Business Law II Discussion Questions
Gerwin's daughter Mary was seeking a position as an associate attorney with Baker, Charles & Dixon, a large metropolitan law firm. The firm, after several meetings with Mary over a two-month period, made Mary an offer of employment on January 15. Mary accepted the offer that day and immediately left for Cape Cod to celebrate without telling Gerwin or anyone else about her new job.On January 17, two days after Mary had accepted the offer, Gerwin sent Baker, Charles & Dixon a letter in which she offered to give Baker all of her legal business (approximately $40,000 per year) if the law firm would hire Mary. The law firm accepted.After Gerwin learned that Mary already had been hired by Baker, Charles & Dixon, Gerwin refused to transfer her business to the law firm. The law firm has brought suit against Gerwin on the grounds that a valid contract exists between them. How will the case be decided?
For it to be a contract both parties have to have consideration to form a contract, and consideration is invalid if the consideration was already a previous contract. Mary already had a contract with them, so it would be unfair for Gerwin to bargain her firm to entice them to hire her when obviously they did it anyway. It is a good protection law.
Newlog, which had developed a new process for making artificial logs, entered into an oral contract with Specialty Manufacturing. The contract provided that Specialty would manufacture a special part that Newlog needed to make its artificial log machinery. The contract provided that Specialty would make the part to Newlog's specifications. Newlog orally agreed to pay $5,000 for the part. Specialty made the part to Newlog's specifications, but Newlog refused to pay, claiming that the oral contract was unenforceable because of the statute of frauds. Is Newlog correct?
If the case were not specialty, Newlog would not have been forced to pay since the oral agreement amount was over $500 and not put into a written agreement. Section 22-2a states that Statue of Frauds is "Whenever the sales price of goods is $500 or more, the sales contract must be evidenced by a record to be enforceable." However in this case, the Statue of Frauds cannot be used as a defense because this sale of good were specialty and specifically made for their company; thus, the manuafacter could not turn around and resell the product because it is specific to a company and not a general product for everyone. Therefore Newlog would be required to pay the $5,000 they orally agreed to because specialty manufactured goods do not require a written contract to protect the manufacture from situations like this. As long as Specialty Manufacturing had begun producing the product, which they had, Statue of Frauds does not apply despite the agreement being over $500. In section 22-2d, it states a few exceptions to the Statue of Frauds. One of them being specialty manufactured goods, which I already discussed, and the other is receipt and acceptance. It does not specifically state wether Newlog received and accepted the product, but if they had this is another proof of evidence that Specialty Manufacturing could use to hold them liable for the $5,000... "An oral sales contract may be enforced if it can be shown that the goods were delivered by the seller and were both received and accepted by the buyer even if the amount involved is over $500 and there is no record. The receipt and acceptance of the goods by the buyer makes the contract enforceable despite the statute of frauds issue." (22-2d).
Read "Ethics and the Law" from the chapter on Legality and Public Policy, then watch the attached video regarding Baby M. Should a surrogacy contract be valid or void? What types of behavior would be encouraged if the contract were declared valid? Is it ethical to "rent a womb"? Is it ethical to sell a child? Is it against public policy to allow it to continue? Discuss thoroughly. Initial post should be approximately 100 words. Responses should be at least 30 words per response.
If the topic is regarding Baby M. then I believe the contract should be valid. This is only due to the fact that she was totally aware of the terms of the surrogacy before she gave birth to the baby and saw her. The contract she signed said that should would surrender the baby after birth and not fight for her. It is a touchy subject because in this case the surrogate was carrying a child that was created using her own eggs, it was not an egg created by the receiving parents and placed into her. This makes this case different from cases with the surrogate not having any biological connection with the fetus. In baby M.'s case, the surrogate did have some mental attachments that caused her distress when giving up the baby, this would go against public policy because in section 15-2a It states "Contracts that may be unenforceable as contrary to public policy frequently relate to the protection of the public welfare, health, or safety; to the protection of the person; and to the protection of recognized social institutions." Thus, meaning that the distress is caused her would be against public policy. However, she did sign the contract knowing all of the terms and willingly participated, but the public policy factor could be argued to make it void. If this contract were to be declared valid, I believe that the surrogate would have to give up all right to the child because she signed the contract. On the other hand, it would set a precedent for future cases so the courts would need to carefully make a ruling.
Sam Student had borrowed $1,000 from his cousin. Sam and the cousin became involved in a heated disagreement when the cousin began to press Sam for repayment of the loan. Finally, Sam wrote a check for $190 to the cousin and conspicuously wrote on the check in big letters that it was full and final payment of the $1,000 loan. In need of money, the cousin cashed the check and demanded the remaining $810 from Sam. Sam refused to pay, claiming that they had entered into an accord and satisfaction that discharged Sam's obligation to pay anything more. The cousin sued Sam. Discuss the probable outcome. Discuss fully.
Sam would be liable to pay the remaining $810 because the accord agreement would not uphold against a good faith. Sam might have wrote in big letters on the check that it was the final amount, but for a few reasons that does not release liability for him to pay. The first reason being he did not include in his big letters that "If this check is cashed, then that will result in a mutual agreement that this is the only and final repayment on the loan of 1,000". Without specifically stating that, there is no agreement, he is just simply trying to state that he is not paying anymore; however that does not mean he is not liable to. It States in 18-3b that for an accord and satisfaction that "to substitute for an existing debt with some alternative form". This is not an alternative form, he is just simply underpaying for the debt. I beleive the cousin would win suit.
Jones and Clark entered into a written contract for the purchase of an apartment building by Clark. The contract was carefully drafted to set forth the agreement of the parties. It was signed by both parties. Clark subsequently claimed that the contract did not cover all the terms included in the written and oral agreements that the parties had made during their prior negotiations.Jones claimed that the parol evidence rule barred proof of all of their prior agreements. Which claim would be upheld in court? Argue both sides.
The parol evidence rule states in 16-2a that "The general rule is that parol or extrinsic evidence will not be allowed into evidence to add to, modify, or contradict the terms of a written contract that is fully integrated or complete on its face.*Links to an external site. Evidence of an alleged earlier oral or written agreement within the scope of the fully integrated written contract or evidence of an alleged contemporaneous oral agreement within the scope of the fully integrated written contract is inadmissible as parol evidence." This essentially means that the parole evidence rule protects the written contract and both parties from the other from potetially trying to receive damages from the other by saying there was an oral agreement before the written contract. The written agreements should be carefully written and understood by both parties before signing, this question states it was. Therefore; Clark should have made sure that the oral agreement part was also included in the written agreement to make sure that Jones would uphold it. I believe Jones claimes will be upheld in court. On the other hand, in 16-2b it states "A contract apparently complete on its face may have omitted a provision that should have been included. Parol evidence may be admitted to show that a provision was omitted as the result of fraud, duress, or mistake and to further show what that provision stated.". Clark could make the evidence admissable if he can prove that there were parts of the written contract that are missing.
On April 15, Morgan sent a letter to Clark offering to sell her business to Clark for $200,000. The offer stated that it would expire on May 1. On April 30, Morgan sent another letter to Clark that stated that she was withdrawing the offer. Clark received that letter on May 1. Also, on April 30, Clark sent a letter to Morgan accepting the offer. Morgan received that letter of acceptance on May 1. Morgan refused to sell the business to Clark, claiming that no contract had been formed. Clark brought suit to enforce the contract against Morgan. Based on what you have learned in this chapter, decide the probable outcome of the case.
The probably outcome for this particular case would be in favor of Clark. He had mailed his acceptance before receiving the revocation of Morgan; therefore, Morgans counterclaim would be dismissed due to the Mailbox rule. When Clark sent the letter on April 30th, before being able to receive the revocation, the contract was in fact formed at that point and would stand valid in the court of law. It is also important to know that the date the mail was sent is important, because the offer did expire on may 1st when Morgan received the letter; however, Clark had mailed it the day before which was before the expiration date.
