Business and Contract Law in the USA - Essay Example

Business Contract: Introduction: This paper analyzes the key elements that make it possible to enforce a contract. In achieving this objective, this paper looks at four major cases that involve contract negotiations and enforceability. These cases are; 1. Jacobs and Young, vs. George E Kent. 2. Clintons Jones vs. Star Credit. 3. Osprey llc vs. Kelly Moore paint. 4. Brain J. Donovan vs. RRL Corporation. By looking at these common laws, this paper identifies the facts of law, and principles that the courts interpreted and used for purposes of solving the disputes under consideration. By definition, a contract is a pact amongst two or more individuals, and it creates a give-and-take relationship, which is recognizable by law. For a contract to gain the protection of the law, it must satisfy the element of offer, acceptance, purpose to create legal representation, and there must be a consideration. Under the element of offer, a promisor invites a promisee to a responsibility and he makes it in such a way that he expects an acceptance from the promisee1. For example, person A offers to rent out his building to person X, for business purposes. In this example, “responsibility” is denoted by the building that person A wants to rent to person X, for business purposes. In acceptance, a promisee agrees to take up the responsibility offered by the promisor. For example, after person A offered to rent out his building to person X, person X agree to become a tenant under the conditions offered. This amounts to acceptance. For a contract to exist, it must be legally binding document. It must be recognizable by the law, and its provision acceptable by the legal principles of the nation. Finally, a valid contract must have some values exchanged, and this is termed as consideration. For instance, take our case above. He can pay either in cash, or through some valuable products. This paper also identifies the public, social and business issues that influenced the courts in their rulings. This paper has a conclusion, which is a summary of the main points addressed2. Analysis: One key fact that relates to the enforceability of a contract is whether there is an element of substantial performance within a contract. This fact is better portrayed in the case involving, Jacob and Young vs. Kent (1921). In this case, the plaintiff did not build the house as per the contractual agreement with the defendant. However, the portion left was minimal, and redoing the work would have meant demolishing a large percentage of the whole building, and on this basis, the plaintiff refused to re-do it. The plaintiff won the case, as the court ruled that when there is a defect in contract performance, and it is minimal, then the concept of substantial performance applies. In this case, the standard that the court applied in measuring the damages that the defendant suffered is the differences in value of installing the new pipes, as opposed to the old pipes. The court denoted that differences would have amounted to zero, and therefore defendant would not have suffered losses. On this note therefore, the plaintiff fulfilled his contract, satisfying the element of substantial performance. The business concern that the court analyzed in this case, is whether the defendant suffered a loss or not. The court denoted that he never suffered a loss, and therefore he had to fulfill the provisions of the contract3. In Clintons Jones vs. Star Credit, the issue that comes about is the notion of unequal bargaining power in a contract. In this case, the plaintiff agreed to purchase a freezer whose total retail price was 1,234 dollars. However, they paid 619.88, and the defendant claimed the remaining 819.81 dollars. However, the real retail price of the freezer was 300 dollars, and the issue here was whether this was an unconscionable contract. The court ruled that this was unconscionable contract, and therefore refused to enforce it. The Uniform Commercial Code, under section 2-302 denotes that the court has a right to refuse to enforce a contract that is unjust, unfair and dishonest. In arriving at their decision, the courts looked at the provision of the Uniform Commercial Code 2-302, and the public policy and interests which was based on the protection of customers from greedy business men, and unequal bargaining power that was witnessed in the case above. In the law of contract, another factor that can make the courts to refuse to enforce a contract is when a mutual mistake arose on the offer. According to this principle, In Donovan vs. RRL Corporation (2001), a newspaper advertisement wrongly advertised the credentials of a car on offer by RRL Corporation4. When Donovan tried to buy the car, basing on the information from the newspaper, the RRL refused to sell. When he sued the company, the courts refused to enforce the contract basing on the notion that there was a unilateral mistake, and therefore the offer that existed was invalid. The court denoted that, enforcing the contract based on the erroneous price was unjust and unfair to the seller, and therefore this constituted an unconscionable. In this case, the concern was whether an advertisement constituted an offer, or an invitation to an offer. In Harris vs. Time (1987), the Californian Supreme Court denoted that an advertisement is simply an invitation to bargain, and not an offer5. However, an exemption arises when the advertisement advocates for the performance of a particular act. On this basis therefore, the newspaper advert on the case above was an offer, but an unconscionable offer. In Osprey llc vs. Kelly Moore paint, the issue that arises is the mode of accepting an offer, and the time involved. In this case, the issues that arose are the delivery of a contract, and the time involved. The court denoted that, using an alternative method of delivering or accepting an offer does not make the contract invalid, as long as the method serves the specific purpose intended to, and the time of delivery of the offer and acceptance is not disputed6. Conclusion: In conclusion, a court would not enforce a contract that does not prove that there was an element of substantial performance, that is unconscionable, that proves an existence of the element of mutual mistake, and whose mode of delivery is not as per the agreement within the parties involved, and does not serve the purpose it was intended. Substantial performance means that the parties under the contract satisfied all their obligations, and if there is any part that they did not satisfy, then it should be minimal that the other party will not suffer lose as a result of it. A contract that is unconscionable is one whose provisions are unjust, unfair and dishonest, and they mainly benefit one party, at the expense of the other party. This type of a contract is void, and the courts cannot allow it to stand. A mutual mistake occurs when both parties do not have a role in the occurrence of the mistake, and it is always a unilateral mistake. On this basis, the court would not enforce such kind of a contract, because it is difficult to know whose mistake it is. Finally, a contract whose offer/ acceptance is delivered contrary to the agreed delivery method, but the alternate delivery system functions as the agreed one, then the courts can enforce it. Works Cited: Altbach, Philip G.. Paying the professoriate: a global comparison of compensation and contracts. 1. publ. ed. New York [u.a.: Routledge, 2012. Print. Emanuel, Steven. Contracts. 5th ed. New York: Wolters Kluwer Law & Business, 2012. Print. Fletcher, George P., and Steve Sheppard. American law in a global context: the basics. Oxford: Oxford University Press, 2005. Print. Klass, Gregory. Contract law in the USA. 2nd ed. Austin [Tex.: Wolters Kluwer Law & Business ;, 2012. Print. Read More