Oloffson v. Coomer

Richard Oloffson (plaintiff) was a grain dealer who was in the business of merchandising grain. Oloffson was thus considered a “merchant” under Uniform Commercial Code (UCC) § 2-104. Clarence Coomer (defendant) was a farmer who supplied corn for Oloffson’s business. Coomer was not a merchant under the UCC. On April 16, 1970, Coomer agreed to sell Oloffson 40,000 bushels of corn for approximately $1.12 per bushel, to be delivered in two installments of 20,000 bushels each in October and December of 1970. On June 3, 1970, Coomer informed Oloffson that he would not be planting corn because the season had been too rainy. Coomer told Oloffson that Oloffson should arrange to obtain corn elsewhere if Oloffson had promised to deliver corn to a third party. On this date, the price of corn for future delivery had risen to $1.16 per bushel. In September of 1970, Oloffson asked Coomer again about delivering corn, and Coomer repeated that he would not be able to deliver. Oloffson continued to ask Coomer to perform, but the scheduled delivery dates passed with no delivery of corn. Oloffson subsequently covered his own obligations to a third-party vendee by purchasing 20,000 bushels of corn at $1.35 per bushel and 20,000 bushels at $1.49 per bushel. Oloffson brought suit to recover damages from Coomer. Oloffson said that he followed a usage of trade that allowed customers to cancel their contracts for future deliveries if the customer told Oloffson that they wanted to cancel and paid Oloffson the difference between the contract price and the market price on the day of cancellation. However, Coomer was unaware of this usage of trade, and Oloffson did not tell Coomer about it. The trial court awarded Oloffson $1,500, which was the difference between the contract price and the price of corn on June 3, 1970, when Coomer first told Oloffson he would not deliver. The trial court also found that Oloffson had not acted in good faith with respect to his failure to disclose to Coomer how to cancel the contract. Oloffson appealed to the Illinois Appellate Court, arguing that the proper measure of damages was the difference between the contract price and the market prices on the October and December dates when the corn should have been delivered pursuant to the parties' contract.