Suppose that the following milestones apply to a hypothetical based on Brodgen v Metro Railway. Brogden supplies coal to Metro on a regular basis. On May 23, Brogden and Metro negotiated a draft concerning the supply of coal. Suppose that the following transactions take place:   ·    April 2: Brogden shipped and Metro received 25,000 tons of coal ·    May 2: Brogden shipped and Metro received 135,000 tons of coal ·    May 22: Brogden shipped and Metro received 55,000 tons of coal ·    June 2: Brodgen shipped but Metro rejected the delivery of 95,000 tons of coal ·    July 2: Brogden shipped but Metro rejected 80,000 tons of coal ·    August 2: Brogden shipped and Metro received 80,000 tons of coal   [1] On what date, if any, does an implied contract between Brogden and Metro come into force? (date) [ILO C1]  [2] What, if any, would be the contractual liability of Metro to Brogden? Answer in aggregate tons:_____ (number) [ILO B1]  [3] What effect, if any, did the event of June 2 have on that contractual liability? Explain in terms of implied contact theory in one sentence only on the lines provided: The event of June 2 has reduced the contractual liability of Metro from 215000 tons to 120000 tons of coal then Metro have to pay the loss of Brogden for that day [ILO C1]  [4a] Identify the theory of the cause of action from the branch “Contracts” for Brogden’s claim against Metro for non-contractual   liability: breach of fiduciary duty (max limit three words)[A1/C1]  [4b] Identify the basis of recovery under that theory:________________________________(max limit three words)[A1]  [5] Using data from [B3] below, determine damages payable using the above-identified theory & recovery basis:______________ (number)

FINANCIAL ACCOUNTING
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ISBN:9781259964947
Author:Libby
Publisher:Libby
Chapter1: Financial Statements And Business Decisions
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     E2

[A] Suppose that the following milestones apply to a hypothetical based on Brodgen v Metro Railway. Brogden supplies coal to Metro on a regular basis. On May 23, Brogden and Metro negotiated a draft concerning the supply of coal.

Suppose that the following transactions take place:

 

·    April 2: Brogden shipped and Metro received 25,000 tons of coal

·    May 2: Brogden shipped and Metro received 135,000 tons of coal

·    May 22: Brogden shipped and Metro received 55,000 tons of coal

·    June 2: Brodgen shipped but Metro rejected the delivery of 95,000 tons of coal

·    July 2: Brogden shipped but Metro rejected 80,000 tons of coal

·    August 2: Brogden shipped and Metro received 80,000 tons of coal

 

[1] On what date, if any, does an implied contract between Brogden and Metro come into force? (date) [ILO C1] 

[2] What, if any, would be the contractual liability of Metro to Brogden? Answer in aggregate tons:_____ (number) [ILO B1] 

[3] What effect, if any, did the event of June 2 have on that contractual liability? Explain in terms of implied contact theory in one sentence only on the lines provided: The event of June 2 has reduced the contractual liability of Metro from 215000 tons to 120000 tons of coal then Metro have to pay the loss of Brogden for that day [ILO C1] 

[4a] Identify the theory of the cause of action from the branch “Contracts” for Brogden’s claim against Metro for non-contractual   liability: breach of fiduciary duty (max limit three words)[A1/C1] 

[4b] Identify the basis of recovery under that theory:________________________________(max limit three words)[A1] 

[5] Using data from [B3] below, determine damages payable using the above-identified theory & recovery basis:______________ (number)                   

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