Summary of Tongish v. Thomas
Supreme Court of Kansas, 1992.
Facts: D, a farmer, made a K with P to sell his sunflower seeds. P had a K to deliver the seeds to Bambino Bean & Seed for the price it paid to D plus 55 cents handling charge, P’s only profit. Due to some circumstances, the sunflower seed price went up dramatically and D refused to deliver the seeds to P.
Procedure: The trial court awarded P only the loss of handling charges in the amount of $455. The Court of Appeals reversed and ruled that P should be awarded damages based on market price under UCC 2-713 (Difference between market price and K price).
Issue: Did damages rule of UCC 2-713 apply to this case?
Rationale: According to the court, awarding only profit damages to P would encourage breaches of Ks in the marketplace. While the application of 2-713 may not reflect the actual loss to a buyer, it encourages a more efficient market and discourages the breach of Ks. Affirmed.