Reference no: EM13878508

Use the IRAC and solve the following cases-

1. Condition Precedent. Just Homes, LLC (JH), hired Mike Building & Contracting, Inc., to do $1.35 million worth of renovation work on three homes. Community Preservation Corporation (CPC) supervised Mike's work on behalf of JH. The contract stated that in the event of a dispute, JH would have to obtain the project architect's certification to justify terminating Mike. As construction progressed, relations between Mike and CPC worsened. At a certain point in the project, Mike requested partial payment, and CPC recommended that JH not make it. Mike refused to continue work without further payment. JH evicted Mike from the project. Mike sued for breach of contract. JH contended that it had the right to terminate the contract due to CPC's negative reports and Mike's failure to agree with the project's engineer. Mike moved for summary judgment for the amounts owed for work per-formed. Mike claimed that JH had not fulfilled the condition precedent-JH never obtained the project architect's certification for Mike's termination. Which of the two parties involved breached the contract? Explain your answer.

[Mike Building & Contracting, Inc. v. Just Homes, LLC, 27 Misc.3d 833, 901 N.Y.S.2d 458 (2010)] (See page 333.)

2. Liquidated Damages and Penalties. Planned Pethood Pusl, Inc., is a veterinarian-owned clinic. It borrowed $380.000 front KeyBank at an interest rate of 9.3 percent per year for ten years. The loan had a "prepayment Penalty" clause that clearly stated that if the loan was repaid early a specific formula would 1k' used to assess a lump-sum payment to extinguish the obligation. The sooner the loan was paid off, the higher the prepayment penalty.

After a year, the veterinarians decided to pay off the loan. KeyBank invoked a prepayment penalty of $40,525.92, which was equal to 10.7 percent of the balance due. The veterinarians sued, contending that the prepayment requirement was unenforceable because it was a penalty. The bank countered that the amount was not a penalty but liquidated damages and that the sum was reasonable.

The trial court agreed with the bank, and the veterinarians appealed. Was the loan's prepayment charge reasonable, and should it have been enforced? Why or why not?

[Planned Pethood Plus, Inc. v KeyCorp, Inc., 228 P.3d 262 Colo.App. 2010)] (See page 354.)

3. Spotlight on Goods and Services- The Statute of Frauds.

Fallsview Glatt Kosher Caterers ran a business that provided travel packages, including food, entertainment, and lectures on religious subjects, to customers during the Passover holiday at a New York resort. Willie Rosenfeld verbally agreed to pay Fallsview $24050 for the Passover package for himself and his family. Rosenfeld did not appear at the resort and ever paid the amount owed. Fallsview sued Rosenfeld for breach of contract. Rosenfeld claimed that the contract was unenforceable because it was not in writing and violated the UCC's Statute of Frauds. Is the contract valid? Explain.

[Fallsview Glatt Kosher Caterers, inc. v. Rosenfeld. 794 N.Y.S.2d 790 (N.Y.Super. 2005)] (See page 386.)