## Facts

- A grain dealer (buyer) and a farm seller entered a forward contract (Jan. 17, 1973) for 10,000,000 pounds of No. 2 yellow grain sorghum at $2.70 per cwt, to be shipped in October and November 1973, FOB rail cars in West Texas.
- The seller began shipments in October 1973 but, by November 30, delivered only 2,023,480 pounds due to a rail-car shortage.
- After the delivery window closed, the buyer encouraged continued deliveries and assisted logistics, including hauling multiple truckloads in early December to a railhead and storage facility.
- Grain prices rose substantially after the contract was made and during the period of nondelivery.
- In December 1973, the buyer sued for breach for failure to deliver the contract quantity; the seller later sent a December 10 letter treated by the court as a repudiation.
- After the repudiation, the buyer refused to honor the seller’s drafts for late-delivered grain; the seller counterclaimed for payment for grain delivered.
- The buyer, as a merchant dealer, commingled grain from multiple sources and did not segregate grain by supplier.

## Issues

1. Whether the buyer waived the seller’s late and incomplete performance by accepting and assisting with late deliveries after the contract delivery period.
2. Whether a buyer must prove “cover” under UCC § 2.712, or may instead recover market-minus-contract damages under UCC § 2.713 for nondelivery.
3. Whether evidence of market price at the time of breach is sufficient to support § 2.713 damages without proof of specific replacement purchases.
4. Whether alleged charge errors and the seller’s claim for attorney’s fees on its counterclaim required reversal.

## Decision

- The appellate court affirmed a judgment for the buyer with a net recovery of $69,886.12 on the first contract (after offsets/credits on the seller’s counterclaim).
- The buyer’s acceptance of some late performance and cooperation in transportation did not constitute waiver as a matter of law.
- After the seller’s repudiation, the buyer was entitled to suspend its performance, including refusal to honor drafts, under UCC § 2.610.
- The buyer could recover damages under UCC § 2.713 based on market price at the time of breach, and was not limited to § 2.712 cover damages.
- The evidence of market price supported the jury’s damages finding; proof of particular cover transactions and their costs was not required.
- The court found no reversible error in the jury submissions and rejected the seller’s request for attorney’s fees on its counterclaim.

## Legal Principles

- Under UCC Article 2, cover under § 2.712 is an available remedy but not an exclusive or mandatory measure of damages for a buyer claiming nondelivery.
- A buyer may recover under § 2.713 the difference between market price at the time of breach and the contract price, based on competent market-price proof.
- A dealer-buyer that commingles fungible goods need not trace or itemize specific replacement purchases to recover § 2.713 market damages.
- Continued dealings after a missed delivery deadline do not automatically waive breach; waiver generally requires clearer proof than acceptance of partial or late performance.
- Upon anticipatory repudiation, the aggrieved party may suspend performance under UCC § 2.610.

## Conclusion

The court held that the seller’s failure to deliver the contract quantity permitted the buyer to recover market-minus-contract damages under UCC § 2.713 without proving specific cover purchases, and that the buyer’s acceptance of late deliveries and post-deadline cooperation did not waive breach, particularly after the seller’s repudiation triggered the buyer’s right to suspend performance.


Jon-T Farms, Inc. v. Goodpasture, Inc., 554 S.W.2d 743 (Tex. Civ. App.—Amarillo 1977)