|Type of paper:||Critical thinking|
|Categories:||Contract Business ethics Business law Business management|
The GC owners have questions and need clarification about several contract concepts and issues related to their new business. Specifically, they have questions about:
Statute of Frauds "writing requirement"
Discharge of a contract
Satisfaction of contract performance
Winnie and Ralph have asked you to prepare examples and explanations of these 3 areas of contract law.
To respond to the GC group questions and concerns, create facts scenarios and explanations to discuss with the GC owners.
TO: Winnie James, Ralph Anders
RE: GC Negligence, Risks and Liabilities
Dear Sir/ Madam
In regard to your request on clarifications on various issues based on contracts such as the statute of frauds, discharge of a contract and satisfaction of performance, below are some of the precise guidelines by Trademark Consultancy Firm that elaborate on the three areas of contract
1. The statute of Frauds- "writing" requirement
Hypothetical Scenario: Company X contracted via the internet with Windows Bright, a small window washing business in Missouri to purchase 4 cases of Shiny Lite window cleaning solution at $200 per case. Company X paid via the internet with a company credit card. The contract stated that the four cases of Shiny Lite would be shipped to Company X's place of business in Illinois via UPS.
A. Explain why the contract between X and Windows Bright is subject to the Statute of Frauds.
B. Will the internet electronic contract between X and Windows Bright satisfy the "writing" requirements for the Statute of Frauds? If so, how and why? Support your conclusion by referring to the specific UCC rule that applies.
Under the Statute of Frauds, parties should engage in a contract through writing and signatures as evidence of commitment. There are various contracts that fall under the statute which include; contracts for parties interested in real estates, those whose terms can only be performed for more than a year, contracts that involve one party is ready to clear a debt on behalf of another party, and contract that entails exchange of consideration upon promise to marry (excluding the mutual promise to marry). Additionally, under the UCC, the contracts that exceed more than $ 500 dollars also befall under the same statute.
Under the UCC there are various exemptions that parties can apply, which include; the Ten-Day-Reply-Doctrine, "Specially Manufactured Goods" doctrine, The "Admission" exceptions and the "Payment or Delivery and Acceptance" Exceptions.
In our case, we shall concentrate on the "Payment or Delivery and Acceptance" Exception. In this type of exception, the UCC requires that an oral contract for products that exceed 500 will endorse f the payment is already cleared and accepted, or if the products under the contract have been delivered and accepted (Uniform Commercial Code, Section 2-20l3) (c), (BMGT 380, Form and Meaning).
However, the statute gives the exemption that not all the contracts can be in written form but it requires that the contractual intent of the contract should be in written form and it should have the signatures of the parties to be bound to it.
In the case of electronic sales, the electronic signatures such as electronic sounds, symbols or processes that are related to the contractual document are acceptable. In our case, If Windows Bright has done all the purchase transactions required through the online, it has made the required payments to the GC 's cleaning products, it has received and accepted the goods, beyond doubts we can conclude the enforceable contract between GC and Windows Bright was legitimate. (BMGT 380, Form and Meaning)
2. Discharge of a Contract
Write a hypothetical facts scenario describing specific details of a contract between GC and a Barton Industries (a fictitious company), for which GC was to provide a roof and floor cleaning in Barton's large corporate office building each month for 3 months. Write the scenario facts so that GC could reasonably argue that GC should be discharged from performing on the ground of commercial impracticability.
The scenario must explain how/why the contract might be discharged for commercial impracticability.
A contract can only be discharged under two conditions; by full performance or by material nonperformance of the duty agreed upon. In the case of non-full compliance of full compliance, the duty may not be discharged since it is a breach of contract. In the case of incomplete performance, the contractor has the right to full payment while the owner is entitled to claim for the damages incurred. The decision to dismiss an obligation to perform under a contract is not an easy task. The responsibility to execute a deal can only be discharged only if the duty is approved to be difficult or becomes impossible. The dismissal can be based on the impossibility, common impracticability, commercial impartiality under the UCC and the dissatisfaction of purpose.
The UCC applies the concept of the common law concept of impracticability. (Uniform Commercial Code, Section 2-615). In case it becomes impossible to undertake a duty due to difficulty or unreasonable expenses it can also be exempted under the theory of common impracticability (BMGT 380, Discharge of Contract Duties).
In our case, commercial impracticability would be applicable if only the Barton Industries roof has become weary and is contaminated by asbestos. The GC manager might have done a visual check since he or she was not capable of climbing up the roof before signing the contract. The GC can request for discharge since from the cleaning contract if the cleaning exercise is considered unsafe for its employees.
3. Satisfaction of performance
Would you advise GC to include a satisfaction clause on their contracts with cleaning clients? Why or why not? Fully explain and support conclusions
There are some contracts that are undertaken to satisfy only one party. When the buyer burs a product from a seller, the objective is to obtain reasonable satisfaction from the performance of the item. Courts rely on this standard when resolving cases related to the sale of mechanical products whose performances have proven faulty. The court can only uphold that the obligator has performed if the products have indeed satisfied the obligee.
In the case of GC, I would not discourage the company to add the satisfaction clause in their contract. This is because the organization is only dealing with services, unlike goods whose performance on objective measurement is possible.
BMGT380. Digital Textbook (2018). Chapter 13. Form and Meaning. Retrieved 20th September 2018, from https://saylordotorg.github.io/text_law-for-entrepreneurs/s16-form-and-meaning.
htmlBMGT380. Digital Textbook (2018). Chapter 15. Discharge of Contract Duties. Retrieved 20th September 2018, from:https://saylordotorg.github.io/text_law-for-entrepreneurs/s18-01-discharge-of-contract-duties.html
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