please write an essay on the question. No book needed National Drilling Company
ID: 362351 • Letter: P
Question
please write an essay on the question. No book needed
National Drilling Company ships its only pump to American Hydraulics Corporation, the manufacturer, for repair. National hires Overland Transport, Inc., to take the pump to American Hydraulics and to return it to National as soon as the repair is complete. National is forced to suspend operations without a pump, but Overland does not know this. National expects to be without the pump for five days and to lose profits of $5,000. When the pump is not returned by the end of the fifth day, National rents a pump at a cost of $100 per day. Overland delays five more days before returning the pump. National files a suit against Overland, asking for compensatory, consequential, and punitive damages. Will National recover? Would additional damages be recoverable if American Hydraulics knew that failure to return the pump when promised would cause National to shut down ? Explain 2.Explanation / Answer
This is a tripartite case involving National Drilling Company, Overland Transport & American Hydraulics Corporation.
The first and foremost proof of service should be the contract document and terms of service agreed between the two parties – National & Overland.
If the service agreement clearly specifies an expected service level (such as total turnaround time) and the penalties thereafter, then National has a chance to recover the expenses it has incurred on renting the pump and for the delays breaching the service level agreement.
Keeping this in context, National can recover if the contract agreement supports such an arrangement between the two parties.
Again the repair service agreement between National Drilling Company & American Hydraulics Corporation will decide the legal course of action. If the American Hydraulics is bound by the contract to repair within a time limit and report it to the National to ship it back, it is bound by the contractual agreements and payable to National for the damages and rent expenses incurred. However, just knowing a situation without having any legal framework around the services would not help National to recover its charges and damages from the respective companies.
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