Thought of an example. Where I work we contract for grain. The contracts say that a supplier must deliver a certain minimums and maximums each month at the contracted price. If they go over they get the day's spot price.
However their grain can be rejected if the quality is too poor or else they can be penalized for things like damage, disease, toxins, or too much moisture. In some contracts, the supplier actually has to pay our company the value of any grain short of their contracted amount.
When contracts are written, both sides have obligated "deliverables".
However their grain can be rejected if the quality is too poor or else they can be penalized for things like damage, disease, toxins, or too much moisture. In some contracts, the supplier actually has to pay our company the value of any grain short of their contracted amount.
When contracts are written, both sides have obligated "deliverables".