[B] Witham tendered successfully for the supply of coal to the Great Northern over a period on one year. In his tender, Witham undertook to supply such quantities as Great Northern may order from time to time. Assume that the tender was on Feb 15, the winner was announced onMarch 15 and the obligations pursuant to the tender began on April 1. Suppose that on June 15, Witham informed Great Northern of intent to opt out and 8 days later Great Northern received the registered letter to that effect.. Suppose that Great Northern placed the following orders on Witham on the following dates:
Date of Order Coal (tons)
April 12 25,000
May 3 75,000
June 18 45,000
June 30 100,000
July 15 85,000
August 12 65,000
Sept 5 85,000
Sept 15 35,000
Oct 8 110,000
If in the tender the opt out notice period is stipulated as two weeks from date of the receipt by the tender awarder as evidenced by return receipt:
q1 On what date will obligations of the tender awardee cease pursuant to the opt out? ___________ (date) [ILO A1] (1 ½ marks)
q2 How many tons will the tender awardee be obligated to supply the tender awarder? ____________ (number) [ILO B2] (1 ½ marks)
q3 Assume that the tender awarder supplied no coal to the tender awardee and plans to sue the tender awarder. How much ordinary damages is the tender awarder likely to be awarded if, in 1873, the price of anthracite coal in the market (PM) was $4.27 but in the tender the price was stipulated contract price (PK) of $3.77 for that year.