Tongish v. Thomas

Tongish v. Thomas

1992 Kansas Supreme Court

• Tongish, farmer, was going to sell seeds at $13 for large and $8 for small.
• Market price increased over contract price. Tongish breached contract and sold to another buyer at higher price.
• Original buyer (Coop) was going to resell seeds with small handling fee to another party.
• Buyer was awarded $455 in damages, based on its loss of handling charges.
• Buyer wants damages under 2-713, which would award it difference between market price and contract price.
• Seller’s conduct in this case, as contrasted with Allied case, was more culpable–court is more willing to assign greater damages based on market prices because Tongish’s breach of contract was more intentional.

• ‘Permanent Editorial Board’ of UCC: current comments to 2-713 suggest that, where buyer has covered, court should use cover as remedy.
• Case where buyer does not cover immediately, but does over time: 2-712 talks about covering without unreasonable delay. Courts will generally still permit market damages.
• Market based damages are usually fixed at time buyer learns of breach rather than when contract would have been performed (time of tender).
• UCC was drafted with idea that often the buyer would learn of breach after time of tender, thus damage calculation would go back to time of tender. See UCC 2-723. Also, analogous seller’s remedies ( 2-706, 2-708): market-based damages that seller gets are at time and place for tender.
• Statute on its face, however, assesses damages when the buyer learned of breach.
• Llewelyn may have meant that damages should be assessed whenever buyer learns of breach, regardless of whether it is after time of tender.

• Three Mitigations on Damages ? Non-aggrieved party must be avoid intentionally increasing damages
? Damages must be foreseeable
? Damages must be calculable with some degree of certainty

Conclusion

Notes

See Also

References and Further Reading

About the Author/s and Reviewer/s

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