Business Law: Chapter Problems

Ryan Neiderhiser

11/17/2018

11.5: Beck v Haines Terminal and Highway co., 843 P.2d 1229(Alaska)

I believe Beck is liable for the paper he signed stating he promised to pay any debt the lumber company
owed Haines. Even though Beck signed "general manager" after his name, he was still signing that he
personally promised to pay the debt should it come due. Beck should have worded the paper to state
that he promises Chilkoot Lumber would pay the debt to prevent personal liability to the debt.

11.9:

Yes, Dozier should be liable to pay for the improvements. Even though he didn't approve of them, he
was aware of them and did nothing to stop them. Being aware of the improving with intention not to
pay because he didn't approve would have led to the unjust enrichment of Dozier. If Dozier didn't know
about the improvements until after they were done or stopped work from proceeding if he found out
while construction was underway then Dozier may have had a case to not be liable. Dozier being aware
of the improvements and allowing them to continue made him liable.

11.CPA1

Hammer would prevail against Kay based on (a) the unilateral contract. Kay made the offer to pay for
Hammer's education should Hammer find the rare pieces of art. Hammer completed his end of the
agreement by the performance of finding these rare pieces of art. The completion of the performance
of the contract makes Kay liable for Hammer's education as promised.

12.2: Overman v Brown, 372 N.W.2d 102 (Neb.)

I believe the decision should be for Overman. Even though Overman didn't sign on the reverse side they
still accepted the contact in a reasonable manner. I don't think "acceptance on reverse side" is a specific
enough instruction anyway to dictate that Overman needed to sign on the reverse side of the document
as the only way to accept terms of the contract.

12.4: Nelson v. Baker, 776 S.W.2D 52 (Mo. App)

I would decide for Baker. Baker made Nelson an offer for the home. Nelson then amended the offer
and told Baker he accepted the deal on those terms. Nelson's amending of the offer would make that
original offer void. Nelson's amendments would be considered a new offer and only enforceable if
Baker agreed to the new contract which he didn't. Nelson's actions show a severe lack of business
ethics which severely reduce the perceived integrity of Nelson's character.
12.CPA2

Fox and Summers don't have a binding contact because of (b) Fox's offer was a counteroffer. Summer's
initial offer was void by Fox's reply of a counteroffer. Summer never replied to the counteroffer
meaning that no contract was ever agreed to.

13.1

The salesperson didn't commit fraud because he didn't know the car had been in an accident. However,
he did commit negligent misrepresentation by not conducting research to find the answer to Lester's
question and instead provided him the answer that increased the value and chances of Lester
purchasing the car. This negligent misrepresentation by the salesperson would make the contract void.

13.4: Holland v. High-Tech Collieries, Inc.

I don't believe a take-it-or-leave-it stipulation would validate duress. There is the possibility of economic
duress should High-Tech Collieries needed that money to stay afloat and weren't able to get the loan
from any other sources. I don't believe that defense would hold up though as any deal that isn't
negotiable is take-it-or-leave-it and it was High-Tech's choice whether to enter the agreement or not.

13.CPA2

Egan will (a) be able to disaffirm the contract despite the fact that Egan was not a minor at the time of
disaffirmance. Egan gained majority just the day prior to disaffirming the contract. Law allows minors to
disaffirm a contract made while a minor anytime while still a minor and for a reasonable time after
gaining majority.

14.2: Hamer v. Sidway, 124 N.Y. 538

I believe the court should favor for the nephew. The uncle made a unilateral offer that the nephew
accepted by his performance of avoiding the activities listed by the uncle until he was 21. The executer
claims the contract was without consideration because the uncle received no benefit from the nephew's
performance and the nephew didn't suffer any detriment from avoiding the activities. However,
consideration also consists of forbearance which is refraining from doing an act that an individual has
the legal right to do. The uncle was essentially buying the inaction of the nephew from doing something
he was entitled to do and therefore makes the contract valid.

14.4:

Charles shouldn't owe Stan the extra $400 because it would be considered a gift and lacks consideration.
The tax refund was already finished and the contract completed when the gift of $400 was offered.
Charles wouldn't receive any extra benefit by giving the $400 and Stan didn't have to do any additional
work to receive the $400.
14.7: Atlas Construction Co., Inc. v. Aqua Drilling co., 559 P.2d 39 (Wyo.)

I believe the contract should be binding as Aqua filled their obligations to the contract. Aqua drilled the
well exactly as required and made no guarantee or warranty that water would be produced. Since Aqua
did everything they promised to do they weren't lacking consideration to the contract and Atlas should
be required to pay for services rendered.

15.7: Red Devil Firework Co. v. Siddle, 648 P.2d 468 (Wash. App)

Yes, the defense was valid. The contract was entered into with both sides knowing Siddle wasn't
permitted to purchase fireworks. The sale was illegal so this makes the contract void and
unenforceable. Neither side can sue the other for not performing on the contract.

15.8: Home Paramount Pest Control Companies, Inc. v. Shaffer, 718 S.E.2d 762 (Va.)

Even though the non-compete clause was signed, I believe the scope of the clause was too broad to
make it enforceable and the court should rule for Shaffer. It's stated that non-compete clauses must be
narrowly drawn to protect the employer's business interests, not unduly burdensome or geographically
restrictive, and has a reasonable time limitation. The specifics of this non-compete violated those
conditions to make it enforceable by its wide geographical limitations as well as the 2 year time
limitation.

15.12: Potomac Leasing Co. v. Vitality Centers, Inc., 718 S.W.2d 928 (Ark)

I don't believe this defense was valid. State statutes prohibited random sales solicitation from
automatic telephones but Potomac had no knowledge of the intended use of the automated phones by
Vitality. The act of leasing automated phones isn't illegal. Even the rules of partial illegality state that
should a contract contain promises that are illegal, the legal promises are enforceable. So the contract
for legally leasing automatic telephones should be enforceable.