Business Law Assignment: Consideration and Contract Law Analysis

This business law assignment solution addresses key contract law principles. Part A analyzes the application of the Mirror Image Rule and the Battle of the Forms Rule in various scenarios involving offers, acceptances, and additional terms, including sales of goods and services. Part B delves into the element of consideration, evaluating whether sufficient legal value was exchanged to create binding agreements in different situations, such as promises to perform services, gratuitous promises, and debt adjustments. The assignment then applies concepts from chapters 13, 14, and 16 to fact situations, assessing issues like minors' contracts, capacity, and the enforceability of agreements. The solution examines each scenario to determine the presence of valid consideration and the impact of additional terms on contract formation, offering detailed explanations based on relevant legal principles and case law.

Running head: BUSINESS LAW ASSIGNMENT 1
Business Law Assignment
Name
Institution

BUSINESS LAW ASSIGNMENT 2
Business Law Assignment
Part A (Chapter 11): Apply the Mirror Image Rule or the Battle of the Forms Rule,
whichever is appropriate, to answer the following questions.
Q.I. Brian has purchased a new Toyota Camry and offers to sell his used 1998 Honda Civic to
his neighbour, Amanda. Brian's written offer states, "I, Brian, will sell Amanda my 1998 Honda
Civic for $2500, $1000 as a down payment and the remaining balance financed at 10% interest,
with monthly payments of $300."
Amanda responds with a following written acceptance, " I will purchase Brian's 1998 Honda
Civic for $2500, $1000 down payment, the remaining balance financed at 10% interest, with
monthly payments of $300. Brian agrees to have the oil changed and the car detailed before
delivery."
1. What rule will be applied to determine if the acceptance with additional terms is
effective?
The U.C.C. Battle of the Forms would be used.
2. Why would that rule apply?
This rule would be used because additional terms were included in the
acceptance in regards to the sale of a kind (August et al. 2012). Because Amanda
added other terms does not necessarily make the offer ineffective because the
U.C.C. tries to promote and facilitate commercial transactions through this since

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most business transactions involve fine print and other conditions (CHARLES,
D. 2013).
3. Was acceptance effective and as such, created a contract between the parties?
If there is a definite expression of acceptance, then the approval will be
valid despite the additional terms (Clark, R. C. 2016).
4. How will the additional term be treated?
The additional terms would be treated as an agreement between non-
merchants. Therefore, the other terms included in the acceptance do not become
part of the contract. The conditions will be treated as proposals for addition to
the agreement and can, therefore, be rejected or accepted by the offeror. This
can be an implied or expressive acceptance.
Q.I.I. Kate, a licensed the masseuse, sends the following written offer to Josh, a former client,
"Kate will sell Josh a massage package with ten 90 minute deep tissue massages for $500. All
messages must be scheduled at least one week in advance. Payment is due upon receipt of
service and must be made in cash or by credit card".
Josh responds to Kate's offer with the following written acceptance, "Josh agrees to purchase
Kate's massage package with ten 90 minute deep tissue massages for $500. All messages must be
scheduled at least one week in advance. Payment is due upon receipt of service must be made in
cash or by credit card. Josh may cancel and reschedule any scheduled massage appointment with
24-hour notice."

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1. What rule will be applied to determine if the acceptance with additional terms is
effective?
The Mirror Image Rule would be used.
2. Why would that rule apply?
This rule would be implemented because it involves additional conditions
added to a contract in regards to personal services or property.
3. Was acceptance effective and as such, created a contract between the parties?
The approval by the offeree had to be the mirror image of the offer to be
effective. If there were additional terms included in the recognition, it would not
be an effective acceptance because it did not match the original proposal (Locker,
K. O., & Kienzler, D. S. 2010).
4. How will the additional term be treated?
The other conditions would be treated as a counteroffer which the offeror
could either accept or reject by expression or implication.
QIII. Greentree Plant Nursery sends Leafy Landscaping the following notice " All one-gallon
ornamental bushes can be purchased at $13.00 a unit. Greentree will deliver the bushes to the
buyer's place of business. Payment to be made by cash or credit card."
Leafy Landscaping then sends the following preprinted purchase order for 80 one gallon
ornamental bushes. The purchase order includes the term "Greentree agrees to provide a 10%
discount on all ornamental bushes not delivered to the buyer within 30 days of the date of this
purchase order."

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1. What rule will be applied to determine if the purchase order with additional terms
is effective?
The U.C.C. Battle of the Forms rule would be used.
2. Why would that rule apply?
This rule would be involved because additional terms were included in
the acceptance in regards to the sale of a good. Because Leafy Landscaping
added other terms does not necessarily make the offer ineffective because the
U.C.C. tries to promote and facilitate commercial transactions through this since
most business transactions involve fine print and additional conditions (Pierce,
R. J., & Davis, K. C. 2012).
3. Was the acceptance effective and as such, created a contract between the
parties?
The additional terms under this rule would be practical and treated as
part of the agreement between the parties because both parties are
merchants.
4. If so, does the additional term become part of the contract?
Yes
5. Assuming it does, is there any way Acme could prevent the other term from
becoming part of the deal?
Acme prevent the additional term from becoming part of the agreement
by claiming: 1) The offer expressly limits acceptance to the terms of the offer, 2)

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The other conditions materially alter the offer or 3) Acme can reject the other
words within ten days after receiving it.
Part B (Chapter 12): The attached questions deal with the element of consideration. Did each
party exchange something of sufficient legal value to meet the element of concern and thus
create a contract? Do not examine other aspects of the agreements, just the component of
interest.
1. Patty offers to bake Mark a pumpkin pie if he promises to paint her house, wash her car and
build a fence around her back yard. Mark accepts Patty's offer. After washing Patty's car, Mark
decides that Patty has taken advantage of him and tells her that he will not paint her house or
build the fence. Patty performs as she promised and sues for breach of contract. Did both parties
provide adequate consideration to create a binding agreement? Explain why or why not.
Both parties provided adequate consideration to create a binding contract. Matt
accepted Patty's offer and promised to perform a task in exchange for a good. In a bilateral
agreement, a promise to deliver is sufficient enough to establish the element of
consideration (Metzger et al. 2019). He cannot back out on his pledge simply because the
amount of work he did had more value than a pumpkin pie. Monetary worth is not
something that will be examined by a court.
2. Jerry is a part-time college student. On Wednesday he notices that his neighbour, Mrs Smith,
has had a load of wood delivered. Jerry has a lot of time on his hands a decides he would enjoy

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splitting and stacking Mrs Smith's wood. He tells Mrs Smith that on Saturday he will cut and
stack her wood. Mrs Smith is very excited, and thanks to Jerry several times. On Saturday Jerry
gets up late and decides he would rather spend the day on the couch watching football. Mrs
Smith has to pay someone else to split and stack the wood. Mrs Smith sues Jerry for breach of
contract. Did both parties provide adequate consideration to create a binding agreement?
Explain why or why not.
Both parties did not provide adequate consideration and therefore, did not create a
binding contract. Jerry offered to cut Mrs Smith's wood without asking for or receiving
anything in return. This is considered a gratuitous promise and these types of obligations
do not form contracts. This agreement held no legal value (what is exchanged to create a
binding contract).
3. Mandy has inherited a large amount of money and decides she would like to do something
beautiful for her friend Devon. Devon has been dating a real loser named Wally. Mandy tells
Devon that she will give Devon $5000 if Devon promises not to date Wally anymore. Devon
broke up with Wally earlier in the week, so she accepts Mandy's offer. Later Mandy and Devon
have a falling out, and Mandy refuses to give her the $5000. Devon sues Mandy for breach of
contract. Did both parties provide adequate consideration to create a binding agreement?
Explain why or why not.
I do think Mandy and Devon have provided adequate consideration to create a
binding contract. Mandy agreed to pay Devon 5000 dollars if she stopped seeing Wally.
Since Devon continued not to date Wally Many is obligated to pay her $5000. However, I
think it is unhonest of Devon to agree to this contract when, unbeknownst to Mandy, she

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had already broken up with Wally before. I could not find anything throughout the text
supporting that this should be grounded not to provide adequate consideration, but I think
there should be something.
4. Cindy is running for mayor of La Grande. She recently broke with her boyfriend, Steve.
Cindy is aware that Steve is very hurt and quite vindictive. Cindy is concerned that Steve may
be making defamatory statements about her. She thinks that such rumours might jeopardize her
chance of being elected. Cindy offers to give Steve $500 if he promises not to spread any untrue,
defamatory statements about her until after the election. Steve accepts her offer. After Cindy is
elected, he tries to collect the $500, but Cindy refuses to pay. Steve sues for breach of contract.
Did both parties provide adequate consideration to create a binding agreement? Explain why or
why not.
Both parties did not provide adequate consideration to create a binding contract.
Because defamation is illegal, Cindy is not obligated to pay Steve $500 for not making
defamatory statements about her. The preexisting legal duty exception explains this. A
promise to do something (or in this case refraining from doing something) that one is
already legally obligated to do is not sufficient to create the element of consideration
(Palmer et al. 2018).
5. Hernando is a famous sculptor who, in his later years, has developed arthritis. He still
sculpts but only when his hands aren't hurting. Mrs Howell has wanted Hernando to create a bust
of her husband for years, but he has always been too busy. Hernando finally has the time, and
Mrs Howell has Hernando sign the following agreement "Hernando agrees to create a bust of my
husband if he feels he can without too much discomfort, and in return, I agree to pay him

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$4000." Did both parties provide adequate consideration to create a binding contract? Explain
why or why not.
Both parties did not provide adequate consideration because by agreeing to this
contract, Fernando is making a false promise. Hernando is not bound to the pledge because
he may never be able to complete the task without discomfort (Petty, R. D. 2012).
6. Will sues Joe and is awarded a $40,000 judgement. Joe claims that he cannot pay the
$40,000 and offers instead to give Will $15,000 and to paint his house. Will agrees and accepts
the $15,000 and has Joe paint his house. Later Will asserts that Joe still owes him $25,000. Did
both parties provide adequate consideration to create a binding debt adjustment agreement?
Explain why or why not.
When a debtor promises to pay less than he owes his promise is not sufficient
consideration. An agreement to accept a partial payment for a liquidated debt does not
create a contract.
Apply the concepts presented in chapters 13, 14 and 16 to the following fact situations.
I. Donna is seventeen years old and has a large unattractive mole on her cheek which she
believes is the source of her low self-esteem. She consults Dr. Slycoff, who recommends that
she have the mole removed and says that he will do the operation for $9000. Donna says she has
no insurance and will not pay more than $5000 for the operation. Dr. Slycoff believes that the
new state health plan will reimbursed him for the difference between his normal fee and the
amount Donna will pay, so he orally agrees to perform the operation for $5000. Later, after the
operation and Donna’s birthday, Donna has yet to pay and informs Dr. Slycoff that she won't

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fulfill her contractual obligations. Also the state health plan did not pay anything towards the
operation. Dr. Slycoff sues Donna for $9000.
1. Does the statute of frauds require that the contract be written to be enforceable?
Explain your answer.
The statue of frauds does require the contract to be written because it was a sale of
good over $500.
2. What type of contract have Donna and the doctor created; valid, voidable,
unenforceable, or void.?
The contract is voidable contract because it meets all elements of enforceable
contract with only one flaw, which is that Donna was a minor at that time of the agreement
of the contract.
3. Can Donna disaffirm her contractual obligations? Explain your answer.
Yes, Donna was under 18 when the contract was agreed upon and as a minor has
limited legal capacity to agree on the contract. Even though the contract was performed
after her 18th birthday, the actual agreement of the contract was when she was a minor.
4. If before performing the operation, Dr. Slycoff discovered that he would not be
reimbursed by the state health plan, could he assert the defense of mistake and have the contract
rescinded. Explain your answer.
Yes, he would be able to assert the defense of mistake claiming a unilateral mistake.

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II. Addie owns a 1969 VW van which is custom painted in a variety of colors with numerous
flowers and a large peace sign on the front of it. While sitting in a tavern she enters into
negotiations with Bob for the sale of the van. After a few beers and much
negotiating, they agree on the following terms which are written down on a napkin, "Addie
agrees to sell Bob his 1969 VW van for $3500. Title is to be transferred immediately and
payment to be made over the next 90 days". Bob signs but Addie hesitates because she is
concerned about Bill's ability to pay. At this point Bob's friend, Tom, tells Addie that if Bob
does not pay in full, he will. With this assurance Addie and Bob signs the napkin. 30 days later
the transmission on the van goes out. Bob refuses to pay Addie because he says that while
negotiating the sale of the van Addie agreed to warranty the van for 60 days after the sale.
5. Examine the validity of this contract. Is there any way that Addie can challenge the validity of
the contract? Explain your answer
Addie can challenge the validity of the contract because they were all drinking and not all
parties were at full capacity to make a contract.
6. Assuming the contract is valid, is Tom liable under the contract? Explain your answer.
Yes, in the contract Ted agreed to pay if Bill defaulted there was no agreement of
nonpayment because of the vans issues
7. Will the warranty agreement be included in the contract? Explain your answer.
No, a warranty was not discussed in the original agreement and was never
mentioned.
III. Lila has been dating Bud for three weeks. She has never met anyone like Bud and as each
day passes she feels closer to him. Lila is certain that Bud will eventually ask her to marry him
and that they will live happily ever after. Bud has been trying to obtain a loan
to start a business but has very little income and no assets. Bud explains to Lia that if he had title
to the new Jeep Grand Cherokee that her parents just gave her, he could use it as collateral to
obtain his loan. Bud proposes that Lila sell him the Jeep for $1000. Anxious to accept any

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proposal from Bud, Lila agrees. After title is transferred, Bud does not use the Jeep as collateral
but instead uses it to impress Buffy. Bud and Buffy quickly become an item, and each changes
their Facebook status to “in a relationship”. Sadly, Lia then spends Valentines Day alone, eating
Cheetos while watching reruns of The Bachelorette on Hulu.
7.Identify the two defenses that Lila might assert to invalidate the contract and apply the
elements of each to the facts presented.
Lila can assert the Misrepresentation
There is a misrepresentation, an untrue assertion of fact,
The misrepresentation is either fraudulent or material
The misrepresentation induced the other part to enter into the contract, The party's
reliance on the misrepresentation was reasonable.
I. Raymond and Sue have been dating for three years, and it is expected that they will
marry soon. Raymond has leased a two bedroom house from Sue’s parents, and they have hinted
that they will give the house to Sue and Raymond when they marry. Raymond spends many
weekends fixing the house up and in July builds a large deck off the back of the house.
Unfortunately that month Sue meets and falls in love with Derek. In September Raymond’s
lease runs out and Sue’s parents tell him he will have to move because Derek wants to rent the
place. Raymond informs Sue’s parents that they owe him $1500 for the time and materials he
spent building the deck. He tells them that if they don’t pay he will tear up the deck and take his
lumber with him.
1. Is the deck Raymond’s personal property which he can take with him or is it part of
the real property that belongs to Sue’s parents? Explain your answer.
Even though Raymond paid for the materials to build the deck, with it being
attached to the house it is treated at real property and therefore it belongs to Sue’s parents.
II. Dr. Harrington of La Grande, Oregon recently passed away after a long and rich life.
Among the assets in his estate is a two-acre piece of property with a small cottage on it known as