Sales and Leases - A Problem-based Approach, 2016a

[The court also rejected Bobby Murray’s argument that government regulations requiring
reduced emissions excused its performance of the contract, noting that Bobby Murray, by terms
of the parties' agreement, accepted responsibility for keeping abreast of governmental regulations
bearing upon the contract.]
Case Notes:
1. As noted in the case, if it is your intent to allow your client to walk away from its
obligations under a contract if your client’s intended source of supply dries up, it is very
important to insert a clause in the agreement to that effect. Even then, as noted in
Comment 5, the seller must employ “all due measures to assure himself that his source
will not fail.”
2. Courts have come to varied conclusions about whether crop failures are foreseeable. In
Cliffstar Corp. v. Riverbend Prod., Inc., 750 F. Supp. 81 (W.D.N.Y. 1990), the court
reversed a summary judgment opinion that a tomato crop failure was foreseeable, and
remanded for a jury trial. In Clark v. Wallace County Cooperative Equity Exchange, 986
P.2d 391 (Kan. Ct. App. 1999), the court ruled that a corn crop failure was not sufficient
to excuse a seller from delivering the agreed-upon amount of corn.
Lawrance v. Elmore Bean Warehouse
702 P.2d 930 (Id. App. 1985)
Appellant Elmore Bean Warehouse, Inc., had contracted to purchase pinto beans from a
grower, Lawrance, at a fixed price. When the market price of the beans dropped dramatically
below the contract price, Elmore attempted to avoid paying the agreed price for the beans on the
grounds of "commercial impracticability." The grower sued in the magistrate division and
recovered judgment for the balance due on the contract. Elmore appealed from the judgment to
the district court, but was unsuccessful there. A second appeal was taken to this court. We agree
with the two prior decisions holding that the doctrine of "commercial impracticability" is not an
avenue by which Elmore can escape its contractual obligation. We affirm the order of the district
court.
On May 14, 1981, a representative from Elmore Bean Warehouse (hereinafter referred to
as Elmore) approached Lawrance about growing pinto bean seed. That day a written contract was
entered into by the parties whereby Lawrance agreed to grow and sell to Elmore eighteen and a
half acres of pinto beans and Elmore agreed in turn to pay $ 25 per hundredweight for the beans
if they were of commercial quality. An additional $ 3 per hundredweight was to be paid when the
pinto beans were certified and another $ 2 per hundredweight was to be added if Lawrance
waited until February 15, 1982 for payment.
That fall Lawrance harvested and delivered 240 hundredweight "sacks" of beans. The
beans were accepted by Elmore and remained in Elmore's possession. By the fall of 1981 the
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