Mid-America Tire, Inc. v. PTZ Trading Limited
Supreme Court of Ohio
768 N.E.2d 619 (2002)
Mid-America Tire (Mid-America) (plaintiff) entered negotiations with PTZ Trading (PTZ) (defendant) to purchase overstock Michelin tires. Negotiations were for winter tires, as PTZ led Mid-America to believe that summer tires would be available at a later time and that PTZ was the sole authorized seller of overstocked Michelin tires. PTZ was, in fact, not an authorized seller and could not sell summer tires in the future. The winter tires to be sold to Mid-America were designated as “DA/2C.” PTZ told Mid-America that 2C meant the tires were stored in two different warehouses, but 2C really meant that the tires could not be sold in the United States. Mid-America agreed to purchase the winter tires as a sign of goodwill in order to purchase summer tires at a later time. A letter of credit was established naming an agent of PTZ as beneficiary, with payment to be made only upon Mid-America authorizing the tires for shipment. Mid-America discovered the truth about the tires, did not authorize shipment, and sued to enjoin the issuer of the letter of credit from making payment on the basis of fraud. The trial court issued a permanent injunction. The appellate court reversed, holding that Article 5 of the Uniform Commercial Code (UCC) only allows enjoining payment under a letter of credit if the documents presented for payment are forged. Mid-America appealed to the Ohio Supreme Court, arguing that the UCC allowed an injunction for fraud in the underlying transaction.
Rule of Law
Holding and Reasoning (Resnick, J.)
What to do next…
Unlock this case brief with a free (no-commitment) trial membership of Quimbee.
You’ll be in good company: Quimbee is one of the most widely used and trusted sites for law students, serving more than 97,000 law students since 2011. Some law schools—such as Yale, Vanderbilt, Berkeley, and the University of Illinois—even subscribe directly to Quimbee for all their law students. Read our student testimonials.
Learn more about Quimbee’s unique (and proven) approach to achieving great grades at law school.
Quimbee is a company hell-bent on one thing: helping you get an “A” in every course you take in law school, so you can graduate at the top of your class and get a high-paying law job. We’re not just a study aid for law students; we’re the study aid for law students. Read more about Quimbee.
Here's why 175,000 law students have relied on our case briefs:
- Written by law professors and practitioners, not other law students. 14,000 briefs, keyed to 188 casebooks. Top-notch customer support.
- The right amount of information, includes the facts, issues, rule of law, holding and reasoning, and any concurrences and dissents.
- Access in your classes, works on your mobile and tablet. Massive library of related video lessons and high quality multiple-choice questions.
- Easy to use, uniform format for every case brief. Written in plain English, not in legalese. Our briefs summarize and simplify; they don’t just repeat the court’s language.