Law School Case Brief
Kunian v. Dev. Corp. of Am. - 165 Conn. 300, 334 A.2d 427 (1973)
Where a plaintiff had "reasonable grounds for insecurity," it justifiably informed a defendant that it would deliver the balance of the material only if payment of the entire contract was guaranteed by the defendant's depositing sufficient cash in escrow to pay for the delivered materials. The defendant's failure, therefore, to provide adequate assurance of due performance within a reasonable time after the request and after the action had been brought was a repudiation of the contract and the plaintiff was excused from further performance under the contract. Conn. Gen. Stat. § 42a-2-609(1), (4).
Plaintiff supplier, A. Merowitz and Company, Inc. (Merowitz), entered into an installment contract with defendant builder, Development Corporation of America (DCA). The contract provided that Merowitz would deliver plumbing goods to DCA at a set price. DCA failed to pay per the contract, and Merowitz continued to deliver. Merowitz placed a condition of payment on DCA in order to receive further deliveries. Merowitz alleged that DCA breached the contract under the Connecticut Commercial Code, Conn. Gen. Stat. §§ 42a-2-101-725. Merowitz also sought the value of the goods and not the price listed on the contract. DCA claimed that Merowitz breached the contract by not delivering and that the contract did not require payments at a set time.
Did DCA breach the contract when it failed to provide payments to Merowitz?
The court held that DCA breached the contract. Because the contract was an installment contract, Merowitz was entitled to repudiate the contract. The court awarded Merowitz damages based on contract price.
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