I need an explanation for this Business Law question to help me study.
Read the Case Campbell Soup Co. v. Wentz in the text. Answer the following questions:
Facts: Per a written contract betweenCampbell Soup Company (a New Jersey company) and the Wentzes (carrot farmers inPennsylvania), the Wentzes would deliver toCampbell all the Chantenay red cored carrots to be grown on the Wentz farm duringthe 1947 season. The contract price for the carrots was $30 per ton. The contract betweenCampbell Soup and all sellers of carrotswas drafted byCampbell and it had a provision that prohibited farmers/sellers from selling their carrots to anyone else, exceptthose carrots that were rejected byCampbell. The contract also had a liquidated damages provision of $50 per ton if the sellerbreached, but it had no similar provision in the eventCampbell breached. The contract not only allowedCampbell to rejectnonconforming carrots, but gaveCampbell the right to determine who could buy the carrots it had rejected. The Wentzes harvested100 tons of carrots, but because the market price at the time of harvesting was $90 per ton for these rare carrots, the Wentzesrefused to deliver them toCampbell and sold 62 tons of their carrots to a farmer who sold some of those carrots toCampbell.Campbell sued the Wentzes, asking for the court’s order to stop further sale of the contracted carrots to others and to compelspecific performance of the contract. The trial court ruled for the Wentzes andCampbell appealed.
Issues: Is specific performance an appropriate legal remedy in this case or is the contract unconscionable?
Discussion: In January 1948, it was virtually impossible to obtain Chantenay carrots in the open market.Campbell used Chantenaycarrots (which are easier to process for soup making than other carrots) in large quantities and furnishes the seeds to farmerswith whom it contracts.Campbell contracted for carrots long ahead, and farmers entered into the contract willingly. If the facts ofthis case were this simple, specific performance should have been granted.
However, the problem is with the contract itself, which was one-sided. According to the appellate court, the most direct example ofunconscionability was the provision that, under certain circumstances,Campbell may reject carrots, but farmers cannot sell themanywhere withoutCampbell’s permission. Though the contract was legal, it was wrong forCampbell to ask for the court’s help inenforcing this unconscionable bargain (one that “shocks the conscience of the court”). The court said that the sum of the contract’sprovisions “drives too hard a bargain for a court of conscience to assist.”
Holding: The judgment of the trial court in favor of the farmers is affirmed.
Read the Ace Heating and Cooling scenario in your text and answer the following questions:
AceHeating and Cooling sells air conditioners. One unit, the Freezy, has a fair market value of $300. During a heat wave,Ace sells a Freezy air conditioner for $500 to each of the following: