Question from the second Bernstein case: What exactly does it mean that "this order is given and accepted subject to a limit of credit and determination at any time by us?"

Emel

-- Anonymous, September 27, 1998

Answers

I took it to mean that the plaintiff reserved the right to "terminate" its end of the bargain. At least that's what I wanted it to read. In Black's determination is defined as "2. the ending or expiration of an estate or interest in property or of a right, power or authority..." Does this make sense?

-- Anonymous, September 27, 1998

Here's what I think: The plantiffs argue that it means "determination of limit of credit", and therefore they cannot break the contract unless the credit is found wanting., i.e. this is not an open-ended, arbitrary way to refuse to fulfill an order. The defendant argues that the two terms, "limit of credit" and "determination", are independant, meaning the order would not be delivered if either (1) credit was lacking or (2) they "determine" they don't want to fulfill the order. The court's "fair construction" says: "determination" applies to "order" as well "limit of credit", and thus the defendant's argument is correct.

-- Anonymous, September 27, 1998