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Harold and Henry's Hammer Company

Henry's Hammer Company purchased metal from Harold. Harold was an independent contractor who sold different types of the best metal in the state. Henry's Hammer Company was new to the area. The company's purchasing agents wanted to be sure that the hammers produced by the company would be of the highest quality. The purchase price for the metal was $110,000. Henry's Hammer Company had to borrow this amount from the bank to finance the purchase. The metal was not fit to make hammers. Workers at Henry's Hammer Company realized that the metal did not work well under the heat and pressure conditions required to form hammers from the metal. Henry's Hammer Company did not have any other cash reserves to purchase different metal. Harold had the appropriate metal in stock that could be used to make the hammers. Harold orally promised to replace the metal. Subsequently, Harold realized this metal cost twice as much as the metal that he originally supplied. Harold did not keep his promise. Henry's Hammer Company sued Harold for specific performance of the contract as modified by Harold's promise to replace the metal.

Is specific performance of the contract modified by Henry's oral promise? Discuss why or why not. Explain actions Henry's Hammer Company could take to minimize legal risks associated with sales contracts.
Please site past law cases if one is available for me to reference.

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Step 1
You should understand that specific performance of contract is modified by Harold's oral promise. Written contracts can be modified by oral agreements (See: Krautsack v. Anderson, 329 Ill.App.3d 666, 768 N.E.2d 133, 147, 263 Ill.Dec. 373 (1st Dist. 2002)). However, Henry has to produce evidence in court that Harold had made an oral promise (See: E.A. Cox Co. v. Road Savers International Corp). Even though the original contract was in writing, it can be changed or modified by the words of parties. According to the Uniform Commercial Code parties are prevented from orally modifying a contract only if the parties expressly require that all modifications be in ...

Solution Summary

Specific performance of the contract is discussed step-by-step in this solution. The response also has the sources used.

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