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This case looks at what happens when a party meets an additional demand of some contract term for a period of years then seeks to strictly enforce the term. Cases of Interest
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Mulberry-Fairplains Water Assn. v. Town of North Wilkesboro

Case Brief 3

Case Name: Mulberry-Fairplains? Water Assn. v. Town of North Wilkesboro

Case Cite: 412 S.E.2d 910 (N.C. App. 1992).

Facts: A non-profit corporation supplied water for a town in North Carolina. The corporation continually purchased its water from an Association for many years pursuant to a written water contract. The contract contained a clause that specified the maximum quantity amount of water that would be supplied to the corporation from the Association and the price that would be charged for the water. However, many individual and commercial customers were added to the corporation's service area over the years which called for water in excess of the maximum contract amount. The Association complied with the corporation's need for more water in excess of the contract maximum and still charged the same contract price for all the excess water. This went on between the parties for fifteen years before there was a dispute.

Procedure: The water association sought review of an order of the Wilkes County Superior Court in North Carolina that granted the city's motion for partial summary judgment in its action asserting that a contract with the water supplier was not binding on the city.

Holding: The court affirmed the order of the trial court that granted the city's motion for partial summary judgment in the water association's action asserting that a contract with the city was not binding. The association was performing a proprietary function when it entered into a contract with the city and agreed to a price provision therein.

Reasoning: The court declared that it would not be equitable to allow the Association to now deny that modifications took place in order to enforce the contract maximum because the course of performance between the parties over the last fifteen years altered the contract. The court required the Association to supply the excess water at the normal contract price until a new maximum amount could be agreed to at the expiration of the current contract.

Future Importance: A party cannot lead another party to believe over time that a certain course of conduct is acceptable and then later seek action against that party.

Critical Analysis: There was no discussion or agreement to modify the contract terms. The corporation simply needed more water and the Association provided them with water in excess of the contract maximum without question. Therefore, this case provides that a course of dealing between the parties can start in accordance with the written contract, but eventually develop into an additional requirement due to the parties' continued course of dealing over time.

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