Hasbro used to manufacture a toy called “Wonder World Aquarium”. The toy included a powder that,...

Question

Hasbro used to manufacture a toy called “Wonder World Aquarium”. The toy included a powder that, when mixed with water, formed a gel that filled a plastic aquarium. Children could then place plastic fish in the aquarium and create underwater scenes. Cloud Corporation supplied the powder to Hasbro. The toy sold poorly, and Hasbro’s need for the powder diminished,

The two companies discussed changing the powder’s formula. Cloud believed the conversation amounted to an indication that Hasbro would continue to buy powder, so it produced large quantities. Although it did not receive an order from Hasbro, Cloud sent an order acknowledgement for 9.5 million packets to Hasbro. Hasbro made no objection to it.

Did the order acknowledgement create an enforceable agreement? What specific facts determine your answer?

Robert · Accepted Answer

Hasbro V. Cloud 
 
Answer: 
As per the provisions of contract law, the order acknowledgement when countersigned by the 
buyer becomes a typical sales contract. In the Hasbro and cloud case, Cloud Corporation sent 
an order acknowledgement to Hasbro without receiving an order from them.

Hasbro used to manufacture a toy called “Wonder World Aquarium”. The toy included a powder that, when mixed with water, formed a gel that filled a plastic aquarium. Children could then place plastic...

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