Scenario Review 1 SCENARIO REVIEW Scenario Review BUS 415 Business Law University of Phoenix Scenario Review 2 Scenario Review Scenario One Masterpiece Construction contracted with Foodmart to renovate the store on Main Street This contract contained a requirement that the renovation must be completed within a six month period Masterpiece could not complete the renovation within that time frame and subcontracted the job to another company Foodmart was unaware the Masterpiece had subcontracted the work out to another company and Foodmart was unsatisfied with the work being performed Foodmart was later informed by Masterpiece that Masterpiece had subcontracted the work to another company When Foodmart learned about the subcontracting they petitioned the court for an injunction and sued Masterpiece for breach of contract The reason that Masterpiece could not complete the job as stipulated by the contract was because they had taken on to many jobs at the time When Foodmart petitioned the court Masterpiece argued that they had the right to delegate the duties of the contract or to discharge the contract altogether because of commercial impracticability This first mistake that Masterpiece made is that they did not contact Foodmart to let them know that they were unable to meet the six month deadline In order for Masterpiece to have contracted the work out to a third party they would have needed to revise the contract to include contracting the work out to a third party Each party involved in the contract would have needed to accept the terms and conditions set forth in the contract The next problem is that the work performed by the third party was not Scenario Review 3 acceptable and unsatisfactory In order to be an enforceable contract there must be certain criteria met 1 An agreement usually between two parties 2 Be supported by legally sufficient consideration 3 be between parties with contractual capacity and 4 accomplish a lawful object Masterpiece entered a contract with Foodmart to perform a job because they overbooked themselves and could not complete the work as stipulated in the contract When they contracted the work out to a third party they voided the contract because the agreement was between Masterpiece and Foodmart This contract was also voided because it lacked the necessary consideration as stipulated for a contract to be in place Masterpiece argued that they wanted the contract dismissed because of commercial impracticability which could not apply in this case because the job could have been performed by Masterpiece if they had not overbooked themselves and failed to have the job completed in the allotted amount of time Unfortunately for Masterpiece Construction the contract is voided therefore not an enforceable contract and no doubt will be in breach of their contractual obligations Scenario Two Jeremy Atwater 17 years old spent his summer working for Brian McDonald in the produce department of Foodmart Jeremy worked hard and saved enough money to make a down payment on a car He went to Smooth Sales Used Cars to purchase a vehicle Jeremy made the down payment on a car and signed a contract with Smooth Sales to make payments of 200 each month Smooth Sales did not ask for proof of Jeremy reaching the age of majority and only assumed he had Six months later Jeremy lost his job and could not afford the payments on the car Jeremy then returned Scenario Review 4 the car to Smooth Sales wanting to cancel his contract and have his money returned Phoenix 2010 This scenario can seem to be cut and dry at first glance It would appear that both parties would have some fault in the contract Jeremy for entering the contract under age and not disclosing his age and Smooth Sales for entering the contract with a minor or asking for proof of age Phoenix 2010 Since Jeremy was underage it would seem that the contract would be void and Smooth Sales would have to take the car back Smooth Sales in this case would have to take the car back though not for the fore mentioned clause With no law that states a minor cannot enter a contract minors do lack contractual capacity Though both parties did not make a good business decision no fraud was committed by Jeremy for not stating his age or Smooth Sales for not asking Smooth Sales must take the car back and give Jeremy his money back according to the infancy doctrine The infancy doctrine allows minors to cancel most contracts they have entered with adults This right is based on public policy that reasons minors should be protected from the unscrupulous behavior of adults Under this doctrine the minor has the right to accept or void a contract and the adult party is bound to the minor s decision If the minor has transferred consideration such as money to the adult party then the adult party must put the minor in status quo This means they must put the minor in the same position as he or she was before the contract was entered In this scenario it means that Jeremy will be able to return the car and disaffirm the contract and Smooth Sales is obligated to take the car back and return Jeremy s money Cheeseman 2010 Scenario Review Scenario Three 5 In this scenario Brian spoke in general conversation when he told Harry he will sell his trains to Harry when he retires Upon hearing this Harry begins to build a special room for the trains going as far as to borrow money to finish this room When Brian actually retired he sold the trains to his neighbor James Harry wants to sue Brian regarding the promise he made to him about selling him the trains years earlier This could be considered an express contract as Brian explicitly told Harry he wanted to sell him the trains because he knew that he would take care of them In this scenario Harry has the right to sue Brian and may even claim they had an express contract but in order to execute an express contract there must be an agreement on both sides and an exchange of something tangible in this there was not Brian never mentioned a specific price for the trains that Harry agreed to and nothing was in writing to back Harry s claims of what Brian promised Harry may even explore the option of promissory estoppel but Harry must prove what the promise was and that as a result of this promise Harry suffered economic loss Harry can claim this because he went into debt to build the room but from a court s perspective this law would be applicable only if Brian had told Harry to build the room then he would sell him