,D&S letterhead that said, "Bah Humbug! You'll get the shipment by November 1." Discuss TTT's possible remedies at this point.
When one party has reasonable doubt about the other party's performance, the Code allows the insecure party to demand written assurances of performance from the other party. It seems that TTT's concerns are reasonable in light of the information received. Until a response is received, performance may be suspended by TTT. Once TTT received the response from C,D&S, the delivery date change repudiated the contract. C,D&S knows that time is of the essence because of retail industry standards. TTT may: 1) wait until September 1, hoping for a timely shipment; 2) resort to any remedy for breach of contract such as cover and a suit for damages; and 3) suspend its own performance.
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