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time to fulfill the contract. Finally, between June and October of year two, the manufacturer delivered everything the contract obligated it to. The firm never complained of any delays until October, indicating the firm’s belief that things were proceeding at a reasonable pace. On similar facts, an appellate court found that the manufacturer performed within a reasonable time. [ Adapted from Inter-Americas Ins. Corp., Inc. v. Imaging Solutions Co. , 185 P.3d 963 (Kan. App. Ct. 2008).] b. Contract of Indefinite Duration Calling for Successive Performances A contract may call for successive performances ( e.g. , a contract calling for delivery of a specified number of commercial units per month) but be of indefinite duration. Here, the contract is valid for a reasonable time. However, unless otherwise agreed, either party may terminate the contract at any time. Oftentimes, the contract will continue until one party terminates it. Sometimes, though, the contract may terminate of its own force, as when the parties have for some time been inactive in performing. As perpetual contracts are disfavored, if the language on duration is ambiguous, courts will generally deem the contract to be one of indefinite duration. [U.C.C. § 2-309(2), cmt. 7 (1951); 2 Hawkland UCC Series § 2-309:2, Westlaw (database updated June 2021).] 6. Notice of Termination Special rules apply if one party terminates the contract, except on the happening of an agreed event. Here, the other party must receive reasonable notification of the termination, and any agreement doing away with a notice obligation is invalid if, in operation, it would be unconscionable. Notification is reasonable, in turn, if it gives the party receiving notice a reasonable time to procure a substitute contract. Of course, no notification is needed if termination is to be upon an agreed event, and that event occurs. And if the contract specifies a process for notice of termination, the parties should follow that process. [U.C.C. § 2-309(3) (1951); 2 Hawkland UCC Series § 2-309:3, Westlaw (database updated June 2021); Coburn Supply Co., Inc. v. Kohler Co. , 342 F.3d 372 (5th Cir. 2003).] Example : A manufacturer of faucets and related products contracted with a distributor to market and sell the manufacturer’s products within a specified geographic area. The relationship was at- will, though it continued for roughly six decades, renegotiated annually. But on September 17 of year 60, the manufacturer provided notice to the distributor that the manufacturer intended to terminate the contract, effective December 31 of that same year—105 days’ notice. During that time, the distributer successfully arranged to market and sell a competing manufacturer’s products. Here, the manufacturer gave the distributor reasonable notice of the termination, as during the 105-day notice period, the distributor in fact procured a substitute agreement. [ Coburn Supply Co., Inc. v. Kohler Co. , 342 F.3d 372 (5th Cir. 2003).]
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