Communication practice

Act out the problem 1

1. PROBLEM: Along a beach a child is swept out to sea by a sudden wave. The frightened mother screams out, «Save Timmy! I'll give you anything if you save him!» You swim and rescue Timmy. Then you ask for $10,000. Is there a legal basis for collecting?

Solution: There is no legal basis for collecting when Timmy is rescued.

Act out the problem 2

2. PROBLEM: Collins orally agreed to buy a mini-warehouse from Stein. Over the telephone, Collins then persuaded Keith to promise to lend $100,000, which Collins needed for the down payment on the purchase price. A mortgage (claim on the property) was to be given to Keith as security for the loan. Collins and Stein then signed the sales contract. Early the next day, Collins was stunned when Keith said that the loan could not be made as promised. Can Collins force Keith to make the loan? Is the sales contract with Stein enforceable?

Solution: The written agreement between Stein and Collins is enforceable. However, the oral agreement between Stein and Collins is not enforceable. Also, the oral agreement between Keith and Collins would not be enforceable. The two oral agreements pertained to an interest in real property-one an agreement to buy a building, the other an agreement giving a mortgage on the building. Thus, they were insufficient because they were not in writing and properly signed.

Act out the problem 3

3. PROBLEM: Rissan walked into a telephone booth, dropped some coins into the telephone, and dialed a number. No words were spoken until the party answered. A conversation followed between Rissan and the party. A few minutes later Rissan hung up the receiver and left. What kind of contract had Rissan made with the telephone company?

Solution: Rissan's contract with the telephone company was bilateral and valid. It was executory when the coins were deposited. It became executed when Rissan finished the conversation and hung up the receiver. As to formality, it was simple; as to method of creation, it was implied.

Act out the problem 4

4. PROBLEM: When the general manager of Special-Teas Sales Company hired Hudson as advertising manager for a five-year period, the two parties discussed the terms of employment and then they shook hands. As Hudson later recalled, his beginning salary was to be $3,000 a month but would go up annually if, and as, sales rose. At the end of the first year, Hudson expected a pay increase of at least $500 a month, but his pay did not increase at all. He threatened to quit. The manager admitted that sales were up; however, he claimed that expenses had also risen and therefore profits were down. He threatened to sue Hudson for breach of contract if he actually left. How could their misunderstanding have been avoided?

Solution: Dispute between Hudson and Special-Teas could have been avoided if their contract had been in the form of a signed writing with all important terms clearly spelled out.

Act out the problem 5

5. PROBLEM: Brandon bought a new car and wanted to sell her old car. She advertised in the local paper and Smythe agreed to buy the car for $885. He promised to pay for it when he received his paycheck in two weeks and to take delivery then. Must this contract be in writing to be enforceable?

Solution: If Brandon refused to sell, Smythe could enforce the agreement only if Brandon had signed a written agreement. Likewise, if Smythe refused to buy, Brandon could collect damages only if Smythe had signed.

Act out the problem 6

6. PROBLEM: In the city there were two streets with the name of «Highland.» Fisher owned the lot located at 231 Highland Avenue. Neece, who lived in New York City, wanted to buy the lot located at 231 Highland Boulevard. He wrote to Fisher, offering «to buy your lot on Highland» on specified terms. Fisher promptly mailed his acceptance of the offer. Was there a contract?

Solution: The parties' mutual mistake as to the identity of the subject matter made the contract void. Neece, in his offer, was referring to the lot on Highland Boulevard; Fisher, in his acceptance, was referring to the lot on Highland Avenue. Mutual mistake as to the existence of the subject matter has the same effect.

Act out the problem 7

7. PROBLEM: Simon wants to open a sporting goods store. She hesitates because she thinks the expenses would be prohibitive. She lists the costs of renting or buying a store, hiring help, buying a computer to keep records, buying a large inventory, obtaining a charter from the state, and paying for licenses and legal fees. Are her fears justified?

Solution: Simon’s fears are not justified. She should, of course, make a simple survey of the market and be satisfied that she has the ability, energy, capital and other requisites for success. Usually it is desirable to have experience as an employee in a similar business.

Act out the problem 8

8. PROBLEM : Ward and Chang organized and operated the Cinema Theater. They agreed to share profits and losses equally after paying all expenses. The land was leased from Alien for rent which was to be 6 percent of the gross revenue. Chamer was hired as manager for $ 1. 000 a month plus 3 percent of the net profits. Are all four partners in the business?

Solution: Ward and Chang were partners, but the other were not. Neither Alien nor Chamber owned part of the business. Their sharing of the gross revenue or net profits was merely a method of paying them rent and salary.

Act out the problem 9

9. PROBLEM: At the Big Department Store, the Aliertons signed a contract to buy a microwave oven. The store expected to receive the microwave from the wholesaler within 30 days. While shopping, the Aliertons left their car in the store's automobile service department to have the engine's idling speed adjusted and to have squeaks in the door eliminated. The charge for labor was $45; there was no charge for the lubricant. The service attendant recommended replacement of the car's tires and the Aliertons agreed. The cost of the tires was $200, plus $25 for balancing and installation. The Aliertons also bought a new battery for $59, and it was installed free of charge. Were all of these agreements sales?

Solution: The work on the car engine and the doors was strictly a contract for services; goods (lubricants) supplied were incidental, and no specific charge was made for them. The transfer to the Allertons of title to the tires was a safe of goods, even though a small charge was made for related labor. The battery was acquired in a sale of goods, with no charge for labor. The Allertons' agreement to buy a microwave oven at a later date was not a sale. Instead, it was a contract to sell.

Act out the problem 10

10. PROBLEM: Snow was an 84-year-old, somewhat senile widow lacking business experience. After investing an inheritance in a house for herself, she accepted Jane Wyles, a middle-aged stranger, as a boarder. Wyles lived there for two months. During that time, she was very attentive to Snow, who had become bedridden. Four weeks before her death, and mistakenly believing herself to be in need of money for hospitalization, Snow sold the house to Wyles. The price, paid in cash, was only one-third of the true market value. After Snow died, her children sued to have the agreement nullified. They claimed that Wyles had used undue influence on their mother. Will they succeed?

Solution: Undue influence did exist because of Snow’s physical and mental condition, and the gross unfairness of the sales contract. Snow’s children can sue Wyles to have the agreement nullified.

Act out the problem 11

11. PROBLEM: Benson was deep in debt and needed more credit to keep his business going. He gave Central Credit Controls (CCC) false information which showed his financial condition to be good. Grant subsequently obtained a credit report on Benson from CCC. Relying on the report, Grant sold a computer and expensive software to Benson on account. Within a month, Benson became insolvent (unable to pay debts) and failed to make a payment. Grant then learned the truth about Benson's financial condition. Claiming fraud, Grant sued to repossess the equipment. Should he succeed?

Solution: Grant will be allowed to repossess the equipment.

Act out the problem 12

12. PROBLEM: Smith was fraudulently induced by Chapman to buy a painting. Chapman had described the painting as an authentic Van Gogh. Upon discovering the fraud, before payment or delivery, Smith notified Chapman that she was canceling the contract. Was she within her rights?

Solution: A defrauded party who has done nothing, like Smith, may cancel the contract and be released with no obligation to pay.

Act out the problem 13

13. PROBLEM: When Milliken sold a used car to Camacho, he told her that the car had been driven only 50,000 miles, had never been in an accident, and had the original paint. In fact, Milliken had stolen the car, set back the odometer from 90,000 miles, and repainted the exterior in the original color. Moreover, Milliken had stood between Camacho and the right rear end of the car. He did this so that she would not see a crudely repaired fender, which had been damaged in an accident. After Camacho learns the truth and if she can find Milliken, can she avoid the contract?

Solution: Milliken was a criminal who acted fraudulently. He lied about the car and actively concealed the damaged rear fender (заднее крыло). Accordingly, if Camacho could find Milliken, she could avoid the contract and sue for damages for the tort of fraud. Milliken should be prosecuted as a criminal, and the car should be returned to its true owner.

Act out the problem 14

14. PROBLEM: Milo contracted with Corrigan for the installation of a complete burglar alarm system for $2,900. The printed contract provided that Milo was to pay $900 down and the balance at $100 a month for twenty months. (Failure to pay any installment when due would accelerate the debt and make the entire balance due.) The payments were to be made on the first day of each month. Milo explained that he did not receive his paycheck until the tenth. Therefore, he said, he would prefer to make the payments on that date. Corrigan agreed and in the margin wrote in «tenth,» and initialed it on Milo's copy only. During the first month, Corrigan demanded the full balance when Milo failed to make the payment on the first day. Is Corrigan entitled to the full balance immediately?

Solution: Milo's payments were not due until the tenth of the month. The handwritten change to that effect made by Corrigan on Milo's copy of the contract superseded the printed version. It was not essential that Milo add his initials because he was the party benefited by the change. He could, and undoubtedly would, add his initials if requested or if the validity of the change were challenged.

Act out the problem 15

15. PROBLEM: Heywood wished to buy an electric guitar for $495 from the Music Shop. He lacked cash, and his credit rating was poor. Amaro, a professional music instructor, told the music store owner, « Heywood has a rare talent. He will soon earn the full price. But if he doesn't pay when payments are due, I will.» If Music Shop sells the guitar on credit and Heywood later fails to pay, is Amaro liable for the balance due?

Solution: Amaro's promise in unenforceable. That is because it is not in writing and signed by him. On the other hand, if Amaro had said, «Sell the guitar to Heywood, and I will pay you,» it would be a direct, primary promise to the seller. Amaro would therefore be liable even if this promise was oral.

Act out the problem 16

16. PROBLEM: Jim had a long conversation with his girlfriend, Rita, in the presence of her elderly father. Jim solemnly promised Rita and her father that if Rita would marry him, he would support the father if that ever became necessary. Rita agreed, and the couple married. Is Jim's promise enforceable?

Solution: Jim's oral promise was not enforceable.

Act out the problem 17

17. PROBLEM: Liddell was executrix and principal beneficiary of her father's estate. At the time of his death, the father owed his friend Clifton $2,500. Clifton urgently needed the money, but probate court rules would have delayed payment for at least six months. Therefore Clifton offered to accept $2,000 in full settlement, if the amount would be paid immediately. Liddell agreed in writing to pay Clifton immediately out of her own funds. Is this promise enforceable?

Solution: Liddell is personally liable for payment of Clifton's claim against her father's estate, since she agreed in writing to pay.

Act out the problem 18

18. PROBLEM: Julia was engaged in animated conversation with four other students on the steps of their high school. When a bell called them to class, Julia absentmindedly left a bag behind. The bag contained a pocket computer and other valuables. After class she posted an ad on three bulletin boards, offering $15 to anyone who would return her bag. Ms. Lehman, one of Julia's teachers, who had not seen the ad, found the bag and returned it. Is she entitled to the reward?

Solution: Ms. Lehman was not entitled to the reward.

Act out the problem 19

19. PROBLEM: For a college graduation present, an aunt promised to give Eileen two tickets for a Caribbean cruise with a friend of her choice. At the graduation exercises, however, her aunt gave her a kiss instead and said, “The stock market is down. Sorry, darling!” Although not likely to do so, could Eileen successfully sue her aunt for breach of contract?

Solution: Eileen promised nothing of value in exchange for her aunt's promise of the tickets. (A “thank you” and continued love and affection do not suffice as consideration in most states. That is because such things lack determinable market value.) Therefore Eileen and her aunt did not make a contract. Instead, the aunt merely promised to make a gift. Such promises are not enforceable.

Act out the problem 20

20. PROBLEM: Jameson is a partner in a highly successful partnership. She becomes liable for very heavy damages as the result of an automobile accident while vacationing. She therefore files for bankruptcy and has these and other debts discharged. What effect will this have on the partnership?

Solution: Bankruptcy, a kind of financial death, also automatically dissolves the partnership. This is true whether the bankruptcy is suffered by any of the partners (such as Jameson in the problem) or by the firm itself.

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