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Contracts Keyed to Ayres
Austin Instrument, Inc. v. Loral Corp.
Citation:29 N.Y.2d 124.
ProfessorMelissa A. Hale
CaseCast™ – "What you need to know"
The defendant was awarded a contract with the Navy for the production of radar sets.The sets needed specific parts and the defendant awarded the plaintiff a contract to produce approximately half of the parts. The defendant was later awarded a second contract for sets and went around soliciting bids for the contracts for the parts. The plaintiff bid on the contracts, but a representative for the defendant told the plaintiff that they would only be awarded the contracts where they were the lowest bidder. The plaintiff refused to accept an order for less than all of the parts and told the defendant that they would cease deliveries under the first contract until the defendant agreed to price increases for parts due under the first contract and placed with the plaintiff the order for all of the parts needed for the second contract. The defendant tried to find other manufacturers but couldn’t and then the acceded to the plaintiff’s demands. After the plaintiff’s last delivery under the second contract, the plaintiff sued the defendant for the excess amount owed on the second subcontract. On the same day, the defendant sued the plaintiff claiming damages in the sum of the price increases under the first subcontract.
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