Contracts Case

Case Scenario: Big Time Toy Maker

By

LAW 421

March 3, 2013

At what point, if ever, did the parties have a contract?

Contracts are "agreements between two entities, creating an enforceable obligation to do or to refrain from doing, a particular thing". (Farlex. 2014. Para 1). There are many different types of contracts. In the case scenario described in the text, the oral agreement was used between the Big Time Toymaker and Chou. In the described scenario Chou is the inventor of a new product, a strategy game called star. In the scenario The Time Toymaker paid Chou 25,000 dollars, in exchange for the 90 day period exclusive negotiation rights. If meeting certain requirements, oral and written agreements both, are considered to be binding contracts. Both parties involved in the case scenario had a contract between them. The mutual asset was established between both of the parties, the offer of agreement, and the acceptance of that agreement occurred. The offer was specifically for negotiation rights, and did not include the distribution rights. The oral agreement specified that unless written, no contract regarding distribution existed. In this case the statue of frauds law did not apply doe to the fact that the agreement was mainly based on provided services. UCC clearly states that the Statue of Frauds law only applies to contracts regarding the sales of goods for 500 dollars or more.

What facts may weigh in favor of or against Chou in terms of the parties' objective intent to contract?

According to the scenario Chou is faced with both favorable and unfavorable facts. In the scenario, after the mutual agreement was reached regarding the exclusive negotiating rights, three days before the end of the 90 day period, the oral agreement was reached as well regarding the distribution contract. The issue concerning this matter is that the deal is mainly based on the sale of goods, and is going to exceed the 500 dollar minimum. The statue of frauds law states that these types of contracts must be in writing to be valid in the eyes of the law. A BTT manager chose to send Chou an email, and utilize the email as a form of a written contract, by stating the terms of the contract previously agreed upon by both parties. The email did not specify that it was a contract, and neither party's signatures were present. The emails purpose was to state the terms that both parties agreed upon, so after a month when BTT sent a fax to Chou regarding the request for the distribution agreement draft, it was an opportunity to make it clear that the previous email was not a valid contract, and specified that the e mail was a curacy email to state the terms agreed in the contract.

Does the fact that the parties were communicating by e-mail have any impact on your

Analysis?

After reviewing the facts, I do not feel that email communication between the both parties had impact on my analysis. One of the reasons why includes the fact that there is no proof that Chou ever replied and stated that he agreed to the original email, sent by the manager from BTT. When there is no proof that the both parties agreed to the terms of any agreements, the agreement or contract is not valid in the eyes of the law. There was no documented proof to show that Chou ever initiated any offer to BTT.

What role does the statute of frauds play in this contract?

Doe to the fact that the agreement doesn't include goods, the statue of frauds does not play any role in this. In this scenario the negotiation agreement, which basis on