ACTG 1P71 Lecture Notes - Lecture 6: Contract, Insurable Interest, Oral Contract

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ultramarinetoad324

15 Apr 2018

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Contract formation---whether or not there is a reasonable expectation the promise to be enforced. ---invitation to treat (is not offer, say make me a offer, if 20 people call say they accept you (cid:272)a(cid:374)"t (cid:374)ot (cid:373)ake (cid:1006)(cid:1004) (cid:272)o(cid:374)tra(cid:272)t, eg:i ha(cid:448)e a (cid:449)at(cid:272)h, s(cid:271) gi(cid:448)e (cid:373)e (cid:1005)(cid:1004)(cid:1004), s(cid:271) gi(cid:448)e (cid:373)e (cid:1005)(cid:1006)(cid:1004) . If it is a offer, when sb give 100, you should sell it)) vs. offer eg: on newspaper sell one car, it is a invitation to treat---a car to the public invitation find my dog give 500---an offer. --whenever the offer is accepted , the offer should be communicated- one dog one people----if the person who find the dog,he may not know you said you gave 500, you did(cid:374)"t gi(cid:448)e the money---you should give. --offer ends---at the end of specified time----if no specified time , the after a reasonable time(eg: the food in the restaurant, the stock market very fast)

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Peter wants to sell one of his cars that has a diesel motor tohis nephew Brett. Brett is eager to purchase the car but Brett doesnot realise that one of his uncleâs cars is diesel.

Peter writes a letter to Brett as follows:

âDearBrett,

I know that you are interested in buying one of my cars. I wouldlike to give it to you but I know that you wonât accept charity.Therefore I will offer it to you for $500 (I reckon it is worthabout $2,000). If I donât hear from you by this Friday I take itthat you are happy to buy it for $500. I will then drop off the carto your place on the weekend.â

Regards,

Peterâ

Brett does not see the letter and there is no furthercommunication between Peter and Brett.

On Saturday, Peter delivers the diesel motor car to Brettâshome. Brett arrives home to discover the letter and the car fromhis uncle. Brett realises the car is diesel and he does not reallywant the car. However, Brett decides the car is still useful andstarts driving the car to and from university. After three weeksdriving the car Brett decides that he will return the car. He hasnot yet paid Peter any money. Peter thinks Brett is ungrateful anddemands full payment.

Brett wants to return the motor car to his uncle. Peter is angrywith his nephew and he demands payment for the car. Peter says hewill lodge a small claim and sue Brett for the money. Brett statesâwe are family and you canât sue me.â

Explain whether the uncle/nephewrelationship has any effect on whether or not there is a bindingagreement. 6 marks)

On the same telephone call Brett also says to Peter that âThereis no contract because I never agreed to anything. Peter says âItâsa bit late to return the car now. Youâve been driving itaroundâ.

Has Brett accepted an offer from Peterto purchase the motor car? (4 marks)

On the same telephone call Peter says that âI was being nice toyou and offering you the car at âmates ratesâ.

Could $500 be valid âconsiderationâfor a contract to sell the diesel motor car? Explain why/whynot? (4marks)

Brett tells Peter on the same telephone call âEven if you canconvince the judge that there was an agreement, I can get out of itbecause I didnât know you had a diesel car and I never wanted adiesel car. I thought all your cars were petrolâ. Is it correctthat Brett can avoid contractual obligations on the basis of hismistaken belief? Why/why not? (6 marks)

whitechimpanzee473

Peter wants to sell one of his cars that has a diesel motor tohis nephew Brett. Brett is eager to purchase the car but Brett doesnot realise that one of his uncleâs cars is diesel.

Peter writes a letter to Brett as follows:

âDearBrett,

Regards,

Peterâ

Brett does not see the letter and there is no furthercommunication between Peter and Brett.

Explain whether the uncle/nephewrelationship has any effect on whether or not there is a bindingagreement. 6 marks)

On the same telephone call Brett also says to Peter that âThereis no contract because I never agreed to anything. Peter says âItâsa bit late to return the car now. Youâve been driving itaroundâ.

Has Brett accepted an offer from Peterto purchase the motor car? (4 marks)

On the same telephone call Peter says that âI was being nice toyou and offering you the car at âmates ratesâ.

Could $500 be valid âconsiderationâfor a contract to sell the diesel motor car? Explain why/whynot? (4marks)

brownherring315

Camille has developed a good network among those in the fashionindustry, especially the seamstresses who have been hired bywell-known celebrities. One day, Camille spoke with Sonya, theowner and Lead Seamstress for Shazam Clothing Industries. Shazam isa leading manufacturer of unique limited edition clothes inSilkadonia. Camille presented Sonya with her order to sew a limitednumber (500) of hot pink and black machine knitted sweaters with amatching knit hat. Each sweater was to have a number and CandieCardiganâs signature on a label sewn onto the bottom right side ofthe sweater. The hats would have the same label with matchingnumber to its sweater, but sewn on the right side of the turned uphat cuff. Sonya agreed to make each sweater and hat pair for $100.Camilleâs plan was to sell each set for $300 thereby making a $200profit per set. While discussing the type of yarn to be used,Sonyaâs cell phone rang. Sonya pushed a piece of paper and a colorpalette towards Camille and whispered âwrite the type of yarn youwant used and exact dye lotsâ and I will begin work on this rightaway. Camille did as requested, but forgot to give Sonya thetraditional 25 percent down payment. The down payment has alwaysbeen used to purchase the materials.

Sonya completed production of all 500 sweaters in record timeand has presented Camille with an invoice for payment for the same.At the bottom of the invoice, the words, âPayment Due Upon Receiptâwere written. Camille changed her mind about wanting the sweatersand hats, as she decided that the items would not be as profitableas originally anticipated. Sonya now comes to the law firm you workfor, P. Strami, and Hammond, Attorneys at Law, and wants to know ifshe has any recourse. Attorney Strami hands you the followinginstructions and asks that you draft a memorandum to himincorporating your research.

Dear Paralegal:

Please prepare a 2â3-page double-spaced memorandum in size 12Times New Roman font discussing the following in the orderpresented:

Please determine whether or not a contract has been formed usingthe basic contract principles of offer, acceptance, andconsideration. State whether or not any of the crucial parts of theinitial offer may be missing.
Further, please research whether or not Camille and Sonyaâs priorcourse of dealings has an impact on the partiesâ communications andwhether or not Sonya would be successful against CARDWARE Inc.should a breach of contract lawsuit be brought against her.
Do not forget to provide your legal research within yourmemorandum. You may use case law to make comparisons, yourtextbook, and reliable Internet research to provide in-textcitations for your work. Do not use Wikipedia.
Prepare your memorandum paying particular attention to thefollowing:

For confidentiality reasons, please prepare an APA formattedcover sheet with your memorandum. Do not forget to indicate whichunit the Assignment is for.
Be sure to avoid the use of first person. Instead, convey yourresearch utilizing third person.
Keep all font color consistent throughout. If you copy and paste alink and it is in blue, hover your mouse over the link, rightclick, and select âREMOVE HYPERLINKâ to keep the font color blacklike the rest of your submission.
Use size 12 Times New Roman font.
Utilize in-text citations. If a reference is listed in yourreference page, it must be included within the body of yoursubmission as well.
Prepare an APA formatted reference page.

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ACTG 1P71 Lecture Notes - Lecture 6: Contract, Insurable Interest, Oral Contract

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