Business Law and Ethics - Case Study Example

If I were the judge I would find that an enforceable business contract exists, despite Jack Johnson’s protestation, there is no written contract. A contract is based on offer and acceptance (agreement): Both parties agreed to go into a specific business at a 25/75 percent responsibility and profit. This constitutes a meeting of the minds as set forth in Baltimore & Ohio Railroad Co. v. the United States, 261 U.S. 592 (1923). Another factor is a consideration: Both parties contributed money to the business.

Hoffman v. Red Owl Stores, Inc., 133 NW 2d 267 (1965) is a Promissory Estoppel. A Promissory Estoppel is when a negotiating party who strings along the other party with prolonged negotiations is liable for losses incurred even if no contract is eventually concluded. This would not work here, because no prolonged negotiations were a factor. After finding that the basis of a contract existed, the contract would be voidable on Jamie Clark’s request due to Fraud in Inducement. Jack Johnson gave a fake name in order for Jamie Clark to enter into business with him.

Only Jamie Clark could answer if she would have gone into a business with Jack Johnson upon knowing his real name and background. By using a fake name, Jack made a misrepresentation of a material fact, which under the law is Fraud in Inducement.  I would order a rescission. Jamie Clark would receive the $25,000 she invested into the business venture back. Any outstanding bills incurred through the venture should be picked up by Jack Johnson since Jamie Clark needs to be made whole.