Question from business law?

Question

All Seasons, Inc. ordered $5,000 worth of Christmas decorations from Santa, Inc. The shipment of decorations was to arrive no later than October 1, in time for the Christmas season. The shipment did not arrive until December 1. In spite of the delay, All Seasons covered a third of the order through other suppliers, but had to pay 15% more than the price under contract with Santa, Inc. As a further result of the delay, All Seasons' sales were down 25%. All Seasons can recover:

A/punitive damages.

B/nominal damages.

C/compensatory damages and consequential damages.

D/compensatory damages, consequential damages, and punitive damages.

Answer 1

You have placed this in the wrong thread.  There is an answer, however, you have not supplied enough information pertaining to the order agreement.  In such cases the buyer can recover certain loss brought on by the supplier being late to supply the products.

Answer 2

Probably nothing.  If Santa Inc is smart, they tell there customers that they are not responsible for lost revenues due to shipping delays, acts of God, etc.

That being the case, All Seasons is SOL.

In real life, there is not a quick answer.  After all, what are you going to do because a monsoon sinks the cargo freighter coming from China with your order on it.  Or, the Chinese factory shuts down for 30 days to celebrate Chinese New Year.

In business, stuff happens.  

Santa Inc did not force All Seasons to pay 15% more, All Seasons chose to pay it.  It is the result of low bid suppliers.

But since you asked a question, the answer (in my non-lawyer opinion) would be B.  But it is obvious your professer has never owned a business where he had to sell stuff and get stuck by a supplier.