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omplete&nbsp;the Contract Creation and Management&nbsp;Simulation involving a contract issue and associated legal issues.

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Write&nbsp;responses to the decision points embedded in the simulation.

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Business Standards Transcript

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Speaker
:&nbsp;
Narrator, Robert Bob Johnson, Michael Smith

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Narrator:&nbsp;
Bob is a local used-car dealer and he’s feeling pretty good at the moment. He’s about to close a great deal with another used-car dealer, Mike.&nbsp;&nbsp;Mike has agreed to pay Bob more than he expected for a like-new car on his lot. The car’s on consignment from its owner, Al. Bob and Mike had talked about the deal over the phone and e-mail. During Mike’s visit to Bob’s dealership they settled on a final figure of $25,000.00. Once Bob received the payment, he would then write a check to Al for $22,000.00 and keep $3,000 as a consignment fee. All he had to do was say yes.

Mike:&nbsp;
Sounds great. I can’t believe you’re letting this go for so little. I mean for $25,000 (pause) I feel like I’m stealing.&nbsp;&nbsp;

Bob:&nbsp;
Yeah, right?

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Mike:&nbsp;
Take care.

Questions:

Contract Creation:

To enforce a contract, the following four requirements must be met. Determine if each requirement has or has not been met, the explain your answer.

Offer: Met or Not Met, Why or Why Not?

Acceptannce: Met or Not Met, Why or Why Not?

Consideration: Met or Not Met,&nbsp;
Why or Why Not?

A Lawful Object: Met or Not Met,&nbsp;
Why or Why Not?

Do the parties have a contract at this point?

Yes or No? &nbsp;Why or Why Not?

Does U.C.C. Article 2 (Sales), Section 201 apply in this situation?

&nbsp;Why or Why Not?

Consider the two choices. What choice would you make if you were Bob?

1. Ask Mike to sign a written contract?

2. Move forward, because each side mutually understands the terms.

Are you satisfied with how the contract is written? (see contract below)

In consideration of &nbsp;the mutual promises and other valuable consideration exchanged by the Parties as set forth herein, Buyer agrees to buy, and the Seller agrees to sell the property hereinafter described; and the Parties, intending to be legally bound, hereby further agree as follows:

A. Description of Procured Vehicle

&nbsp; 1. Make: Toyota

&nbsp; 2. Model: Corolla / S Series (1.8 L 4-cyl 4AT)

&nbsp; 3. Body Type: Sedan

&nbsp; 4. Body Color: Classic Silver Metallic

&nbsp; 5. Year: 2012

&nbsp; 6. &nbsp;Miles: 8,561

&nbsp; 7. &nbsp;Vehicle Identificiation Number (VIN): JT4RN38S5D0578903

B. Consideration

&nbsp; 1. Purchase Price: The purchase price is to be remitted by Buyer to Seller for the Procured Vehicle is $25,000 US Dollars.

Narrator:&nbsp;
The next day when Mike got into his office, the phone rang.

Bob:&nbsp;
Hey Mike, this is Bob. Hey, I know you were going to write me a check for $25,000, but could you write two checks instead? (Pause) One for Al for $22,000 and one for me for $3,000.

Narrator:&nbsp;
Mike thought about it for a moment and came back with an unexpected response.&nbsp;

Mike:&nbsp;
I’m going to have to reject your counteroffer, Bob. (Pause) No, we HAD a deal but you just rejected my original offer. (Pause). Look, there’s nothing on the table from my side anymore. (Pause) I tell you what? I’ll give you $20,000.

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[End of Audio]

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Can Bob enforce te original terms?

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Yes or No? Why or Why Not?

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Did Bob’s suggestion constitute a counteroffer? Or was it simply an offer to modify an existing contract?

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Yes or No? Why or Why Not?

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