Can I be held to a contract to deliver my farm product when the processor is paying below the cost of my operation?

UPDATED: Sep 30, 2022

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Can I be held to a contract to deliver my farm product when the processor is paying below the cost of my operation?

I am a cranberry grower. I sell my cranberries to a handler locally who then uses them mostly for their own product and also sells them to their customers. This handler makes everyone sign a 3 year evergreen contract that states if i want out i have to give them a letter of notice this year and still deliver to them for the next 3 years before I am free. This handler is dropping

the price they pay to us because they can get away with it since we are locked in. They forcasted one price that I banked on this year but, now they are cutting that price drastically. Can someone hold me to a contract when they are paying below my breakeven for the last 4 years, especially when there are others out there that are paying better.

Asked on July 27, 2016 under Business Law, Wisconsin


SJZ, Member, New York Bar / FreeAdvice Contributing Attorney

Answered 6 years ago | Contributor

The enforceability of a contract is not affected by whether the contract is good or bad (even disasterous) for you, and you can be held to contracts below your breakeven, on which you lose money. The economic conditions or your finances are irrelevant here. You can only escape the contract if the other party breaches or violates it in some material, or important way (that material breach will then let you treat the contrat as terminated) or if there is some clause or provision in the contract itself that lets you get out of it, and you fully comply with all that provision's requirements.

IMPORTANT NOTICE: The Answer(s) provided above are for general information only. The attorney providing the answer was not serving as the attorney for the person submitting the question or in any attorney-client relationship with such person. Laws may vary from state to state, and sometimes change. Tiny variations in the facts, or a fact not set forth in a question, often can change a legal outcome or an attorney's conclusion. Although has verified the attorney was admitted to practice law in at least one jurisdiction, he or she may not be authorized to practice law in the jurisdiction referred to in the question, nor is he or she necessarily experienced in the area of the law involved. Unlike the information in the Answer(s) above, upon which you should NOT rely, for personal advice you can rely upon we suggest you retain an attorney to represent you.

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