Woogles Inc Manufactured Widgets in Winnipeg

question 20

Essay

Woogles Inc manufactured widgets in Winnipeg.It contractually agreed to sell 5000 widgets to Peja in Halifax for a price of $100 000.Because the Province of Manitoba is concerned about the export of widgets, it requires all such sales to be licenced.Such licences are easily obtained if the seller fills out a simple application form.Because of that requirement, the contract between Woogles and Peja contained a clause that said, "Performance of this agreement is conditional upon the acquisition of an export licence." Shortly after entering into its contract with Peja, Woogles received an offer from another buyer, who was located within Manitoba, to pay $125 000 for 5000 widgets.Woogles accepted that offer, even though it only had a total of 5000 widgets to sell.It then simply refused to apply for the export licence that was necessary for its contract with Peja.Can Woogles escape all responsibility to Peja in that way? Explain your answer.

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Definitions:

Merchandise

Goods or products that are bought and sold by businesses in the course of trade.

Credit Terms

Conditions under which a seller extends credit to a buyer, including payment deadlines and interest rates.

Discount Period

The time frame during which a payment can be made at a reduced rate before the full amount becomes due.

Annual Interest

The total amount of interest payable or receivable over one year, depending on whether the context is savings, investment, or a loan.