Cheap And Save Food Stores Limited Pricing Error Decision
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Cheap And Save Food Stores Limited regularly purchased large quantities of strawberries for its bulk food section from a Canadian food wholesaler. The purchase of strawberries was carried out with a separate purchase order and invoice each time although a full, written contract had been executed between the parties governing the relationship in its entirety. One of the terms of the contract specified that for individual orders in excess of 100 kg, a quantity discount of 15% would be applied to the purchase price. Since these were very favourable terms, Cheap And Save regularly ordered quantities ranging between 500-700 kg of strawberries to adequately supply all of its stores. After it had been purchasing strawberries for over a year, Cheap And Save received a note attached to its most recent invoice informing it that the contract was in error. The wholesaler's policy was that only purchases in excess of 1000 kg were entitled to the quantity discount of 15%. The invoice showed the full amount owing for the most recent purchase of 650 kg with no discount applied and also a cumulative amount equal to the 15% discount which had been granted to Cheap And Save on all previous orders. Cheap And Save refused to pay the extra amount.
Discuss the arguments which may be raised by the parties. Render a decision.
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Solution Summary
The solution examines the arguments for paying the extra amount.
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Hello,
In my opinion, the canadian food wholesaler is in the wrong. They signed a written contract that stipulates that the discount be applied on orders in excess of 100 kg. It was most probably signed by all parties involved. I see no end date as well.
Therefore, Cheap and Save ...
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