Posted: November 9th, 2022

Law
Topic:
SCENARIO: Did Jim and Laura Buy a Car?

SCENARIO: Jim and Laura Buyer visit the local car dealership because they are interested in buying a new car. The car they currently have is aging and is starting to have mechanical problems. Jim and Laura would share the new car, and use it to go back and forth to work and school. Before going to the dealership, Jim and Laura decide that they can only afford $400.00 a month in car payments.

Once at the car dealership, Jim and Laura meet Stan Salesman. Stan shows them several vehicles and Jim and Laura test-drive several of the cars. Jim and Laura particularly like the blue 4-door sedan. Therefore, they agree to give Stan Salesman a $100.00 deposit to hold the car for a day. Stan Salesman does not give them the receipt but guarantees that the $100.00 is refundable. No documents were signed.

The next day, Stan Salesman calls Jim and Laura to ask them when they would like to take delivery of the car. Jim and Laura, on the way home from the dealership, decided that they were not going to buy the car because they did not want to spend that money each month. Therefore, Jim and Laura tell Stan Salesman that they have decided not to buy the car and request their $100.00 deposit back.

Stan insists that the $100.00 was a deposit on the car and was meant to be part of the contract to buy the car. Stan is very persistent and insistent that Jim and Laura have contracted to buy the car; therefore, the $100.00 will be applied to the purchase price of the car. Jim and Laura are shocked and angry as not only do they not want to spend the money, but now feel as though they are being duped by Stan Salesman.

Jim and Laura have an appointment to see a lawyer in a few days, but know you are a student taking a business law class and come to you for advice. They are very frazzled, and understandably upset that they may have just purchased a car. Since you have been taking business law, you have read and understand the elements of a contract and the defenses to a contract. Therefore, although you are not a lawyer, you provide some basic advice from what you’ve learned in your business law class.

ASSIGNMENT: In three to five (3-5) pages, advise Jim and Laura based on the above facts as presented, the material provided in the text, and material covered in the lecture. In your paper, be sure to address the following:

1. Define the elements of a legal contract using examples from the scenario where applicable.
2. Decide whether or not there was a contract for the purchase of the automobile.
3. Identify the facts from the scenario which support your decision on whether or not a contract exists for the purchase of the automobile.
4. Use at least two (2) quality academic resources in this assignment. Note: Wikipedia and other websites do not qualify as quality academic resources.
A. Assignment Guidelines

DIRECTIONS: Refer to the list below throughout the writing process. Do not submit until it meets these guidelines.

1. Understanding of Contract Law
❒ Have you defined the elements of a legal contract?
❒ Have you used examples from the scenario to illustrate these elements?

2. Case Judgment and Support
❒ Have you provided a judgment on the existence of a contract in this scenario?
❒ Have you used specific examples from the scenario to defend your position?

3. Research
❒ Have you referenced at least two academic sources in your essay?
❒ Have you explained how each source relates to and supports your judgment on the case?

B. Requirements
The following requirements must be met for your submission to be graded:
• Composition must be 3-5 pages (approximately 750-1250 words).
• Double-space the composition and use one-inch margins.
• Use a readable 12-point font.
• All writing must be appropriate for an academic context.
• Composition must be original and written for this assignment.
• Plagiarism of any kind is strictly prohibited.
• Submission must include your name, the name of the course, the date, and the title of your composition.
• Include all of the assignment components in a single file.
Disclosure is an important aspect in contract law that ensures contract’s enforceability. Contract is an agreement that is enforceable before the court of law. It compels the promisor to provide to the promisee terms and conditions that are fair and justified before the law. This takes into consideration a number of facts to ensure contract enforceability. For a contract to be enforceable it needs to feature the following four key elements. The contract needs to feature a form of agreement. An agreement must feature an offer and a form of acceptance. In this regard, one party must offer to enter into a legal agreement with another party and give the other party a chance to accept its terms (Miller, 2016). The offer must show the intentions of the contract and provide adequate communication to the offeree. Consideration is the second most important element that is taken into account within the contract law. Here the promisor must not coerce the promisee to enter into an agreement with them. Rather, they need to give them sufficient reasons to enter into an agreement.
The promisor is compelled to offer the other party all the details of the contract that are necessary to their participation. They may be required to disclose to them factors that may harm them or their interest in the process of enforcing the contract. Eisenberg (2003) identifies that a seller is required to disclose relevant information in an agreement especially if the said agreement is made through improper means. These elements under the disclosure principle are relevant information that brings to light facts of a contract to a promisee with an aim to not intentionally deceive them. Both parties entering into a contract are required to have the contractual capacity to fulfill the task at hand. This reinforces the need for disclosure before the contract is enforced.
If a promisee holds a mistaken tacit assumption about the material facts of a contract, there is a higher likelihood of them being taken advantage off by the promiser. As such, disclosure provides all the necessary information for contractual agreement to go forth. Finally, a contract can only perform if its enforced under law. In this regard the law compels a contract to only function in the event that it does not circumvent the law but advocates for public policy (Miller, 2016). A contract can only be enforceable in the event that the offeree accepts the terms of an offer. Acceptance is the voluntary assent to the terms of a contract by either signing, paying for a service, verbal communication or use of authorized means of communication (Beatty, Samuelson, and Sánchez Abril 2009). Silence as Acceptance can never be recognized under the law, even if the offeror addresses silence as a means of acceptance, within the USA, the law does not advocate or recognize silence as a means of acceptance (Miller, 2016).
Stan Salesman action are tantamount to misrepresentation of actual facts of the contract. There was no contract established for the purchase of the automobile. Laura and Jim agreed to give stand 100 dollars as a deposit to hold the car for a day. Stan additionally identified to them that the $100.00 deposit was refundable to them when they needed it, as such, they were of the intention that the money would get back to them as soon as they time established elapsed.
Lease is a form of contract within the United States. Like all contracts the lease needs to fulfill all the four critical element of the contract to ensure that it fits the definition of a legal agreement. These elements require the lease to provide an offer and wait for an acceptance, give the party enough consideration of the contract, be legal before the law and take into account both parties capacity to fulfill the elements within the contract. One great consideration that goes into deciding whether Laura and Jim failed to fulfill their obligation would be in determining whether the behavior of the party failing to perform their obligation conforms with standards of good faith or fair dealings (Posner, 2009). They did perform in good faith and Stan Salesman is the person that did not live up to his expectation.
Laura and Jim agreed to give Stan Salesman the $100.00 deposit with the hope that they would hold the car for them for a day. Stan identified to them that the amount was refundable. How does the agreement fail to meet the expectation? One Stan failed to give them the receipt, he assured them that it was not necessary giving them a guarantee that the amount was “refundable” to them. To this fact, Laura and Jim only agreed to this with the intention that they would be able to get their money the in the event that they wanted it again (seeing that it was refundable). The considerations made by Laura and Jim only covered the fact that the transaction made was refundable and not a deposit or down payment for leasing the car.
Stan’s claim that the amount was meant to be the first deposit on the car, does not meet adequate disclosure terms required to sign the lease. Laura and Jim were led to believe that the amount was due to them when they needed it as a refund. There was no offer and no acceptance proffered in regard to leasing the car. There was no receipt given intentionally by Stan and instead, he implied to them that it was not as necessary. This qualifies a misrepresentation. Had there been an offer and a chance to consider the terms by Laura and Jim (seeing that they went to the dealership with the intentions of buying the car) and an acceptance before placing the $100 deposit on the lease for the car, then this would have qualified as a lease contract. But there was non. They only agreed to Stan holding the car for a day as they made a decision. Which they contacted him the next day to identify that they, after all, did not require the car.

References
Beatty, J., Samuelson, S., & Sánchez Abril, P. (2009). Introduction to business law (3rd ed.). Cengage Advantage.
Eisenberg, M. (2003). Disclosure in Contract Law. California Law Review, 91(6), 1645. https://doi.org/10.2307/3481400
Miller, R. (2016). Business law today; Essential Texts and Case Studies.
Posner, E. (2009). Fault in Contract Law. Michigan Law Review Symposium: Fault In American Contract Law, 107(8), 1431-1444. Retrieved 5 September 2020, from https://www-jstor-org.sbcc.idm.oclc.org/stable/40380336.

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