Reference no: EM133843990
Assignment:
Your assignment is to read the following hypothetical on the next slide and to answer both of the questions on the slide after that using the IRAC format we just discussed.
Your answer should be submitted in the discussion board below.
ASSIGNMENT:
A seller and buyer both collect comic books as a hobby. Both live in the same small city and are avid readers of magazines about the comic book industry. The seller placed an advertisement in a magazine seeking to sell for $50,000 an original Superman comic book published in 1940. On May 1, the buyer saw the advertisement and telephoned the seller to discuss buying the comic book. During this conversation, the seller and buyer agreed to a sale of the comic book to the buyer for $50,000 and also agreed that the seller would deliver the comic book to the buyer's house on May 4, at which time buyer would pay the purchase price.
The next day, May 2, the buyer changed his mind and decided not to buy the comic book. He signed and mailed a letter to the seller, which stated in relevant part:
I have decided not to buy the 1940 comic book that we agreed yesterday you would sell to me.
The seller received the letter on May 3, immediately telephoned the buyer and said, "I consider your letter of May 2 to be the final end to our deal. I will sell the comic book to someone else and will hold you responsible for any loss."
On May 4, the seller received a telephone call from another comic book collector. The collector had seen the seller's advertisement for the comic book and expressed an interest in buying it. After some discussion, the seller and the collector agreed to a sale of the comic book to the collector for $45,000. Because the collector lived in a distant part of the state, the agreement provided that the seller, at her expense, would arrange for delivery of the comic book by an express delivery service. The express delivery service that they selected charges $200 for deliveries of this type. The sale, the method of delivery, and the fee were all commercially reasonable. The seller acted in good faith in entering into this agreement with the collector.
On May 5, the buyer telephoned the seller and said, "I made a mistake when I sent the letter, and I will buy the comic book from you on the terms we agreed to. Come to my house tomorrow - I'll have the $50,000 for you." The seller replied, "You're too late. I've already sold the comic book to someone else." The seller then took the comic book to the delivery service and paid the $200 delivery fee. The delivery service delivered the comic book to the collector, who immediately wired the $45,000 payment to the seller. Two weeks later, the seller sued the buyer for breach of contract.
1. Is there a contract for the sale of the comic book that is enforceable against the buyer? Explain.
2. Assuming that there is a contract enforceable against the buyer and that the buyer breached the contract, how much can the seller recover in damages? Explain.