1 A sole proprietorship is a business owned by one or more people

False

2 Unlimited liability is an advantage of a sole proprietorship

False

3 A partnership is simply a business owned by two or more people who have not filed papers to become a co oration.

True

4 A corporation is treated as a person, separate and distinct from its owners.

True

1.A Sole Proprietorship is a one-person business that is perhaps the easiest and simplest business enterprise to organize

True

2.A limited liability company (LLC) is taxed like a partnership but provides limited liability for its owners, similar to a co
oration.

True

3.A limited liability company (LLC) is formed when a general partnership files a statement of

qualification with the appropriate public official.

True

4.The CEO has to pay the debt for limited liability company

False

I. Indicate whether each of the following statements is TRUE or FALSE, and EXPLAIN

why?

1 An agreement cannot occur unless there is an offer and acceptance of that offer  TRUE

Explain: -Offer: An offer is a proposal made by one party (the offeror) to another (the offeree), expressing a willingness to enter
into a contract on certain terms. The offer must be communicated clearly and must indicate an intention to be bound by the terms
of the offer if accepted. Without a valid offer, there is nothing for the other party to accept, thus making an agreement impossible

-Acceptance: Acceptance is the unequivocal expression of agreement to the terms of the offer. It must be communicated to the
offeror in the manner specified or implied by the offer. Acceptance creates a legally binding agreement between the parties.
Without acceptance, there is no mutual assent to the terms of the offer, and thus no agreement can be formed.

Once an agreement is reached, if the other elements of a contract are present a valid contract is formed. Agreement only
appears when we have offer and acceptance.

2 An invitation to treat is an invitation to buy a bargain False

-An invitation to treat means to an invitation for offers or negotiations. It is not an offer itself but an indication that one party is
willing to negotiate or receive offers. Advertisements, Catalogues, Price Lists and Circular are treated as invitation to negotiate
and not as offers.

-While an invitation to buy a bargain shows a specific offer made to purchase something at a favorable or discounted price.
Unlike an invitation to treat, an invitation to buy a bargain is closer to an actual offer, as it typically indicates a willingness to
enter into a contract on specific terms.

An invitation to treat is not an offer but an invitation for negotiation or offers, whereas an invitation to buy a bargain implies a
specific offer for a favorable purchase. The two terms serve different functions in the formation of contracts.

3 Goods on display in a supermarket are being offered for sale  FALSE

-Because when goods are displayed in a supermarket, the store is inviting customers to make an offer to purchase those goods, or
other words, it is an invitation to treat. From this, the store wants to indicate with customers that items in the supermarket can be
purchased, customers can choose the goods they like and take them to the checkout counter to make an offer to buy goods.

-The key distinction here is that the display of goods is typically considered an invitation to treat rather than a binding offer. It
indicates that the store is willing to enter into negotiations with customers but does not necessarily mean that a contract of sale
has been formed until the customer makes an offer and it is accepted by the store (usually at the point of sale).

4 An acceptance is not valid unless the offeree knows about the offer and has it in mind  TRUE

According to the objective theory of contracts, intention to enter into a legally binding agreement, or contract, is judged by
outward, objective facts as interpreted by a reasonable person, rather than by the party’s own secret, subjective intentions.

Offeree ko biết về offer thì ko thể chấp nhận đc

5 An offer is rejected if the offeree tries to vary the conditions of the offer  TRUE

Because when offeree try to vary the conditions of the offer means that they reject the original offer and making of a new offer, or
other words, it is considered a counteroffer rather than an acceptance. When an offer is made, offeror is willing to enter into a
contract and offeree has the right choose should accept or not that offer, or propose changes to the terms. But in this case offeree
is trying to vary the conditions of the offer, this is the same with making a new offer An original offer is rejected

6 When instantaneous communication is used, a contract is made as soon as the offer is sent  False

Instantaneous communication can expedite the process of contract formation, but a contract is not made as soon as the offer is
sent. Contract formation requires both offer and acceptance, as well as mutual understanding and communication of terms
between the parties involved.

Contract formation typically requires both an offer and acceptance. While instantaneous communication can expedite the
process, the mere sending of an offer does not instantly create a contract. Several factors come into play:

Offer: The offeror (the party making the offer) must clearly communicate their intention to enter into a contract, including all
essential terms of the agreement. In instantaneous communication, the offer is sent promptly, but it does not conclude the
contract; rather, it initiates the process.

Acceptance: The offeree (the party to whom the offer is made) must unequivocally accept the offer as presented. In the context of
instantaneous communication, the offeree may promptly respond, but the acceptance must be received by the offeror to be valid.

Meeting of Minds: For a contract to be formed, there must be a mutual understanding and agreement on the terms. Both parties
must be aware of and consent to the terms of the contract. Instantaneous communication facilitates rapid exchange, but it does
not guarantee instant agreement or understanding.

Communication: Both the offer and acceptance must be communicated effectively. Mere sending of an offer does not guarantee
that it has been received and understood by the offeree. Likewise, the acceptance must be communicated back to the offeror.

In conclusion, while instantaneous communication can expedite the process of contract formation, a contract is not made as soon
as the offer is sent. Contract formation requires both offer and acceptance, as well as mutual understanding and communication
of terms between the parties involved

7 When parties communicate by fax, acceptance cannot occur until the offeror has read the acceptance  False
- Acceptance becomes effective on dispatch, providing that authorized means of communication is used. Offeree accepts by using
the stipulated means of acceptance. An acceptance can’t occur only when acceptance is not properly dispatched by the Offeree;
Offeror specifies that acceptance will not be effective until it is received; and acceptance is sent after rejection, whichever is
received first is given effect.

Áp dụng reception rule, offer có xảy ra ( có hiệu lực) khi receive by offeror

8 An offeree who intends to accept an offer can accept through silence False

-Silence does not typically constitute acceptance. For a contract to be formed, there must be clear and unequivocal acceptance of
the offer by the offeree.

In contract law, silence does not typically constitute acceptance. For a contract to be formed, there must be clear and
unequivocal acceptance of the offer by the offeree. Silence alone is generally not considered sufficient to demonstrate acceptance
for several reasons:

Requirement of Communication: Contract law generally requires that acceptance be communicated to the offeror. Silence does
not meet this requirement because it does not communicate the offeree's intention to accept the offer. Without clear
communication of acceptance, there is no meeting of the minds, which is essential for the formation of a contract.

Presumption Against Silence: In many legal systems, including common law jurisdictions, there is a presumption against
interpreting silence as acceptance. This presumption is based on the principle that parties should not be bound to contracts
without actively agreeing to the terms.

Exceptional Circumstances: There are some exceptional circumstances where silence may be construed as acceptance, but these
are typically limited and require specific conditions to be met. For example, if the offeree has previously established a pattern of
conduct where silence is understood as acceptance, or if the offeror explicitly states that silence will be considered acceptance
and the offeree continues to receive benefits under such circumstances.

In summary, while there may be rare exceptions, in general, silence alone does not constitute acceptance of an offer in contract
law. Acceptance typically requires clear and affirmative communication of assent to the terms of the offer.

9 A revocation is not valid unless it is received by the offeree  TRUE

10 Under the postal rule an offer is accepted when an acceptance is posted  FALSE

-Under the postal rule, acceptance is typically deemed effective upon posting. This rule applies when the parties have expressly
or impliedly indicated that acceptance by post is acceptable. Once the acceptance is posted, it is considered valid even if the
offeror is not aware of it immediately.

The postal rule, also known as the mailbox rule, is a principle in contract law that governs the timing of acceptance when parties
communicate by mail (or similar means of communication where physical distance is involved). According to this rule, an
acceptance is generally considered effective as soon as it is posted, rather than when it is received by the offeror.

Here's why:

Acceptance Upon Posting: The postal rule states that acceptance is effective as soon as the offeree (the party accepting the offer)
posts or dispatches the acceptance. This means that the acceptance takes effect at the moment it is placed into the control of the
postal service or similar delivery method.

Certainty and Convenience: The postal rule provides certainty and convenience to parties engaging in long-distance
transactions. It prevents delays or uncertainties caused by the time it takes for an acceptance to reach the offeror, especially in
cases where there may be significant physical distance between the parties.

Risk Allocation: The postal rule allocates the risk of delay or loss during transmission to the offeror. Once the offeree has posted
their acceptance in accordance with the terms of the offer, they have done everything required to form a contract, and the offeror
is bound by the acceptance, even if it is lost or delayed in transit.

In summary, under the postal rule, an offer is generally accepted when the acceptance is posted by the offeree, providing an
efficient and fair method for determining the timing of contract formation in situations involving mail or similar forms of
communication

11 A revocation by post is valid as soon as the letter is posted  TRUE

A revocation by post is generally valid as soon as the letter containing the revocation is posted. This principle operates similarly
to the postal rule for acceptance. Once the offeror posts the revocation letter, it is considered effective, even if the offeree has not
yet received it.

Revocation có hiệu lực khi offeror gửi đi chứ không phải khi offeree nhận đc

12 An offer will lapse if it is not accepted within a specified or reasonable period of time  TRUE

-An offer may lapse if it is not accepted within a specified period mentioned in the offer or within a reasonable period of time if
no specific timeframe is stated. This principle ensures that offers do not remain open indefinitely and allows parties to move
forward if the offer is not accepted within a reasonable timeframe.

Requirement of Acceptance: For a contract to be formed, there must be an offer by one party and acceptance of that offer by the
other party. Acceptance typically needs to occur within a reasonable timeframe to ensure that the parties are still willing to be
bound by the terms of the offer.

Implied Timeframe: Some offers explicitly state a timeframe within which they must be accepted. In such cases, if the offeree does
not accept the offer within the specified period, the offer is considered to have lapsed or expired.

Reasonable Timeframe: Even if an offer does not specify a timeframe for acceptance, it is implied that the offer should be
accepted within a reasonable period of time. What constitutes a reasonable period varies depending on the circumstances,
including the nature of the offer, the subject matter, and industry standards.

Preventing Uncertainty: Allowing offers to remain open indefinitely could lead to uncertainty and confusion for both parties.
Setting a timeframe for acceptance ensures that the offeror knows whether their offer has been accepted or rejected within a
reasonable timeframe.

In summary, an offer typically lapses or expires if it is not accepted within a specified or reasonable period of time. This
principle helps provide clarity and certainty in contract negotiations and prevents offers from remaining open indefinitely.

13 An offer will lapse if the conditions of the offer are not satisfied  TRUE

-An offer can lapse if the conditions of the offer are not satisfied within the specified timeframe or reasonable period. If the
conditions outlined in the offer are not met, the offer becomes invalid, and the offeree cannot accept it. This ensures that offers
are only binding when all conditions are met as specified by the offeror

Conditionality of Offers: Sometimes, offers are made subject to certain conditions. These conditions could be anything mutually
agreed upon by the parties, such as the completion of a background check, obtaining financing, or securing necessary regulatory
approvals.

Requirement for Contract Formation: For an offer to be accepted and a contract to be formed, the offeree must accept the offer
in accordance with its terms, including any specified conditions. If the conditions are not met or satisfied, the offer cannot be
accepted, and therefore, the offer lapses or becomes invalid.

Effect on Offer Validity: If the conditions of the offer are not met within the specified timeframe (if any) or within a reasonable
period, the offeror is generally no longer bound by the offer. This ensures that offers are not left open indefinitely and provides
certainty to both parties regarding the status of the offer.

Preventing Uncertainty: Allowing offers to remain open when conditions are not satisfied could lead to uncertainty and potential
disputes between the parties. Lapsing the offer when conditions are not met helps prevent such uncertainty and promotes clarity
in contractual relationships.In summary, an offer will typically lapse if the conditions of the offer are not satisfied within the
specified timeframe or within a reasonable period. This ensures that offers are only binding when all conditions are met as
specified by the offeror.

II. Typical cases in law reports of contract- Find out rules from the following case:

a) Byrne& Co v Van Tienhoven& Co (1880) 5 All ER 344

1st October Cardiff firm offered by letter to sell 1000 boxes of tinplates to New York firm
8th October Cardiff firm posted letter revoking their offer

10th October New York firm received the letter of offer

11th October New York firm telegraphed acceptance of the offer

15th October New York firm posted a letter confirming its telegraphed acceptance

20th October New York firm received letter of revocation from Cardiff firm

Did the acceptance occur?

Answer:

Mail box rule may apply. Contract effective from 15th. In this case, mail box rule applies. Because: Cardiff in UK, new
york in USA …..

Mail box rule only sends by post

→Contract here

acceptance occurs, on the 15th

• An offer can be revoked before acceptance is communicated, but the revocation must be received by the offeree before
they accept.

•The revocation posted on 8th October and received on 20th October was ineffective because the New York firm had
already accepted the offer on 11th October via telegraph.

Có thể áp dụng mail box rule. Hợp đồng có hiệu lực từ ngày 15. Trong trường hợp này áp dụng mail box rule. Vì: Cardiff
ở UK, new york ở mĩ …..

Mail box rule chỉ gửi qua đường bưu điện

→Có contract ở đây

b) Entores Ltd v Miles Far East Corp (1959) 2 QB 327

A London firm used a telex machine (an early version of a fax machine) to communicate its offer to buy goods from a company
in Amsterdam. The Amsterdam company accepted by telex. Subsequently, when the parties fell into dispute, they disagreed as to
where and when the contract had been made and which law should apply. Your answers

Answer:

The contract shall be made in England and subject to English law. The contract shall be effective when received in
London, upon receipt English law shall apply as the contract is effective in England.

London in England

Amterdam in the Netherlands - under Civil law

Hợp đồng sẽ đc thực hiện ở Anh và tuân theo luật Anh. Hợp đồng có hiệu lực khi nhận đc ở London, khi nhận đc thì áp
dụng luật của Anh vì hợp đồng có hiệu lực ở Anh.

London ở Anh

Ámterdam ở Hà Lan- theo Civil law

c) Hyde v Wrench (1840) 3 Beav 334

1 June Wrench offered to sell estate to Hyde for £1200
2 June Hyde rejected the offer

6 June Wrench offered to sell for £1000

8 June Hyde replied, offering £ 950

27 June Wrench rejected

28th June Hyde attempted to accept the £1000 offer . Was Wrench bound to sell at £1000

Answer:

-Revocation of Offer: An offer can be revoked at any time before it is accepted, provided that the revocation is communicated to
the offeree. In this case, Wrench's initial offer of £1200 to Hyde was revoked when Hyde rejected it on June 2nd.

-Rejection by Offeree: A counteroffer by offeree is a rejection of the original offer and making of a new offer. In this case, Hyde
(offeree) making a new offer in 8 June (£950) which exchange original offer (£1000) of Wrench (offeror).

-Revocation of the offer by the offeror: an offer effective when the offeree of offeree’s agent receives it. In this case, Wrench
rejected a new offer (£950 of Hyde in 8 June) on 27 June

-Attempted Acceptance: When Hyde attempted to accept Wrench's original offer of £1000 on June 28th, it was ineffective
because the offer had already been terminated by Hyde's rejection and subsequent counter-offer of £950

In Hyde v Wrench (1840) 3 Beav 334, several important rules regarding offers, counter-offers, and acceptance in contract law
are established:

Revocation of Offer: An offer can be revoked at any time before it is accepted, provided that the revocation is communicated to
the offeree. In this case, Wrench's initial offer of £1200 to Hyde was revoked when Hyde rejected it on June 2nd.

Counter-offer: A counter-offer is a response to an offer that introduces new terms or modifies the terms of the original offer. A
counter-offer operates as a rejection of the original offer and constitutes a new offer. When Hyde replied on June 8th, offering
£950 in response to Wrench's offer of £1000 on June 6th, Hyde made a counter-offer.

Rejection of Counter-offer: When an offeror receives a counter-offer from the offeree, the original offer is terminated, and the
offeror is no longer bound by its terms. In this case, Wrench rejected Hyde's counter-offer of £950 on June 27th.

Attempted Acceptance: When Hyde attempted to accept Wrench's original offer of £1000 on June 28th, it was ineffective because
the offer had already been terminated by Hyde's rejection and subsequent counter-offer of £950

Based on these rules, Wrench was not bound to sell at £1000, and Hyde's attempted acceptance of the £1000 offer did not occur
because the offer had been terminated by Hyde's counter-offer. Therefore, Wrench was not obligated to sell at £1000, and there
was no valid acceptance of that offer.

III. Case study

1. On Friday 27th Nov. Buyer sends a telex to Seller offering to buy 1,000 tonnes of sugar at

the current market price. The telex is received in Seller’s offices after a short delay at 5 pm.

Since the telex operator has gone home for the weekend, Seller posts a letter in the last post on

Friday, accepting the offer. This reaches Buyer at 2.30 pm on Monday 30th Nov. Meanwhile, at

9.30 am on 30th Nov. Buyer sends a further telex to Seller withdrawing his offer. This reaches

Seller and is read by him immediately at 9.45 am on 30th Nov. Seller now seeks your advice.

Advise Seller.

Answer:

● Apply the mail box rule because the seller sent it from the afternoon of the 27th, there is a contract, the contract
is effective from the time the acceptance is sent
 ● Apply the reception rule, the contract is effective when the buyer receives the seller's offer → - no contract

● Áp dụng mail box rule vì ng bán gửi từ chiều ngày 27, có hợp đồng, hợp đồng có hiệu lực từ lúc gửi acceptance
đi

● Áp dụng theo reception rule thì hợp đồng có hiệu lực khi ng mua nhận đc offer của ng bán→-không có hợp đồng

2. Smart, a young sales representative employed by Speedy Ltd, a company manufacturing computers, visits Wiley, a partner in
Wiley and Fox, solicitors, with a view to selling a new computer to the firm. In the course of conversation, Smart, being
desperate to make his first sale for several days, offers the machine at £300 less than the normal selling price. Wiley says that he
will consult Miss Dragon, the head of the computer department, and let Smart have an answer by letter in a few days.

On returning to the area sales office Smart realizes that although he has authority to give special prices he might have been
unduly generous in his offer to Wiley. Accordingly he consults Allick, the area sales manager, who is not prepared to sell the
computer at the price at which Smart has offered it. Smart rings Wiley immediately but is unable to speak to him or any of the
other partners in the firm – even Miss Dragon is not available. Smart therefore writes a letter to Wiley revoking the offer and
posts it immediately by first-class mail. When Wiley arrives at his office on the following day he notices that among the incoming
mail is a franked envelope bearing the slogan ‘Speedy Ltd for your Computers’. It occurs to him that the envelope might contain
a retraction of the offer made by Smart and decides not to open it immediately. Instead he dictates a letter to his secretary
accepting the offer and tells her to post it before lunch. After lunch Wiley, having ascertained that his secretary has posted his
letter, opens the letter from Smart and discovers that it is indeed a revocation of the offer made the previous day. Nevertheless
Wiley ring Allick, the area sales manager of Speedy Ltd, and asks for delivery of the computer. Allick replies: ‘We cannot
possibly sell at this price. Surely you received our letter this morning?’ ‘Yes,’ say Wiley, ‘it came first delivery but I had already
posted my acceptance before I had a chance to open all my mail.’ Wiley intends to sue Speedy for breach of contract. Will he
succeed?

Which one of the following decisions is the court likely to make? and EXPLAIN why?

A. That Wiley accepted Smart’s offer when his secretary posted the letter of acceptance and Speedy is bound to sell the machine
at Smart’s price.

B. That Smart’s letter of revocation took effect after Wiley had had a reasonable time in which to read it after delivery. Since such
an opportunity occurred before Wiley accepted, Speedy is not bound.

C. That Smart’s offer was withdrawn when the letter of revocation was delivered so that Wiley’s acceptance was not
effective and Speedy is not bound.

D. That Smart’s offer was withdrawn when the letter of revocation was posted so that

Wiley’s acceptance is ineffective and Speedy is not bound.

According to revocation of the offer by the offeror: Offer can be withdrawn anytime before Offeree accepts the offer and its
effective when the Offeree receive it. In this case, Wiley will not succeed if he sues Speedy for breach because when Smart offers
the machine at £300 less than the normal selling price, Wiley still not accepts this offer. Therefore, Smart’s offer is not valid and
Smart (offeror) has the right to revocation of the offer; while, Wiley receives letter rejection before he requires his secretary post
accepting.

Agreement ends when letter is sent

Revocation becomes effective when received by Wiley

Thỏa thuận hết hiệu lực khi thư gửi đi

Revocation có hiệu lực khi wiley nhận đc

3. On 1 November Adder, an accountant, receives through the post at his office a large volume entitled Tax Made Easy.
Accompanying the volume is a note from the publishers, Messrs Galley & Co, stating that the volume will greatly assist Adder in
his work and that if he does not reply within seven days Messrs Galley & Co will assume that he wishes to purchase the volume
and they will expect to receive a remittance of £12. Adder does not wish to purchase the book but forgets to reply to Galley & Co.
At the end of the month he receives an invoice for £12 from the publishers. Is Adder obliged to pay for the book?

Which one of the following statements is correct? and EXPLAIN why?

A. Adder must pay for the book since he did not tell Galley & Co within seven days that

he did not want it.

B. Adder cannot be made to pay for the book but must return it to Galley & Co.

C. Adder must pay for the book because it is a business not a private transaction.

D. Adder cannot be made to pay for the book and need only make it available for Galley &

Co to repossess.

Answer:

● Chọn D

Silence is not acceptance

Im lặng ko phải acceptance

Offer: Messrs Galley & Co sent Adder the book along with a note stating that if he does not reply within seven days, they will
assume he wishes to purchase the volume for £12. This constitutes an offer to sell the book under certain conditions.

Silence does not constitute acceptance: In contract law, silence generally does not constitute acceptance of an offer. Adder's
failure to reply to Galley & Co's offer within seven days does not imply acceptance of the offer.

Unilateral contract: The offer made by Galley & Co is akin to a unilateral contract, where acceptance is made by performance of
a specified act. In this case, Adder's performance (or lack thereof) would indicate acceptance or rejection of the offer.

Unsolicited goods: Sending goods without prior request does not create an obligation to pay for them under English law.

Based on these principles, option D is correct. Adder cannot be made to pay for the book because he did not accept the offer by
failing to reply within seven days. Furthermore, as the book was sent unsolicited, it does not create an obligation to pay. Adder
need only make the book available for Galley & Co to repossess, as they have no legal basis to demand payment for unsolicited
goods.

Ex: Driving in a car, at a blind spot in the road, Walter honks his horn three times. Two blocks away, an elderly woman
believes the horn is an air raid siren and suffers a heart attack. Walter honked his horn, and the honking caused the
woman’s death.

In this case, there is no responsibility because this road has blind spots and by law it is allowed to honk.

Trong trường hợp này không phải chịu trách nhiệm vì đường này có điểm mù và theo luật thì được phép bấm còi

Ex: You have been asked to act as legal advisor to Catherine, advising her whether or not a contract exists between her
and David after the following course of events.

On Monday, David advertised a table and chairs for sale for £100 in the local newspaper. Catherine saw the
advertisement and telephoned David offering him £75. David offered to sell the table and chairs to Catherine for £80. She
accepted. Two days later, Catherine rang David and said that she would give him £85 if he delivered the table and chairs
as well. David refused. Catherine said that if she had to collect the table and chairs herself she would only give David £75.
During the course of their negotiations, Catherine and David have discovered that they know each other through the local
gardening club.

Indicate whether each of the following statements is TRUE or FALSE.

1.As Catherine and David are acquaintances, they cannot form a binding contract. FALSE

2. Catherine and David have not formed a valid contract as they have been unable to come to an agreement about price.
FALSE (có contract vì sell với giá 80 bảng)

3. Delivery is capable of constituting sufficient consideration for an increase in contract price. TRUE

4. If David accepts Catherine’s final suggestion, there will be a new contract between them at a price of £75FALSE (vì có thể
sửa đổi hợp đồng/ thêm điều khoản mới vào hợp đồng)

Case 1: Vokes v. Arthur Murray (Misrepresentation)

FACTS:

-Arthur Murray operated dancing schools through local, franchised operators.

-At a “dance party” at one of the schools, Vokes was praised by an instructor for her potential as “an excellent dancer.”

-The instructor sold her eight half-hour dance lessons for $14.50 each. Over the next 16 months, Vokes spent $31,090.45 on
dance lessons but finally realized she did not have the potential to be an excellent dancer.

-Vokes sued Arthur Murray and the court dismissed the case based on fraud. She appealed.

HELD: REVERSED. FOR VOKES.

-The District Court of Appeal of Florida reinstated the complaint and remanded.

- “A statement of a party having * * * superior knowledge may be regarded as a statement of fact although it would be
considered as opinion if the parties were dealing on equal terms. It could be reasonably supposed here that defendants
had ‘superior knowledge’ as to whether plaintiff had ‘dance potential.’”

Ex: Case: Lucy v. Zehmer (Intention)

FACTS:

-One night, while the parties drank whiskey and talked, Lucy said, “I bet you wouldn't take $50,000 for that place.” Zehmer
replied, “Yes, I would too; you wouldn't give fifty.”

-Later that night, Zehmer wrote out an agreement to the effect that he and Mrs. Zehmer agreed to sell the farm to Lucy for
$50,000.

-Lucy sued Zehmer to go through with the sale. Zehmer argued that he had been drunk and that the offer had been made in jest
and hence was unenforceable.

-The trial court agreed. Lucy appealed

HELD: REVERSED. FOR LUCY.

-The Zehmers were ordered to carry through with the sale.

-Noting that Lucy attempted to testify in detail as to what was said and done the night of the transaction, the state
supreme court concluded that “Zehmer was not intoxicated to the extent of being unable to comprehend the nature and
consequences of the instrument he executed, and hence that instrument is not to be invalidated on that ground.”
-The execution of the agreement was a serious business transaction the court found evidenced by a number of
circumstances.

Case 3: Goff-Hamel v. OBGYN (Promissory Estoppel)

FACTS:

-Julie Goff-Hamel worked for Hastings Family Planning for eleven years.

-OBGYN asked Goff-Hamel to work for OBGYN and Goff Hamel agreed to start in October and gave notice to Hastings in
August.

-The day before she was scheduled to start, OBGYN told her that she need not report to work.

-Goff-Hamel sued OBGYN seeking damages based on basis of detrimental reliance.

HELD: FOR GOFF-HAMEL.

-Promissory estoppel can be asserted in connection with an offer of at-will employment.

-OBGYN offered Goff-Hamel employment but refused to honor its promise of employment.

-Goff-Hamel relied upon OBGYN’ promise of employment to her detriment when she resigned her work.

Ex: Case 2: Powell v. MVE

FACTS: (Adequacy of Consideration)

-CAIRE is a subsidiary of MVE and manufactures home health-care products.

-R. Edwin Powell worked for CAIRE for thirteen years before becoming its chief executive officer (CEO) and president.

-In 1996, a group of investors became the primary owners of MVE. O’Halloran, MVE’s CEO and president, met with Powell,
and asked Powell to resign as CAIRE’s CEO, but continue to attend trade association board meetings and lobby Congress on
MVE’s behalf.

-Powell later claimed that O’Halloran offered, in return, that MVE would pay Powell $125.456 per share for his MVE stock.

-Powell did as O’Halloran asked until April, when O’Halloran asked him to stop. MVE refused to pay Powell $125.456 per share
for his stock.

-Powell sued MVE for breach of contract. The court ruled in Powell’s favor for $3.5 million in stock. MVE appealed.

HELD: AFFIRMED. FOR POWELL.

-The Appellate Court the award to Powell of nearly $3.5 million for his MVE stock.

- “[W]hen a contract is not supported by consideration, no valid contract is formed.”

-Powell’s lobbying efforts and “other tasks” on MVE’s behalf at O’Halloran’s request were consideration.

-The contract between Powell and MVE “is not void for lack of consideration” even if Powell’s efforts were not worth $3.5
million

Ex: Case 1: Hamer v. Sidway

FACTS: (Legal Sufficiency of Consideration)

-Story agreed to pay his Nephew $5,000 if he would refrain from drinking, using tobacco, swearing, and playing cards or billiards
for money until he became twenty-one. Nephew agreed and performed his part of the bargain.
-Nephew consented that the money remain with his uncle accruing interest. The uncle died about twelve years later without
having paid his nephew anything.

-Sidway, the executor of the uncle’s estate, did not want to pay the money to Hamer, a third party to whom the nephew had
transferred his rights in the money, claiming that there had been no valid consideration for the promise.

 HELD: FOR HAMER.

-Court ruled that Nephew had provided legally sufficient consideration by giving up smoking, drinking, swearing, and
playing cards or billiards for money until he became twenty-one and was therefore entitled to the money. Sidway argued
that the nephew had suffered no detriment.

-The court noted, “[T]he promise used tobacco, occasionally drank liquor, and he had a legal right to do so. That right he
abandoned for a period of years…”

Ex: Case: Industrial Lift v. Mitsubishi (Quasi Contracts)

FACTS:

 Industrial Lift (IL) agreed to buy forklift trucks from Mitsubishi to service and sell. Under the agreement, Mitsubishi
could terminate the deal without just cause on ninety days’ notice.

 IL made design changes in the truck to better suit the American market, which Mitsubishi did not request but later
incorporated into the trucks it sold to other dealers.

 In 1978, Mitsubishi terminated the agreement. IL sued under quasi-contract principles to recover benefits conferred on
Mitsubishi by the design changes. The suit was dismissed, and IL appealed

 HELD: AFFIRMED. FOR MITSUBISHI.

 Under the agreement, Mitsubishi did not have to compensate IL for its forklift improvements, which were
outside the express provisions of the contract.

 The court described a quasi contract as “fictitious and arising by implication of law wholly apart from the usual
rules” of contract formation.

 When a written contract already exists, however, normally no quasi-contractual claim can arise