Legal Question in Business Law in California

Breaking terms of a verbal and written agreement?

I own a doll company and factory. I have a client that asked us to do a line of doll clothing for her. I agreed and told her that I would supply her with samples to get sales from, but that she had to buy her own fabric, and pay for shipping to and from my factory in the orient. She agreed to this. We sent her the samples that she requested and she took orders from them. When she put up the collectoin, I noticed that her prices were low and I asked her if she realized that she had to pay her shipping costs, which can be high especially coming from the orient. She got very angry and said that I had never mentioned the shipping costs. Which I clearly did, in writing and by phone. So now she is canceling all her sales, and returning the money to her customers and refusing to pay me, and keeping my samples. Can I sue her or get my samples back or since her material's at my factory. Can I just produce the line and sell it to make up for the money she screwed me out of?


Asked on 7/29/08, 12:52 am

3 Answers from Attorneys
Michael Stone Law Offices of Michael B. Stone Toll Free 1-855-USE-MIKE

Re: Breaking terms of a verbal and written agreement?

Depends on the contractual terms and other factors. Why don't you have a lawyer doing your contracts?

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Answered on 7/29/08, 1:22 am
Bryan Whipple Bryan R. R. Whipple, Attorney at Law

Re: Breaking terms of a verbal and written agreement?

These questions are all commonplace and ordinary issues covered by the Uniform Commercial Code and to some extent classic law of contracts. The outcome is likely to be in you favor in a lawsuit or arbitration, but some fact questions remain such as whether the "mention" of shipping costs, or FOB point, even though "clear," is part of the contract or not.

For example, Commercial Code sectio 2308 says:

"Unless otherwise agreed:

(a) The place for delivery of goods is the seller's place of business or if he has none his residence; but

(b) In a contract for sale of identified goods which to the knowledge of the parties at the time of contracting are in some other place, that place is the place for their delivery; ......."

Other sections of the Code provide that the buyer is responsible for the movement and safety of the goods beyond the point of delivery, including freight and insurance, unless the terms specify otherwise, such as FOB, FAS, CIF, etc., each of which as its own special meaning.

Sounds like you have a strong case, but I cannot say so with absolute certainty without reviewing all the evidence, including all written exchanges and what you say you told the buyer orally, and when.

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Answered on 7/29/08, 1:29 am
Terry A. Nelson Nelson & Lawless

Re: Breaking terms of a verbal and written agreement?

You're not going to get actual 'legal advice' here in answer to specific questions; legal advice can be given only to clients in an attorney/client relationship. You're asking for free advice on which to base serious business decisions that could get you sued. To get an answer you can rely on, consult with counsel and discuss all the facts and documents on point. The answers will be based upon what your contracts and documents actually say, not what you think they say. Feel free to contact me if serious about doing this right.

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Answered on 7/29/08, 12:55 pm


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