Contracts: Remedies: In Rem: Adequate Assurances (A2)

    • Adequate Assurance (Article 2) – Right to request assurance. A party with reasonable grounds for insecurity (nervousness) may request in writing adequate assurance from the other party.
      • If the other party does not provide adequate assurance, this can be treated as an anticipatory repudiation of the contract. However, an anticipatory repudiation can be retracted to the extent the other party had not relied on it.
      • S contracts to sell B goods on credit. Later, S learns that B is missing payments to other suppliers. Can S demand that B pay cash? No. A party cannot use this provision to re-write the contract, or to demand a particular kind of assurance—all that S is entitled to here is adequate assuranace.