KLE Society’s Law College, Bengaluru

Moot Problem for CC-IV

Harvey Leathers Co. v. Rai Shoes Pvt. Ltd.

1. Vikrant Rai is the owner of Rai Shoes Pvt. Ltd (RSPL), an extremely reputed, experienced and
influential shoe manufacturing company. It has its office in Pune, Maharashtra. Harvey Leathers Co
(HLC), is a leather supplier, trying to develop its business in the State. They provide good quality
leather, suitable for shoe manufacturing, with monthly production limit of 23000 metres.

2. After hearing of HLC’s business, RSPL initiated communication through a letter dated 19th
August 2014, with the following text- “Can you produce 40000 metres of leather at the end of every
two months for RSPL? First delivery to be in the month of Oct 2014.”

3. HLC replied in the affirmative, and stated the price of the raw leather for the first delivery as
Rs. 400 per metre i.e. the market price, via its letter dated 20th August 2014. RSPL accepted HLC’s
terms by its letter dated 21st August 2014, which included the following text-“We accept all the
terms and conditions mentioned in your letter. We humbly request you to consider including an
escalation clause in the agreement, so that the prices can be adjusted in case of change in the
market price of shoes. Kindly deliver on time; leather shall be required in October.”

4. While RSPL was awaiting delivery from HLC, Mr. Rai received information that HLC is about to
enter a heavy contract for raw leather delivery of 18000 metres per month with another company.
Apprehending that HLC may breach their contract, on 2nd Sep.2014, Vikrant Rai called the owner
of HLC, Mr. Yash, in a fit of rage, demanding that he deliver the goods by October, otherwise HLC
would be left with almost no contracts in future. Mr. Yash began, “I have never-” but by that time
Mr. Rai had hung up. After two months, in October, the delivery was made and money was paid as
per the contract.

5. On 1st November, 2014, RSPL requested HLC to revise the cost per metre to Rs. 300, since the
market price of leather shoes had gone down proportionately. HLC replied stating that- “We are
aware of the fact that the market prices of the shoes have gone down. We will revert positively to
you within a few days.” There was no reply from HLC in next one month regarding the same, and
after the passage of time, RSPL reduced the cost price to Rs. 300/metre and refused to pay more
than that for second delivery in the month of December 2014.
 KLE Society’s Law College, Bengaluru
Moot Problem for CC-IV

6. HLC asked the RSPL to pay the original contracted price so that HLC can deliver the goods.
When RSPL denied paying more than Rs.300 per metre, HLC stopped the delivery and moved the
Hon’ble Court by filing a suit against RSPL, alleging that RSPL has coerced HLC to enter into a
contract, and later had unilaterally materially altered the contract. RSPL has refuted all allegations,
and has asked for the goods to be delivered. The suit has been fixed for final hearing.