Reference no: EM131249860
Mundo manufactures printing presses. Extra, a publisher of alocal newspaper, had decided to purchase new presses. Rep, a representative of Mundo, met with Boss, the president ofExtra, to describe the advantages of Mundo's new press. Rep also drew rough plans of the alterations that would berequired in Extra's pressroom to accommodate the new presses, including additional floor space and new electricalinstallations, and Rep left the plans with Boss.
On December 1, Boss received a letter signed by Seller, a member of Mundo's sales staff, offering to sell the requirednumber of presses at a cost of $2.4 million. The offer contained provisions relating to the delivery schedule, warranties,and payment terms but did not specify a particular mode of acceptance of the offer. Boss immediately decided to acceptthe offer and telephoned Seller's office. Seller was out of town, and Boss left the following message: "Looks good. I'msold. Call me when you get back so we can discuss details."
Using the rough plans drawn by Rep, Boss also directed that work begin on the necessary pressroom renovations. ByDecember 4, a wall had been demolished in the pressroom, and a contract had been signed for the new electricalinstallations.
On December 5, the President of the United States announced a ban on foreign imports of computerized heavyequipment. The ban removed-from the American market-a foreign manufacturer that had been the only competitor ofMundo. That afternoon, Boss received an email from Mundo stating, "All outstanding offers are withdrawn." In asubsequent telephone conversation, Seller told Boss that Mundo would not deliver the presses for less than $2.9 million
In a minimum of a 1,000-word contract analysis, discuss the following questions: Was Mundo obligated to sell the pressesto Extra for $2.4 million? Assume Mundo was so obligated. What are Extra's rights and remedies against Mundo?
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