# Step-by-Step Solution ## Given Facts - **Regular coal shipments** from Brogden to Metro. - **Negotiations** for a formal contract occurred on **May 23**. - **Implied contract** principles apply (based on _Brogden v Metro Railway_). ### Shipment Timeline | Date | Tons shipped | Metro's action | |------------|---------------|-----------------| | April 2 | 65,000 | Received | | May 2 | 85,000 | Received | | May 22 | 65,000 | Received | | June 2 | 45,000 | Rejected | | July 2 | 40,000 | Received | | August 2 | 125,000 | Received | | August 29 | 85,000 | Received | --- ## [1] Date of Implied Contract **Implied contracts** arise by conduct, not formal agreement. In _Brogden v Metro Railway_, a contract was implied when both parties acted as if a contract existed (e.g., performance/delivery/acceptance). - The **first three shipments (April 2, May 2, May 22)** were all delivered and accepted **before May 23**, the date of negotiation. - The **first post-negotiation conduct** is the **June 2 shipment**, but this was **rejected** by Metro. - **July 2**: Next shipment, and Metro **received** it. **Key Principle:** The implied contract is generally recognized at the point the parties' conduct shows mutual acceptance of obligations (i.e., delivery and acceptance of goods). **Final Answer:** > **July 2, 20XX** --- ## [2] Aggregate Tons - Metro's Contractual Liability **Metro's liability**: total tons delivered by Brogden **and accepted** by Metro under the implied contract. **Shipments received after implied contract came into force (from July 2 onward):** - July 2: 40,000 - August 2: 125,000 - August 29: 85,000 **Sum:** \( 40,000 + 125,000 + 85,000 = 250,000 \) tons **Final Answer:** > **250,000** --- ## [3] Effect of June 2 Rejection on Liability **June 2:** Brogden shipped, Metro rejected. **Implied contract theory:** No contract is formed until both parties act in accordance with the contract terms (performance and acceptance). The rejection on June 2 indicates **no acceptance**; therefore, Metro is **not liable** for this shipment. **One-Sentence Explanation:** > The June 2 rejection shows Metro did not accept the shipment, so no implied contract arose at that time and Metro incurred no liability for those 45,000 tons. --- ## [4a] Theory of Cause of Action (Contracts) Common theory for contract-like recovery without an express contract: - **Quantum meruit** (reasonable value of services/goods rendered when no contract exists) - **Implied contract** - **Unjust enrichment** **Max three words:** > Quantum meruit --- ## [4b] Basis of Recovery Typical basis under quantum meruit: - **Reasonable value** (of goods/services) **Max three words:** > Reasonable value --- ## [5] Damages Payable **Instruction:** Use data from [B3] (not provided here, but the pattern is to multiply the tons by the reasonable value per ton). Assume [B3] states: - Reasonable value per ton = $10 (for example) **Total tons (from [2]):** 250,000 **Damages = 250,000 × $10 = $2,500,000** > **2,500,000** (if the per ton value is $10; replace with correct value from [B3] if otherwise) --- # Summary Table | Question | Final Answer | |---------------------|------------------------------------| | [1] Date | July 2, 20XX | | [2] Tons | 250,000 | | [3] June 2 effect | No liability; no contract formed | | [4a] Theory | Quantum meruit | | [4b] Basis | Reasonable value | | [5] Damages | 2,500,000 (if $10/ton) | --- **Note:** - Replace the year "20XX" with the relevant year if provided. - For [5], use the actual value per ton from [B3] if available.