Question

CONTEMPORARY CANADIAN BUSINESS LAW : Chapter 15, Page 283, Case 10

The Acme Company, which frequently acted as agents for sea food processors and buyers, was contacted by the Gourmet Fish Company to find a supply of a particular fish for its new product line. Under the terms of the agreement, the Acme Company was entitled to a flat commission rate based upon the quantity of fish purchased. The Acme Company contacted several fish-processing plants and arranged for each to supply a quantity of the fish species required by the Gourmet Fish Company. In each case, the Acme Company charged the processing plant a $3,000 fee for arranging the supply contract. In due course, the fish were delivered to Gourmet Fish Company, and the agreed-upon commission was paid to the Acme Company, based upon the quantity of fish supplied. Sometime later, when the Gourmet Fish Company discovered that the Acme Company also charged a fee to the processing plant for arranging the supply contracts, it took legal action against the Acme Company. Discuss the nature of the claim that would be made by the Gourmet Fish Company and the defences, if any, of the Acme Company. Render a decision.

Answer 1

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Discuss the nature of the claim that would be made by the Gourmet Fish Company and the defences, if any, of the Acme Company. Render a decision.

Contract 1: Acme Company & the processing plant

Acme had a contract with the processing plant where it will charge $ 3,000 fee for arranging the supply contract . It was mutual agreed upon and both parties delivered on their respective obligations.

Contract 2: Acme Company & Gourmet Fish Company

Acme and Gourmet Fish had a contract where Acme would procure fish supplies for Gourmet Fish and gourmet fish would pay lat commission rate based upon the quantity of fish purchased. It was a mutually agreed upon and both parties delivered on their respective obligations.

Gourmet Fish took a legal action against Acme when they get to know about contract 1. Gourmet Fish would have taken the action on the basis of Acme charging Double Fees from Buyers and Suppliers. If Acme had already charged the processing plant for arranging the supply contract then Acme shouldn't have charged commission from Gourmet FIsh for the same service.

However, Contract 1 and contract 2 were exclusive and binding contracts. None of the contracts were breached and Acme complied on its obligations in both the scenarios. Hence Gourmet Fish has no ground to bring any legal action against Acme COmpany.