Kunian v. Development Corp. of America
Supreme Court of Connecticut
334 A.2d 427 (1973)
A. Merowitz and Company, Inc. (plaintiff) agreed to deliver materials to Development Corporation of America (DCA) (defendant) in installments under a purchase order with fixed payment deadlines and a 2 percent prompt-payment discount. DCA repeatedly failed to pay for deliveries despite promises to do so, and when Merowitz demanded DCA place funds in escrow before further deliveries, DCA refused. Merowitz sued for breach seeking payment for past installments, then filed for bankruptcy, with trustee Stephen Kunian (plaintiff) substituted in. The trial court found DCA had breached and ruled for Kunian; DCA appealed, arguing the payment deadlines only affected the discount, that Merowitz reinstated the whole contract by suing only for past installments, and that Merowitz then separately breached by failing to continue deliveries.
Whether a party may suspend its performance until it receives adequate assurance of the other party's performance, if there are reasonable grounds for insecurity about the other party's performance.