The question (10 marks)
On 1 March, Kirti agrees to supply Prakash 500 metric tonnes of a chemical at Rs 40,000 a tonne, delivery at her Vadodara factory on 1 June. When the contract is made Prakash tells her that he needs the chemical for a fertiliser order he has taken from a state agency at a large margin. Kirti fails to deliver. On 1 June the same chemical is freely available at Vadodara at Rs 46,000 a tonne, but Prakash buys nothing; on 20 June he loses the fertiliser order and the profit on it. He sues for damages for non-delivery and for the profit lost on the fertiliser order. The contract also provides that on any failure to deliver, Kirti shall pay Rs 5 crore. Advise Prakash. (10 marks)
Original problem written for this pack, on the pattern of Module 3 problem questions.
Plan your answer on paper before you look at the authorities — issue first, then the rule, then apply it to these facts.
It tests Unit 3 · Performance, breach and remedies of Law of Contract and Specific Relief.
Authorities you will need
- M/s Murlidhar Chiranjilal v M/s Harishchandra Dwarkadas
- Fateh Chand v Balkishan Das
- M/s Kailash Nath Associates v Delhi Development Authority
How an answer is marked
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