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Contracts Keyed to Scott
National Farmers Organization v. Bartlett & Co., Grain
Facts
National Farmers Organization (Plaintiff) agreed to sell grain to Bartlett & Co., Grain (Defendant) in a series of forty-five contracts. Both parties fully performed under the first thirty-one of these contracts, leaving fourteen at issue. Over the next six contracts, Plaintiff began not fully completing its grain deliveries on time. During this period, Defendant began withholding some payment on grain that actually was delivered “as protection against realized or potential loss caused by failure on [Plaintiff’s] part to perform all contracts not yet fully performed.” About a month later, with eight contracts still due to be performed, Plaintiff informed Defendant that it was ceasing delivery on the outstanding contracts until Defendant made substantial payment for deliveries already made. Defendant treated this communication as an anticipatory repudiation of the remaining eight contracts. Defendant then paid Plaintiff the amount owed on the previous six partial deliveries, setoff by damages due to Plaintiff’s breach of those six contracts, as well as Plaintiff’s anticipatory repudiation of the remaining eight contracts. Plaintiff objected to the setoff with respect to the eight remaining contracts and sued, claiming that its communications to Defendant did not constitute anticipatory repudiation. The trial court found that Plaintiff had repudiated the contracts and found in favor Defendant. Plaintiff appealed.
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