Question: Under what circumstances is the remedy of

> After submitting the high bid at a foreclosure sale, David Simard entered into a contract to purchase real property in Maryland for $192,000. Simard defaulted (failed to pay) on the contract, so a state court ordered the property to be resold at Simard’s

> Before buying a house, Dean and Donna Testa hired Ground Systems, Inc. (GSI), to inspect the sewage and water disposal system. GSI reported a split system with a watertight septic tank, a wastewater tank, a distribution box, and a leach field. The Testas

> Planned Pethood Plus, Inc. (PPP), a veterinary clinic, borrowed $389,000 from KeyBank. The term of the loan was ten years. A “prepayment penalty” clause provided a formula to add an amount to the balance due if PPP offered to repay its loan early. The ad

> Middleton Motors, Inc., a struggling Ford dealership in Wisconsin, sought managerial and financial assistance from Lindquist Ford, Inc., a successful Ford dealership in Iowa. While the two dealerships negotiated the terms for the services and a cash infu

> Lauren Barton, a single mother with three children, lived in Portland, Oregon. Cynthia VanHorn also lived in Oregon until she moved to New York City to open and operate an art gallery. VanHorn asked Barton to manage the gallery under a one-year contract

> Carnack contracts to sell his house and lot to Willard for $100,000. The terms of the contract call for Willard to make a deposit of 10 percent of the purchase price as a down payment. The terms further stipulate that if the buyer breaches the contract,

> Premier Building & Development, Inc., entered a listing agreement giving Sunset Gold Realty, LLC, the exclusive right to find a tenant for some commercial property. The terms of the listing agreement stated that it was binding on both parties and “their

> Dr. Jake Lambert signed an employment agreement with Baptist Health Services, Inc., to provide cardiothoracic-surgery services to Baptist Memorial Hospital–North Mississippi, Inc., in Oxford, Mississippi. Complaints about Lambert’s behavior arose almost

> Russ Wyant owned Humble Ranch in Perkins County, South Dakota. Edward Humble, whose parents had previously owned the ranch, was Wyant’s uncle. Humble held a two-year option to buy the ranch. The option included specific conditions. Once it was exercised,

> District in Bexar County, Texas, hired STR Constructors, Ltd., to renovate a middle school. STR subcontracted the tile work in the school’s kitchen to Newman Tile, Inc. (NTI). The project had already fallen behind schedule. As a result, STR allowed other

> David and Sandra Dess contracted with Sirva Relocation, LLC, to assist in selling their home. In their contract, the Desses agreed to disclose all information about the property—information on which Sirva “and other prospective buyers may rely in decidin

> Bath Iron Works (BIW) offered a job to Thomas Devine, contingent on Devine’s passing a drug test. The testing was conducted by NorDx, a subcontractor of Roche Biomedical Laboratories. When NorDx found that Devine’s urinalysis showed the presence of opiat

> Aron, a college student, signs a one-year lease agreement that runs from September 1 to August 31. The lease agreement specifies that the lease cannot be assigned without the landlord’s consent. In late May, Aron decides not to go to summer school and as

> Wilken owes Rivera $2,000. Howie promises Wilken that he will pay Rivera the $2,000 in return for Wilken’s promise to give Howie’s children guitar lessons. Is Rivera an intended beneficiary of the Howie-Wilken contract? Explain.

> On behalf of BRJM, LLC, Nicolas Kepple offered Howard Engelsen $210,000 for a parcel of land known as lot five on the north side of Barnes Road in Stonington, Connecticut. Engelsen’s company, Output Systems, Inc., owned the land. Engelsen had the lot sur

> Before their marriage, Linda and Gerald Heiden executed a prenuptial agreement. The agreement provided that “no spouse shall have any right in the property of the other spouse, even in the event of the death of either party.” The description of Gerald’s

> Joy Pervis and Brenda Pauley worked together as talent agents in Georgia. When Pervis “discovered” actress Dakota Fanning, Pervis sent Fanning’s audition tape to Cindy Osbrink, a talent agent in California. Osbrink agreed to represent Fanning in Californ

> After twenty-nine years of marriage, Robert and Mary Lou Tuttle were divorced. They admitted in court that before they were married, they had signed a prenuptial agreement. They agreed that the agreement had stated that each would keep his or her own pro

> Rimma Vaks and her husband, Steven Mangano, executed a written contract with Denise Ryan and Ryan Auction Co. to auction their furnishings. The six-page contract provided a detailed summary of the parties’ agreement. It addressed the items to be auctione

> Newmark & Co. Real Estate, Inc., contacted 2615 East 17 Street Realty, LLC, to lease certain real property on behalf of a client. Newmark e-mailed the landlord a separate agreement for the payment of Newmark’s commission. The landlord e-mailed it back wi

> Charter One Bank owned a fifteen-story commercial building. A fire inspector told Charter that the building’s drinking-water and fire-suppression systems were linked, which violated building codes. Without disclosing this information, Charter sold the bu

> Gemma promises a local hardware store that she will pay for a lawn mower that her brother is purchasing on credit if the brother fails to pay the debt. Must this promise be in writing to be enforceable? Why or why not?

> Jerome is an elderly man who lives with his nephew, Philip. Jerome is totally dependent on Philip’s support. Philip tells Jerome that unless Jerome transfers a tract of land he owns to Philip for a price 30 percent below market value, Philip will no long

> Claudia Aceves borrowed $845,000 from U.S. Bank to buy a home. Less than two years into the loan, she could no longer afford the monthly payments. The bank notified her that it planned to foreclose on her home. (Foreclosure is a process that allows a le

> Citynet, LLC, established an employee incentive plan “to enable the Company to attract and retain experienced individuals.” The plan provided that a participant who left Citynet’s employment was entitled to “cash out” his or her entire vested balance. (W

> D.V.G. (a minor) was injured in a one-car auto accident in Hoover, Alabama. The vehicle was covered by an insurance policy issued by Nationwide Mutual Insurance Co. Stan Brobston, D.V.G.’s attorney, accepted Nationwide’s offer of $50,000 on D.V.G.’s beha

> On Brenda Sniezek’s first day of work for the Kansas City Chiefs Football Club, she signed a document that purported to compel arbitration of any disputes that she might have with the Chiefs. In the document, Sniezek agreed to comply at all times with an

> PEMS Co. International, Inc., agreed to find a buyer for Rupp Industries, Inc., for a commission of 2 percent of the purchase price, which was to be paid by the buyer. Using PEMS’s services, an investment group bought Rupp for $20 million and changed its

> Dorothy Drury suffered from dementia and chronic confusion. When she became unable to manage her own affairs, including decisions about medical and financial matters, her son Eddie arranged for her to move to an assisted living facility. During admission

> Geographic Expeditions, Inc. (GeoEx), which guided climbs up Mount Kilimanjaro, required climbers to sign a release to participate in an expedition. The form required any disputes to be submitted to arbitration in San Francisco and limited damages to the

> J.T., a minor, is a motocross competitor. At Monster Mountain MX Park, he signed a waiver of liability to “hold harmless the park for any loss due to negligence.” Riding around the Monster Mountain track, J.T. rode over a blind jump, became airborne, and

> Kalen is a seventeen-year-old minor who has just graduated from high school. He is attending a university two hundred miles from home and has contracted to rent an apartment near the university for one year at $500 per month. He is working at a convenien

> Dewayne Hubbert, Elden Craft, Chris Grout, and Rhonda Byington bought computers from Dell Corp. through its Web site. Before buying, Hubbert and the others configured their own computers. To make a purchase, each buyer completed forms on five Web pages.

> Technical Consumer Products, Inc. (TCP) makes and distributes energy-efficient lighting products. Emily Bahr was TCP’s district sales manager in Minnesota, North Dakota, and South Dakota when the company announced the details of a bonus plan. A district

> In what circumstances will an offer be irrevocable?

> What is the difference between express and implied contracts?

> What are the four basic elements necessary to the formation of a valid contract?

> How can business leaders encourage their companies to act ethically?

> What types of ethical issues might arise in the context of international business transactions?

> What laws protect authors’ rights in the works they create?

> What defenses can be raised to avoid liability for criminal acts?

> Name four defenses that can be used against an ordinary holder but are not effective against an HDC.

> How does the negotiation of order instruments differ from the negotiation of bearer instruments?

> What are the respective obligations of the parties under a contract for the sale or lease of goods?

> How do duty-based ethical standards differ from outcome-based ethical standards?

> What federal law allows U.S. citizens, as well as citizens of foreign nations, to file civil actions in U.S. courts for torts that were committed overseas?

> What are some clauses commonly included in international business contracts

> What is the act of state doctrine? In what circumstances is this doctrine applied?

> When do courts grant specific performance as a remedy?

> When is a breach considered material, and what effect does that have on the other party’s obligation to perform?

> How are most contracts discharged?

> What are the elements of fraudulent misrepresentation?

> In what types of situations might voluntary consent to a contract’s terms be lacking?

> What are the elements that are necessary for an effective acceptance?

> What is intellectual property?

> Rye signs corporate checks for Suchin Corporation. Rye writes a check payable to U-All Company, even though Suchin does not owe U-All anything. Rye signs the check, forges U-All’s indorsement, and cashes the check at Viceroy Bank, the drawee. Does Suchin

> Brite Images, Inc. (BI), agrees to sell Catalog Corporation (CC) five thousand posters of celebrities, to be delivered on May 1. On April 1, BI repudiates the contract. CC informs BI that it expects delivery. Can CC sue BI without waiting until May 1? Wh

> Country Fruit Stand orders eighty cases of peaches from Down Home Farms. Without stating a reason, Down Home untimely delivers thirty cases instead of eighty. Does Country have the right to reject the shipment? Explain.

> Café Rojo, Ltd., an Ecuadoran firm, agrees to sell coffee beans to Dark Roast Coffee Company, a U.S. firm. Dark Roast accepts the beans but refuses to pay. Café Rojo sues Dark Roast in an Ecuadoran court and is awarded damages, but Dark Roast’s assets ar

> Eagle Company contracts to build a house for Frank. The contract states that “any assignment of this contract renders the contract void.” After Eagle builds the house, but before Frank pays, Eagle assigns its right to payment to Good Credit Company. Can

> In September, Sharyn agrees to work for Totem Productions, Inc., at $500 a week for a year beginning January 1. In October, Sharyn is offered $600 a week for the same work by Umber Shows, Ltd. When Sharyn tells her boss at Totem about the other offer, he

> Fidelity Corporation offers to hire Ron to replace Monica, who has given Fidelity a month’s notice of her intent to leave the company. Fidelity gives Ron a week to decide whether to accept. Two days later, Monica decides not to leave and signs an employm

> Dyna tells Ed that she will pay him $1,000 to set fire to her store so that she can collect under a fire insurance policy. Ed sets fire to the store, but Dyna refuses to pay. Can Ed recover? Why or why not?

> Daisy takes her roommate’s credit card, intending to charge expenses that she incurs on a vacation. Her first stop is a gas station, where she uses the card to pay for gas. With respect to the gas station, has she committed a crime? If so, what is it?

> Sony revealed that the script for a new James Bond movie had been hacked and leaked. Could a news publication legally print or post online that entire script? Why or why not?

> Suppose that Coca-Cola had been trying to make the public believe that its product contained cocaine. Would the result in the case likely have been different? Explain your answer.

> What is the essential difference between revoking acceptance and bringing a suit for breach of contract?

> When a contract becomes impossible or impracticable to perform, which remedy would a businessperson prefer— rescission or reformation? Why? Explain your answer.

> If a country does not have a Statute of Frauds and a dispute arises over an oral agreement, how can the parties substantiate their positions?

> Managers are potentially responsible for all actions of their foreign subsidiaries, whether or not they knew of the illegal conduct. Taking that fact into account, what actions should Orthofix’s upper management have taken before this corruption scandal

> What entities might pay “cyber mercenaries” to create some of the malware described in this feature?

> Why might it be difficult for U.S. authorities to ever investigate the KoobFace gang?

> What would be the cost to individuals and businesses that use checks if a similar law were passed in this country?

> What is a material breach of contract? When a material breach occurs, what are the nonbreaching party’s options?

> Suppose that after Lucy signed the agreement, he decided he did not want the farm after all, and that Zehmer sued Lucy to perform the contract. Would this change in the facts alter the court’s decision that Lucy and Zehmer had created an enforceable cont

> Suppose that Fitl and Strek had included in their deal a written clause requiring Fitl to give notice of any defect in the card within “7 days to 1 month” of its receipt. Would the result have been different? Why or why not?

> Why would the seller’s knowledge of the buyers’ limited resources support a finding of unconscionability?

> Professor Wise is teaching a summer seminar in business torts at State University. Several times during the course, he makes copies of relevant sections from business law texts and distributes them to his students. Wise does not realize that the daughter

> We should eliminate the status of holder in due course for those who possess negotiable instruments.

> If a contract specifies a particular carrier, then the shipper must use that carrier or be in breach of the contract—no exceptions should ever be allowed.

> The UCC should require the same degree of definiteness of terms, especially with respect to price and quantity, as general contract law does.

> The U.S. federal courts are accepting too many lawsuits initiated by foreigners that concern matters not relevant to this country.

> Courts should always uphold limitation-of-liability clauses, whether or not the two parties to the contract had equal bargaining power.

> The doctrine of commercial impracticability should be abolished.

> Many countries have eliminated the Statute of Frauds except for sales of real estate. The United States should do the same.

> After agreeing to an exculpatory clause or purchasing some item, minors often seek to avoid the contracts. Today’s minors are far from naïve and should not be allowed to avoid their contractual obligations.

> The terms and conditions in click-on agreements are so long and detailed that no one ever reads the agreements. Therefore, the act of clicking on “Yes, I agree” is not really an acceptance.

> Companies should be able to make or break employment contracts whenever and however they wish.

> Executives in large corporations are ultimately rewarded if their companies do well, particularly as evidenced by rising stock prices. Consequently, shouldn’t we just let those who run corporations decide what level of negative side effects is “acceptabl

> Because of overcriminalization, particularly by the federal government, Americans may be breaking the law regularly without knowing it. Should Congress rescind many of the more than four thousand federal crimes now on the books?

> Internet service providers should be subject to the same defamation laws as newspapers, magazines, and television and radio stations.

> Roslyn, a food buyer for Organic Cornucopia Food Company, decides to go into business for herself as Roslyn’s Kitchen. She contacts Organic’s suppliers, offering to buy their entire harvest for the next year. She also contacts Organic’s customers, offeri

> Robert Durbin, a student, borrowed funds from a bank for his education and signed a promissory note for their repayment. The bank loaned the funds under a federal program designed to assist students at postsecondary institutions. Under this program, repa

> GFI, Inc., a Hong Kong company, makes audio decoder chips, one of the essential components used in the manufacture of MP3 players. Egan Electronics contracts with GFI to buy 10,000 chips on an installment contract, with 2,500 chips to be shipped every th

> Guy Holcomb owns and operates Oasis Goodtime Emporium, an adult entertainment establishment. Holcomb wanted to create an adult Internet system for Oasis that would offer customers adult theme videos and live chat room programs using performers at the clu

> Robco, Inc., was a Florida arms dealer. The armed forces of Honduras contracted to purchase weapons from Robco over a six-year period. After the government was replaced and a democracy installed, the Honduran government sought to reduce the size of its m

> Kyle Bruno enters into a contract with X Entertainment to be a stuntman in a movie. Bruno is widely known as the best motorcycle stuntman in the business, and the movie, Xtreme Riders, has numerous scenes involving high-speed freestyle street-bike stunts

> Val’s Foods signs a contract to buy 1,500 pounds of basil from Sun Farms, a small organic herb grower, if an independent organization inspects the crop and certifies that it contains no pesticide or herbicide residue. Val’s has a contract with several re

> Chelene had been a caregiver for Marta’s elderly mother, Janis, for nine years. Shortly before Janis passed away, Chelene convinced her to buy Chelene’s house for Marta. Janis died before the papers were signed, however. Four months later, Marta used her

> Renee Beaver started racing go-karts competitively in 2015, when she was fourteen. Many of the races required her to sign an exculpatory clause to participate. She or her parents regularly signed such clauses. In 2017, right before her birthday, Renee pa