Vanguard Energy Services, L.L.C. v. Shihadeh

82 N.E. 3d 1284 (2017)

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Vanguard Energy Services, L.L.C. v. Shihadeh

Illinois Appellate Court
82 N.E. 3d 1284 (2017)

Facts

Vanguard Energy Services, L.L.C. (Vanguard) (plaintiff) was a natural-gas supplier. Ibrahim Shihadeh, d/b/a Creative Designs Kitchen and Baths (Shihadeh) (defendant), was a businessperson. In February 2014, the parties entered into an oral agreement under which Shihadeh committed to buy 25 percent of his natural gas needs at a fixed price for the 2014-15 and 2015-16 winters. Vanguard sent an email to Shihadeh confirming the transaction, and Shihadeh did not protest it, but on February 2, 2015, Shihadeh sent a letter to Vanguard terminating Vanguard’s services effective April 30, 2015. Vanguard sued Shihadeh for breach of contract. Shihadeh moved to dismiss on the ground that the oral agreement was unenforceable under the statute of frauds. The trial court agreed and dismissed the suit. Vanguard appealed, arguing that the merchant exception in Uniform Commercial Code (UCC) § 2-201(2) and the specifically-manufactured-goods exception in UCC § 2-201(3) applied. Vanguard argued that Shihadeh was a merchant under UCC § 2-202(2) because as a person engaged in business, Shihadeh had the knowledge or skill to engage in business communications, and Vanguard further argued that the natural gas was specifically set aside for Shihadeh for a particular period and in a particular volume.

Rule of Law

Issue

Holding and Reasoning (Burke, J.)

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