Introduction
Fair play in business practices is essential to the maintenance of a self-sustainable corporate environment. Precisely, all the parties involved in any business activity need to embrace ethical principles while following the legal provisions in any commercial venture. With this in mind, it is worth acknowledging the fact that Kallestad breached the fundamental provisions of an implied warranty by selling substandard products to Peter and Tanya Rothing. According to Murthy and Blischke (2006), an implied warranty is a contract arising from the operation of the law guaranteeing that the goods to be sold are merchantable and are appropriate for the purpose for which they are being sold. In this case, the Rothing stable farm had casualties after the horses consumed the hay bought from Kallestad. As a merchant, the law compels Kallestad to sell products that reasonably conform to the consumer’s expectations. As such, the nature of the hay sold to the Rothing stable farm violates the warranty of merchantability captured in the common laws of the jurisdiction. This paper evaluates Rothing v. Kallestad case and provides a rationale for the best alternatives to avoid the case problems. This assessment is resourceful to the plaintiff, Rothing, as it outlines the problems faced by the party and appropriate discretions to solve the issue at hand.
The primary reason for the emergence of this disagreement is the violation of the implied warranty. Specifically, Rothing assumed that Kallestad was aware of the warranty of merchantability and the ethical implications that would arise through the breach of this term. According to the Journal of Insurance and Indemnity Law, failing to meet the provision of an implied warranty is a foul play in the corporate practice (Johnson, 2015). In this case, Kallestad violated the warranty of merchantability by selling hay that was unsuitable for consumption. Additionally, the casualties experienced by the plaintiff augmented the nature of the disagreement due to the financial losses encountered in the process. On the other hand, Kallestad did not acknowledge his fault in the issue by admitting his violation of the implied warranty. Instead, he played a defensive role by claiming that the cause of the horse death, botulism, was unforeseeable. As a result, this problem had to be forwarded to the court as no party was willing to let go of the issue in a more appropriate way. This situation is largely accredited to the fact that both sides needed the court ruling to favor their endeavors so that they could enhance their business stability and overall reputation.
The Diamond R Stables should have evaluated the quality of the product to be sold before making the purchase. According to Johnson (2015), due diligence involves the steps taken by an individual to ensure a product satisfies the legal requirements when buying or selling something. In this case, taking this alternative would have made the outcome of the transaction lesser disheartening. For starters, successful identification of the defect leading to botulism would have been identified promptly thereby securing the lives of the client’s horses. Additionally, this approach is cost effective as it would have prevented the Rothing firm from making financial losses through the death of some horses. Finally, this approach would enhance the level of accountability of the Kallestad Company. However, it is worth noting that this approach would prove to be lesser influential in some aspects. Since the hay defect matured after a period, about a week, determining the existence of the problem during the initial diagnostic is bound to yield uncomprehensive results. Therefore, preventing the cause of death is unassured through this approach. Additionally, the already established credibility of the Kallestad farm, it has been in operation for more than twenty years, would influence the buyers perspective about the quality of the products. Since the company has a good reputation, the attention to detail employed by the quality assessment team is bound to be mediocre.
Specification of the contract terms
Rothing should have specified his purchase terms prior to the transaction and made the terms of warranty distinct. Through this alternative, settling the dispute would have been lesser challenging for both parties in a similar event. For starters, Rothing would have accepted to make the purchase under specific terms that are acknowledged by the Kallestad farm. As such, the merchantability term of the provisions of an implied warranty would have captured the development of medical complications arising from the consumption of the hay. This approach would have saved both parties a considerable amount of time that would otherwise have been spent in a courthouse. Additionally, the reputation of the Kallestad farm would not be compromised if the outcome of the transaction was captured in the initial contract terms. Through the issuance of a disclaimer, Kallestad would have been more aware of the issues he would be held accountable for in the end. The Journal of Insurance and Indemnity Law reports that outlining contract terms before engaging in a corporate venture augment the possibilities of having a productive business deal. In this case, the financial implications for both parties would be lesser disheartening. However, this alternative does not offer an all-round solution to the current state of affairs since capturing the botulin disease in the contract terms is somewhat impossible due to the wide array of possible problems.
Out of court settlement
Rothing and Kallestad should have opted for an out of court type of settlement. Through this alternative, the outcome of the discussion would be based on the satisfaction of both parties. According to Murthy and Blischke (2006), utilizing a settlement approach in a business scenario is a time effective alternative that provides an important solution to all the parties involved. Since both sides, plaintiff and defendant, are in a dilemma about the outcome of the court proceedings, it would have been better if they took this approach as opposed to a court hearing. Through this method, Rothing will get compensation for the casualties he suffered through the hay consumption. Additionally, the Kallestad hay farm will retain its twenty-year reputation for offering quality services to the clients. This situation is largely accredited to the fact that the organization will enhance its reputation through the creation of an accountable perspective to the clients. Finally, lesser time would be spent in handling the issue as opposed to the court proceedings that can take months before the courthouse arrives at a decision. Aside from the fact that this approach is influential to the betterment of both organizations, it is worth mentioning that it does not provide a universal solution to the problem, and it is expensive. By forcing the defendant to face the compensation charges, the approach is denying the hay firm its right to a fair trial. Moreover, there is no assurance of both parties agreeing to the terms of the settlement.
Health assessment on the animals
Rothing should have conducted a health assessment of the condition of the animals before administering the hay purchased from Kallestad. According to Johnson (2015), animals have resistant genetic properties that enhance immunity against a particular type of illness. In this case, nineteen of the animals in the plaintiff’s farm lacked proper immunity against this toxin. Conducting a medical assessment before the issuance of the hay would have minimized the chances of having these casualties by creating a framework to take appropriate actions. Additionally, this alternative would have eliminated the dispute that would arise between the two parties as the responsibility would be shifted to the stable firm and not the merchant. Therefore, the negative outcome of the current problem would be prevented. However, this approach is not very influential since it inappropriately disregards the failures of the merchant. Since the implied warranty compels a trader to sell goods fit for consumption, forcing Rothing to take responsibility is a misguided approach. Additionally, conducting an initial assessment to enhance the immunity of the animals is a costly practice that could be avoided if the merchant delivered a quality product in the first place. As such, this alternative falls short in these aspects.
Conclusion
In conclusion, corporate organizations ought to embrace ethical practices in the professional context. Similarly, Kallestad should have evaluated the quality of the products they sold to the stable firm before completing the transaction. Additionally, a due diligence evaluation should have been done by both parties to eliminate the possibilities of foul play in the sale. As such, Kallestad violated the implied warranty of merchantability by not providing suitable goods for consumption to the buyer. Through the utilization of the alternatives presented above, the situation would have been lesser detrimental. Therefore, corporate establishments should consider these options before making a purchase.
References
Johnson, J. A. (2015). Implied Warranty of Plans and Specifications. Journal of Insurance and Indemnity Law, 8(1), 8-9.
Murthy, D. N., & Blischke, W. R. (2006). Warranty management and product manufacture. New York: Springer.
