ROTH STEEL PRODUCTS V. SHARON STEEL CORP.
705 F.2d 134 (6th Cir. 1983)
NATURE OF THE CASE: This was an appeal from a damages award due to a breach of contract. Sharon (D) appealed and Roth (P) cross appealed from a judgment in a diversity action concerning an alleged breach of an oral contract, modification of contract, and adequate notice of breach of contract.
FACTS: Sharon Steel Corp. (D), made a below published prices contract with Roth Steel (P) for P to buy 200 tons of steel per month for $148 per ton for pickled and $140 per ton for rolled black for the entire year. Within six months the supply of steel fell and prices began to rise substantially, D told P that it would no longer sell steel at below published prices. P agreed with the new terms for the last six months of the contract because P had no second source of supply. D's shipments in the last six months were often late and P was forced to pay even higher prices. D attributed the additional problems to material shortages and regulatory problems. P learned that the delivery problems were due to D's practice of selling steel to its subsidiary at premium prices. P sued for breach. The trial court found that D's modification was not done in good faith. P was awarded damages; the difference between the new contract price and the original contract price. D appealed and P cross appealed the denial or prejudgment interest.
ISSUE:
RULE OF LAW:
HOLDING AND
DECISION:
LEGAL ANALYSIS:
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