Opinion ID: 1613032
Heading Depth: 1
Heading Rank: 3

Heading: Effect of ACT's Alleged Prior Breach

Text: Finally, Simcala argues that even if it was prohibited from reducing its requirements to 41% of its stated estimate, ACT is estopped to assert Simcala's breach because, Simcala argues, ACT breached the contract first when it lost its coal supplier in late August and was unable to deliver Simcala's shipment in early October. Thus, says Simcala, ACT's breach relieved Simcala of any further obligations under the contract and allowed it to suspend performance. We first note that the contract is silent concerning what suppliers ACT could use to meet Simcala's orders. ACT offered uncontradicted testimony that from mid-October through the end of the year, it would have been able to supply Simcala with coal had Simcala requested it. Section 7-2-610, also part of Alabama's version of the Uniform Commercial Code, states, in relevant part: When either party repudiates a contract with respect to a performance not yet due the loss of which will substantially impair the value of the contract to the other, the aggrieved party may ... suspend his own performance. (Emphasis added.) Thus, only anticipatory repudiations that substantially [impair] the value of the contract to the aggrieved party will give the aggrieved party the right to suspend its own performance. Official comment 2 to § 7-2-610; 2A Ronald A. Anderson, Anderson on the Uniform Commercial Code §§ 2-610:8 and 2-610:76; James J. White & Robert S. Summers, Uniform Commercial Code 173 (4th ed.1995). Whether a partial repudiation of a contract substantially impairs the value of the contract to the nonrepudiating party is a question of fact. Anderson on the UCC § 2-610:15. It is a well-established principle that [w]hen a trial court does not make specific findings of fact concerning a particular issue, an appellate court will assume that the trial court made those findings that would have been necessary to support its judgment, unless these findings would be clearly erroneous. Ex parte Byars, 794 So.2d 345, 349 (Ala.2001); Lemon v. Golf Terrace Owners Assoc., 611 So.2d 263, 265 (Ala.1992). In this case the trial court made no specific finding as to whether ACT's failure to deliver the 600 tons of coal in October substantially impaired the value of the requirements contract with Simcala, which contained an estimate of 17,500 tons. Simcala offered no evidence of any detriment it suffered as a result of ACT's failure to deliver the order. After reviewing the record, we conclude that ACT's failure to deliver the requested 600-ton shipment in October did not substantially impair the value of the contract, and a finding to that effect by the trial court would not have been clearly erroneous. That Simcala could not show a substantial impairment does not mean it was without legal recourse when it discovered that ACT's usual supplier for Black Creek coal had ceased operations and ACT failed to supply Simcala's October order. Section 7-2-609, Ala.Code 1975, states, in relevant part: (1) A contract for sale imposes an obligation on each party that the other's expectation of receiving due performance will not be impaired. When reasonable grounds for insecurity arise with respect to the performance of either party the other may in writing demand adequate assurance of due performance and until he receives such assurance may if commercially reasonable suspend any performance for which he has not already received the agreed return. (Emphasis added.) When Simcala learned that ACT had lost its supplier and was unable to deliver the October order, it could have made a written demand for adequate assurance of performance pursuant to § 7-2-609, Ala.Code 1975. Simcala made no such request. The uncontroverted evidence establishes ACT's ability to perform after its failure to deliver the 600 tons of coal ordered in October, perhaps explaining Simcala's failure to make such requests.