Assume that the hotel says it will accept the carnations instead of the roses. B

Question

Assume that the hotel says it will accept the carnations instead of the roses. But later in the day, the event host finds out his tables will have carnations instead of roses and puts up a hissy fit, demanding the roses. You get a frantic call from the hotel, demanding that you come pick up the carnations and that you shouldn't expect to get paid.

Has there been substantial impairment to the hotel's contract? Explain.

Assume that the hotel says it's OK to substitute carnations for roses, but on the way to deliver the bouquets, your delivery driver has an accident and the bouquets are destroyed. You've already incurred the cost of production, and the expense of delivery. Do you still have a right to get paid? Explain.

Would your answer be different if the bouquets were destroyed by a fire at the hotel after they were delivered but before the hotel got to use them for the big event? Explain.

What if your contract with the hotel said that you would have the bouquets ready for pick up at your facility because you don't deliver. The hotel calls and asks you to just send them over in a local delivery truck and that the hotel will pay for the cost. The delivery truck then has an accident and the bouquets are destroyed before they are delivered. Whose loss it it?

Explanation / Answer

1. Yes. The hotel and the seller had the sales contract, according to which they agreed to the carnations in place of roses. By asking to take the carnations back, the hotel has violated the contract and is liable to pay for the cost of carnations and other damages incurred as consequences.

2. No. The accident was one of the risks associated with the process of delivery to the customer and the risk lies with vendor only. The hotel is not liable for payment as it has not received any product, thus the condition of delivery ( or transfer of title), which has to be fulfilled prior to the payment was not satisfied.

If the roses were destroyed at the hotel, the risk was transferred with the transer of title to the hotel. In this case, hotel will have to pay for the cost of roses.

3. In this case the seller's liability ceases the moment goods leaves its premises. Since the hotel is responsible for pick up and if it asks the seller to send it through any means, the risk is now with the hotel, who is to suffer the damages.

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