LAW 122 Lecture 9: Business law 122 fact scenarios (class 9) winter 2016

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sangriarabbit133

3 Dec 2022

School

Ryerson University

Department

Law and Business

Course

LAW 122

Professor

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Document Summary

Dennis and carmen entered into a contract under which he agreed that, in one week"s time, he would pay 000 in exchange for her motorcycle. Three days later, however, he contacted her and said, look, as it turns out, my financial situation isn"t as strong as i thought it was. I wonder if you"d be willing to just call off our agreement? she replied, fine. You keep the money and i"ll keep the motorcycle. after considering the matter further, however, carmen called him back and said that she wanted the contract to be performed as initially planned. In fact, he insists that the contract no longer exists. If the parties" contract did come to an end, explain the process that was used to achieve that result. It was non-executory on both sides, since neither party had performed its obligations and the agreement to rescind was supported by consideration on both sides.

Related Questions

Plastic Co Pte Ltd (‘Plastico’) is a Fiji company. The company has issued and paid up capital of $250,000 held in equal parts by two brothers. The company’s business involves making plastic products for the local market.

The brothers are planning to emigrate to New Zealand and wish to sell the company. An agreement in principle is reached for X to buy the company for $1 million. This is a cash sale.

Presume that you are wealthy and a longtime friend of X.

X comes to see you. She explains that she has in hand $800,000 (from her own savings and bank financing) and is short $200,000 to close the deal. X wants you to loan her $200,000. X has two specific proposals as follows.

Proposal One

Plastico is an old company. When founded it established its factory on the outskirts of Suva. Since that time Suva has grown and spread with the consequence that the land on which the factory stands is today much more valuable than when the factory was built. X has had the land valued at $300,000.

X has found alternative factory premises on the outskirts of modern Suva that would be suitable for the company. These premises are for sale for $100,000.

X proposes that you lend her $200,000 for four months only. X will acquire Plastico. The company’s new directors, X and her husband, will have Plastico sell its current factory and relocate to the premises already identified. The relocation will provide net cash of $200,000. Plastico will then pay a dividend of $200,000. X will use the distribution to repay your loan.

Proposal Two

X proposes that you lend her $200,000. This will be a longer term loan of say 6 years to be paid down incrementally over the life of the loan. Plastico will retain its present factory premises. As security for the loan, Plastico’s new directors, X and her husband, will have Plastico grant you a first mortgage over the current factory premises. Given the valuation placed on the premises the loan will be almost risk free.

Further details of both proposals provide an attractive return for you on the financing.

Required:
Consider each proposal separately and in turn.
Does the proposal offend any of the capital maintenance rules?

[Note ‘agreement in principle’ refers to a situation where two parties have agreed on all the terms of a deal (i.e. contract) but have not yet formally committed to the deal. In this story the parties (X and the two brothers) will only sign the contact document detailing the agreement when X has lined up the required cash of $1 million.]

amethystpug972

or over five years, Rick was the CEO of JB Guitars Inc, a corporation operating a chain of retail guitar stores. He had gained tremendous practical experience and decided to start his own business selling guitars. When he first started working at JB Guitars, Rick agreed not to carry on a competing business for two years after he ended his employment with the corporation. To avoid breaching that contract, Rick incorporated a corporation named Generation X Guitars Inc to carry on the business. He is the sole shareholder, director, and president. JB Guitars claims that the new corporation is just a way of getting around the non-competition agreement and has sued for a court order prohibiting Generation X Guitars from carrying a business competing with JB Guitars. Will JB Guitars be successful?

indigotiger525

In 2019, Ms. Love visited the offices of Awesome Plastic Cosmetic & Laser Surgery Center, where she consulted with plastic surgeon, Thomas Awesome, M.D., regarding breast augmentation surgery. According to Ms. Love she informed Dr. Awesome that she wished to have her breast size increased. Specifically, she told him that she wanted to be a size 34C. Ms.Love asserts that Dr. Awesome assured her that the surgery would accomplish this goal.Dr. Awesome disagrees and states that he gave no assurances or guarantees regarding M.s Love’s post-operative breast size, other than to inform her that her "breasts would most likely be between a B and C cup post-operatively. Dr. Awesome explains that he never gives assurances or guarantees regarding breast size to any patient.

During the consultation, Ms. Love decided to undergo the procedure. She was given a six-page informed consent document. However, Ms.Lovey says that no one reviewed the document with her. She did read through the document as she was speaking to her husband on her cellular telephone. Ms. Love then initialed the first five pages of the document and signed the last page. It is undisputed that the document contains a disclaimer stating that Ms. Love acknowledged that "no guarantee has been given by anyone as to the results that may be obtained."

The surgery was scheduled for March 26, 2019. On that day, Ms. Love presented to Awesome’s office and was provided with another document, entitled "Consent to Operation," which again stated that no guarantees had been given regarding the outcome of the surgery. Although Ms. Love signed the document, she also reports that she was under the influence of drugs prescribed by Dr. Awesome and that the drugs made her so drowsy that her husband had to carry her in to the office.

Following the surgery, Ms. Love made follow-up visits to Dr. Awesome’s office. During one of those visits, she was give a piece of paper on which was written the size and style of bra that the doctor wanted Ms. Love to purchase. A review of the paper reveals that it had Dr. Awesome’s office address and telephone number type-set at the top. The paper had the following in hand-writing: "34C Cup Long Line Style 1805."

Ms. Love contends that following surgery and after-care, her breast size is less than a 34B. The surgery involved no complications, Ms. Love has healed well and has no medical symptoms or complaints. She filed suit against Dr. Awesome alleging claims for breach of oral contract.

Consider the case described above. Here is some more information: Remember how Dr. Awesome prescribed her drugs that made her unable to walk, such that her husband had to carry her? When Ms. Love read through her own medical record she found a notation by one of the nurses (who just happened to be Ms. Love's neighbor). That notation said, " Patient appears to be intoxicated; I have seen this behavior before and she is an alcoholic". Ms. Love is very upset by this statement. She tells you that she never drinks and that her altered state was due to the prescribed medication. Could Ms. Love sue the nurse for defamation? Are there any other intentional torts that could be alleged by Ms. Love based on the nurse's statement? What would she need to prove to succeed in such claims?

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LAW 122 Lecture 9: Business law 122 fact scenarios (class 9) winter 2016

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