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Everett Company chartered a ship for two years and agreed to make monthly payments of $25,000 to Michaels, the owner of the ship. Every month Everett wired a telex message to his bank to transfer the monthly payment to Michaels.
One month, the bank failed to act on Everett's instruction and did not transfer payment. Under the charter contract, Michaels could cancel the contract if Everett failed to make a monthly payment. Michaels canceled the contract. As a result, Everett lost profits of about $2 million because it was unable to charter another ship. Everett sued the bank and the evidence proved that the bank was negligent in failing to make the payment as instructed by Everett.
Who wins? Why? Was there consideration for the bank's promise to make the monthly payments? Where were the offer and the acceptance?
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