contract law

contract law Order Description Due Date Monday 15th August 2016 Electronic copy to be submitted on ‘Turnitin’ before 2pm Word limit: 2500 words Remember to: 1. Follow the Law School Guidance on referencing and citation in order to avoid problems with Unfair Practice (copies of this are available on Blackboard); 2. Follow the correct submission procedures and submit on time. (Extensions will only be granted in exceptional circumstances.) See Blackboard for details. Widget plc. manufactures widgets. They contracted with Machine plc. for Machine plc. to supply them with a new widget manufacturing machine. It is to replace one of Widget’s older machines and will increase the number of widgets that they can manufacture each week. Machine plc. usually make their customer’s sign their standard form contract terms, before a contract is made, but on this occasion, the contract was made on the telephone, with Machine’s standard terms being posted to Widget shortly afterwards. Widget had purchased a widget manufacturing machine from Machine on seven previous occasions. On those previous occasions Widget had signed Machine’s standard form at the time of contracting. In breach of contract, Machine was five weeks late in delivering the new widget manufacturing machine to Widget. Widgets are in high demand and Widget can sell all it produces. It could have made more ordinary sales, and more ordinary profit, of £2,000 a week if Machine had delivered the new machine on time. Also, during those weeks, Widget could have taken on an unusually profitable contract for the urgent supply of widgets overseas, and increased their additional profit to £5,000 per week, for two weeks, if it had had the extra capacity which the new machine would have provided. Machine plc. has a clause in its standard terms which states: ‘Damages for any delay in delivery are limited to £100 a week, for each week of delay.’ Machine plc. is a very large business, and Widget plc. is a small business. Machine plc. sometimes settles claims for damages for breach from its customers for sums in excess of the limitations in its standard terms, but only with businesses which are much larger than Widget plc. Advise Widget plc.)