The Oral Flour Deal: Merchant Confirmations, a Unilateral Price Hike, and Cover

Yes.

Under UCC § 2-201(1), a sale of goods for $500 or more is unenforceable unless evidenced by a writing sufficient to indicate a contract and signed by the party charged - here, Roscoe. Roscoe signed nothing.

But § 2-201(2) supplies the answer: between merchants, a writing that is (i) sufficient against the sender and (ii) received by the recipient, who has reason to know its contents, satisfies the statute of frauds against the recipient unless written objection is given within 10 days of receipt.

Applying it:

• Merchants? Both parties deal in the goods of the kind; Roscoe buys flour in bulk for a commercial bakery - yes.
• Writing sufficient against Heartland? Signed by Heartland, states quantity (500 lbs) and price. Sufficient.
• Received with reason to know contents? Received January 8; it is an order confirmation plainly related to the January 5 call.
• Objection? The 10-day window ran to January 18. Roscoe never objected to the confirmation.

The contract is enforceable against Roscoe despite his silence. Note that the statute of frauds affects enforceability, not formation - the bargain was formed orally on January 5 under § 2-206/2-204.

$2.00 per pound.

• A modification under § 2-209 requires mutual assent (the agreement requirement of § 2-204 is not displaced). Heartland's February 1 email is a unilateral declaration, not an agreement. Roscoe rejected it the same day.
• Even if Roscoe had stayed silent, § 2-209(3) requires a modified contract that as modified falls within § 2-201 to satisfy the statute of frauds. At $2.40 the total would be $1,200 - squarely within § 2-201.
• The § 2-201(2) merchant-confirmation route would not work for the price increase either: a written modification sent by Heartland would bind Roscoe only if he failed to object in writing within 10 days. He objected immediately, which defeats both assent and the 10-day silence argument.
• Do not confuse the two documents: Roscoe's February 1 email objects to the price change. It is not an objection to the January 6 confirmation, and it is far too late to undo the window that closed January 18.

Result: $2.00/lb governs, and Roscoe's total obligation is $1,000.

Yes, the rejection was rightful, and Roscoe recovers $300 in cover damages, plus incidental damages less expenses saved.

Rejection. Under the perfect tender rule (§ 2-601), a buyer may reject goods that fail in any respect to conform to the contract. Pastry flour with ~20% lower protein is not bread flour. Roscoe also rejected seasonably, the same day of arrival, satisfying § 2-602(1).

No cure. § 2-508 allows cure only where the seller seasonably notifies and substitutes a conforming delivery within the contract time, or where the seller had reasonable grounds to believe the nonconforming tender would be acceptable. Delivery was due March 1; the goods arrived March 3, so the contract time had already run. The seller cannot cure by sending bread flour now.

Damages (§ 2-712). Cover damages = (cost of cover − contract price) + incidental/consequential − expenses saved:

• ($2.60 − $2.00) × 500 lbs = $300.
• Roscoe bought in good faith and without unreasonable delay (§ 2-712(1) and (2)), and the rising market cuts in his favor.
• Add any incidental costs (freight on the rejected shipment, storage). Consequential losses (e.g., lost bakery sales) require notice of breach under § 2-607(3) and proof of foreseeability (§ 2-715(2)).

Merchant duty on rejection. As a merchant, Roscoe must follow any reasonable instructions from Heartland about the rejected goods (§ 2-603) and hold them with reasonable care for a reasonable time (§ 2-602(2)(b)). The firm should send a written instruction-and-storage notice immediately so Heartland cannot later argue the flour was spoiled by Roscoe's handling.