Business Law-National Drilling Company

National Drilling Company

Abstract

National Drilling Company ships its only pump to American Hydraulics Corporation, the manufacturer, for repair. National hires Overland Transport, Inc., to take the pump to American Hydraulics and to return it to National as soon as the repair is complete. National is forced to suspend operations without a pump, but Overland does not know this. National expects to be without the pump for five days and to lose profits of $5,000. When the pump is not returned by the end of the fifth day, National rents a pump at a cost of $100 per day. Overland delays five more days before returning the pump. National files a suit against Overland, asking for compensatory, consequential, and punitive damages. Will National recover?

National Drilling Company

National Drilling Company hires Overland Transport, Inc., to take the pump to American Hydraulics and to return it to National as soon as the repair is complete. Overland Transportation does not return the pump within five days. National Drilling Company had an expectation that the pump would be fixed within the five days. Overland does not know about this. The issue at hand here is that Overland did not know that National Drilling Company was expecting the pump to be fixed within a specified timeframe. It was never documented by contract, by either parties that the pump was mission essential and needed to be fixed within the five days. The Overland Organization had no indication that National Drilling Company had desired for the pump needing to be fixed within five days.

Under the "breach of contract" clause, (Hollowell, page198) I can conclude that Overland was not at fault during this case. I can assume the pump was fixed within the five day time period. The pump itself could have been fixed but awaiting quality control. There was absolutely nothing in the contract that states that the pump was time sensitive. Therefore, the National Drilling Company is...