Essay Problems - Amy and the Convertible

Contracts

Essay Problems - Amy and The Convertible

There are lots of issues. They are: Jurisdiction, Formation (Bargain Theory – Offer, Acceptance + Consideration), Detrimental Reliance, Quasi-Contract, Anticipatory Repudiation, Damages in Expectation, Damages in Reliance and Damages in Restitution.

The first issue is jurisdiction. Where the subject matter is for services and not for the sale of goods, the deal between the parties must be analyzed under the common law. The common law governs formation, performance and damages. In this case, Amy asks Ben to wash her car, thus satisfying the element of service because the act of washing a car is not a sale of goods (movable, personal property). Given these observations, bearing in mind the rule that applies, it follows that the deal between the parties should be governed by the common law.

The next issue is formation. The formation of a contract presupposes mutual assent, an offer and acceptance supported by consideration. We can look at the outward manifestations of the parties to establish a deal between them. Section 17 and 19 of Restatement Second of Contracts tells to look at the words, conduct and writings by the parties to establish a deal. An offer, in this case, is a manifestation of willingness to enter into a bargain so made as to justify another in believing that his assent (acceptance) to that bargain is invited and will conclude it. An offer must contain (1) a promise, (2) a request by the offeror and (3) instructions from the offeror in how to respond to the offer. Accordingly, an acceptance must contain an (1) acknowledgment of the offer, (2) a signal to cooperate and (3) rendition of what is requested by the offeror. One who accepts must commit every essential act to the making of an offer. In order to constitute consideration, an acceptance, as either a return promise or return performance, must be bargained for. A promise or performance is considered bargained for when it is sought by the promisor in exchange for his promise and given by the promise in exchange for that promise.

In this case, when Amy sees Ben and says “I will pay you $600 if you will wash and wax [my car] every Friday for the summer” this constitutes an offer because the terms indicate a promise ($600), request (washing her car every Friday for the summer) and being that she provides no instructions in how to respond, she leaves it up to Ben either promise to perform or perform. With regard to Ben, he accepts Amy’s offer because his reply of “Sure” acknowledges her offer, he states that he will cancel mowing another’s law on Friday’s, thus satisfying the element of signal to cooperate and being that Amy didn’t give him a set of instructions, he promises to perform the service. With regard to consideration, the exchange of promises between the parties constitute consideration because both engage in bargain for one another’s promise.

The next issue is detrimental reliance, also known as promissory estoppel. Under the common law, a promise by the promisor he should reasonably expect to induce action or forbearance on the part of the promisee and which does induce action or forbearance on the promisee is binding if justice can be avoided by enforcing the promise. In this case, when Amy tells Ben that she will pay him $600 if he washes her car on Friday’s for the summer, she should reasonably expect action or forbearance because a reasonable person would take her on her offer because her conduct after he agrees to wash her car doesn’t suggest otherwise. Here, it does induce action on Ben part because he tells Amy he will cancel his preexisting arrangement and gives her $50 to buy his supplies.