Final Review LAW - Summary Fundamentals Of Business Law PDF

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LAW 1101Final Review Problems Lad Lauer, an attorney who has been in practice for 20 years, agrees to represent Acme Corporation, which is being sued by Coyote Company for breach of contract. Because the case does not seem to have the potential to generate big fees for Lauer, he does not spend much ...

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LAW 1101 Final Review Problems 1. Lad Lauer, an attorney who has been in practice for 20 years, agrees to represent Acme Corporation, which is being sued by Coyote Company for breach of contract. Because the case does not seem to have the potential to generate big fees for Lauer, he does not spend much time on it. As a result, Lauer neglects to raise either the Statute of Frauds or the statute of limitations. If either defense had been raised, Coyote’s claims against Acme would have been dismissed. Instead, Acme was found liable to Coyote for $4 million. Acme sues Lauer for negligence. Judgment for whom? Explain. Judgement for Acme. Negligence has three necessary categories: breach of duty of care, proximate cause, and an injury should result because of it. Lauer had breached duty of care by not looking into the case more attentively, he was careless and failed to find an appropriate defense that a reasonable attorney would have. The breach of duty of care was the proximate cause of the injury: the $4 million owed. 2. Emma and Roy are employed as sales persons for Lolas, an upscale women’s clothing boutique. Neither was hired for a definite period and each has an excellent sales record. The owner of Lolas terminated Roy, because she believed that women were more likely to buy clothes from female salespeople. Emma was terminated because she was regularly late to work. Assuming only these facts, explain, separately whether Emma or Roy would have any claim against Lolas. Considering that both were employed “at will” Roy has a claim against Lola because he was fired on the account of sex, which is a protective category by Title VII. Title 7 prohibits discrimination on actual sex. Emma has no claim against Lolas because she was fired simply because of her poor performance. At this point it is up to the employers. 3. Clinton, a vintage clothing retailer, sent the following letter to Stacy on January 3: “I promise to sell you my collection of rare vintage Victorian hats for $15,000. This is a firm offer that will be open until January 17 and will not be withdrawn before that date.” Stacy received the offer on January 5. On January 8, Clinton changed his mind and decided he did not want to sell the hats. He sent a letter to Stacy, which she received on January 11, in which Clinton stated that he was withdrawing his offer. On January 12, Stacy sent a letter to Clinton, accepting his offer. Due to delays in the mail, Clinton did not receive this letter until January 19. When Stacy went to Clinton’s store on January 21 to pay for the hats and arrange for delivery, Clinton said there was no contract and refuses to take payment or give the hats to Stacy. (a) In an action by Stacy against Clinton for breach of contract, judgment for whom? Explain. Judgement goes to Stacy. Clinton said explicitly with the correct wording and in signed writing, that it is a firm offer, which means that it is irrevocable until 1

January 17. Thus, his revocation means nothing and since Stacy sent an acceptance letter January 12, it became valid on that day, he is obliged to sell her the hats. (b) Assume that Stacy wins the breach of contract action. If Stacy wants the hats rather than damages, what remedy should she ask for? Explain. If Stacy wants the hats instead of monetary damages she could ask for specific performance to make both parties follow throughn with the contract. 4. Pablo lost his wallet on the subway. Maria found the wallet, and being an honest person, contacted Pablo and returned the wallet to him. Pablo was so grateful that he took Maria’s address and promised to send her a check for $250. Pablo never sent the check. (a) Maria sued him to enforce his promise. Will Maria be successful? Explain. Maria will not be successful because this is an oral promise based on past consideration, thus it is not enforceable. (b) Under what circumstances would Maria be able to enforce Pablo’s promise? Maria would be able to enforce Pablo’s promise if there was sufficient writing done before the action was completed, such as a reward sign posted up. 5. The following contracts were made on May 1, 2013. As to each, explain whether it is within the Statute of Frauds and, therefore, may need a writing to be enforceable. (a) Ann promises Boris that she will pay Boris’s June rent if he is not able to do so. Not within because this is a promise made to the debtor, not to a third party, so writing is not necessary. (b) Claudia hires Danielle to work for her for 6 months, beginning on January 1, 2014. Employment contracts become enforceable from the day they are made. Thus, since this would take more than a year to complete it is within and writing may be needed. (c) Evan agrees to lease his apartment to Flora for 6 months, beginning on January 1, 2014. This is not within because real property provision says that contract becomes enforceable from the day you start occupying it, which is less than a year (an exception) thus writing is not needed. (d) Garth agrees to buy Hillary’s car for $20,000. This is within because this is a sale of a good for over 500$ based on the UCC, thus writing will be required. (e) Ilya agrees to buy Jed’s house for $2,000,000. This falls under the real property provision which is within, thus writing is required. 6. On March 1, Sly of Slippery Sly’s Electronics Boutique sold a computer to Alex. In order to convince Alex to buy the computer, Sly told Alex that the computer contained the new Penta X chip. In fact, as Sly knew, the chip was really the slower and less 2

expensive Penta VI chip. Alex discovered this on April 30, when he tried to install the newly released game, Blood and Gore III, which was only compatible with the Penta X chip. However, Alex was busy working on term papers for school, so he continued to use the computer until June 1, when he graduated. On June 2, Alex sued Slippery Sly. (a) May Alex rescind his contract with Slippery Sly? Discuss, explaining whether Alex has any claim against Slippery Sly that might be the basis for seeking rescission of the contract. The first element of fraud is found here, where Slippery Slope had the intent to deceive, knowingly stressing false information: false representation of fact. Secondly, this false representation influenced Alex’s decision in whether he would buy the computer or not, so the second element is met. Lastly, damage was caused by this intent to deceive as he could not download the game. (b) May Alex recover damages from Slippery Sly? No because a sufficient amount of time has passed in between him finding out about the issue and him suing, but he can get money damages regardless: the amount he has overpaid). x 7. Mazie took her dog for a walk but failed to put a leash on her dog. The dog saw a cat and went running after it, crashing into and destroying the prize rose bushes of Mrs. Johnson, Mazie’s neighbor. Although the dog stopped after getting tangled in the rose bushes, the cat was so frightened it continued to run, eventually knocking over an outdoor grill on Elaine’s patio, three blocks away. Charcoal flew everywhere and started a fire in Elaine’s house. a. May Mrs. Johnson recover from Mazie for the damage to her rose bushes? Explain. Mrs. Johnson may recover from Mazie due to negligence. The first component has been satisfied as there has been a breach of duty of care: Mazie failed to put a leash on her dog. This breach of duty of care was the proximate cause of this, as the dog on the loose messed up the bushes directly. Lastly, the damage occurred as a result of this proximate cause: the bushes were destroyed. A reasonable person would know to put a leash on a dog. b. May Elaine recover from Mazie for the fire damage to her house? Explain. No, she cannot recover damages because this event is not reasonably foreseeable.

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