Reference no: EM133200168

Assignment - Legal Environment of Business Contract Law Discussion

ASSIGNMENT - Select one of the options below and answer the respective multiplechoice question while providing your rationale for your decision as to why your choice is more correct than the other options. There is no page minimum or limit, but your grade will be based on the depth of analysis, (i.e., is your answer supported by thoughtful analytical reasoning and supported by law and facts?). Use of the IRAC method is not required but may be helpful in generally organizing your response. Please call or email if you have any questions or concerns.

Option 1 - Gina, a home renovator/flipper asked Bob the woodworker to build a black oak bedroom set. They entered into a written contract, with a contract price of $9,500 to be paid upon the decorator's receipt of the bedroom set. When the work was completed, Bob shipped the furniture to Gina. After inspecting it, Gina felt that it was not of the same high level of workmanship as she was expecting, given the other furniture that Bob had previously showcased in his showroom, and a good faith dispute arose between the parties as to the workmanship. Gina sent Bob the woodworker a check for $5,000 marked "payment in full." Upon receipt, Bob the woodworker endorsed and cashed the check, then sued Gina to recover the $4,500 balance.

What would most courts likely hold?

a. Bob the woodworker's cashing of the check constituted an accord and satisfaction, discharging the decorator's duty to pay the balance.

b. Bob the woodworker can recover the $4,500 balance from the decorator.

c. Bob the woodworker is estopped to sue for the balance because he cashed the check knowing that it was being tendered in full settlement.

d. Bob the woodworker's indorsing a check so marked constituted a written release, thereby discharging the contract.

Option 2 - The owner of ACME Co. a manufacturing factory that uses wingnuts in making its products and a wingnut supplier entered into negotiations over the telephone and, after a time, reached a general understanding that the ACME would buy wingnuts from the wingnut supplier. Following their conversation, the wingnut supplier sent ACME a contract, which he had already signed, agreeing to sell 1,000 wingnuts to the ACME for a total contract price of $20,000. Upon receipt of the contract in the mail, an authorized ACME representative signed the contract and deposited an envelope containing the contract in the mailbox located in front of his workplace. Before the wingnut maker received the contract, ACME had a change of circumstances. The ACME representative telephoned the wingnut maker and told him that he could not afford to buy the wingnut he had ordered, and he was "not interested in that contract we talked about." The wingnut maker replied, "That's all right, I understand. Maybe we can do business some other time." The next day, the signed contract was delivered to the wingnut maker's office. The wingnut maker, also having had a change of mind, decided that he wanted to enforce the contract.

Is the contract enforceable against ACME?

a. Yes, because the acceptance occurred prior to rejection.

b. Yes, because of promissory estoppel.

c. No, because the offer to rescind was accepted and that discharged the original contract.

d. No, because the rejection by telephone voided the acceptance by mail.