Discuss the issues raised, the arguments for both parties and the applicable law.

Question 1.

Carol hired Ben to represent her in her contract suit against Abe. Pursuant to Ben’s written agreement to provide legal services to Carol, he was to receive a fixed fee of $5,000 plus 50% of any amount recovered in excess of $100,000. Ben had performed substantial work on the case, and incurred some $200 worth of photocopying costs, before Carol discharged him without cause. Ben estimates that, based on his hourly rate, he had done about $12,000 worth of work on the case. Carol paid him nothing.

Carol replaced Ben with Debra, who billed $1,300 worth of work on the case and recovered $120,000 in settlement from Abe. Upon hearing of Debra’s success, Ben got so upset that he missed a day of work–a day when Elmer, an important client, happened to call with an emergency problem. Because Ben was not available, Elmer paid a competing law firm $30,000 to resolve his problem. The result so pleased Elmer that he decided to transfer all of his legal business from Ben to the competing firm, a loss that Ben estimates at $580,000.

Ben sues Carol for breach of contract.

Discuss the issues raised, the arguments for both parties and the applicable law.

State your conclusions and the reasons therefore.

Question 2

Being an expert in contract law, you are helping your professor write a critical article about the issue of “incapacity” to enter into a contract. You have been asked to consider expanding the category of “incapacity” to include poverty and/or lack of education.

You have been asked to do the following:

Discuss the concept of “incapacity” as it exists in contract law today.

Discuss the arguments for and against the expansion of the concept of incapacity as suggested above.

State your conclusions regarding expanding the concept of “incapacity” and the reasons therefore.


Question 3

Art and Betty own adjoining farms in County, an area, where all agriculture requires irrigation. Art bought a well-drilling rig and drilled a 400-foot well from which he drew drinking water. Betty needed no additional irrigation water, but in January 2011, she asked Art on what terms he would drill a well near her house to supply better tasting drinking water than the County water she has been using for years. Art said that because he had never before drilled a well for hire, he would charge Betty only $10 per foot, about $1 more than his expected cost. Art said that he would drill to a maximum depth of 600 feet, which is the deepest his rig could reach. Betty said, “OK, if you guarantee June 1 completion.” Art agreed and asked for $3500 in advance, with any additional further payment or refund to be made on completion. Betty said, ” OK,” and paid Art $3500.

Art started to drill on May 1. He had reached a depth of 200 feet on May 10 when his drill struck rock and broke, plugging the hole. The accident was unavoidable. It had cost Art $12 per foot to drill the 200 feet. Art said he would not charge Betty for drilling the useless hole, but he would have to start a new well close by, and could not promise its completion before July 1.

Betty, annoyed by Art’s failure, refused to let Art start another well and on June 1, she contracted with Carlos to drill a well. Carlos agreed to drill to a maximum depth of 350 feet for $4500, which Betty also paid in advance, but Carlos could not start drilling until October 1. He completed drilling and struck water at 300 feet on October 30.

In July, Betty sued Art seeking to recover her $3500, plus the $4500 paid to Carlos.

On August 1, County’s dam failed, thus reducing the amount of water available for irrigation. Betty lost her apple crop worth $15,000. The loss could have been avoided by pumping from Betty’s well if it had been operational by August 1. Betty amended her complaint to add the $15,000 loss.

In her suit against Art, what are Betty’s rights and what damages, if any, will she recover?

Discuss the issues raised, the arguments for both parties and the applicable law

State your conclusions and the reasons therefore.

Question 4

Ann wanted to purchase a gift for her boyfriend, Ben. Ann and Ben went to Ritz Jewelry to select the gift. Charles, the store manager, assisted them. Ann explained to Charles that she wanted to purchase a gift for Ben, and that Ben could select whatever he wanted. Ben chose a large gold chain costing $2,400.

Ann and Ritz executed a written installment sales contract which identified the chain as “solid 18K gold,” stated the purchase price of $2,400 which was to be paid by Ann in twenty-four equal monthly payments.

Ben wore the gold chain proudly, but the relationship with Ann ended a few months later. When the two parted, Ann made it clear that Ben could keep the gold chain. Ben subsequently took the chain to another jeweler for cleaning and then discovered that the chain was not solid gold after all, but rather was gold plated and the thin gold plating was wearing off the chain. Ben decided to make a claim directly against Ritz for misrepresenting the chain’s quality, without involving Ann.

When Ben made the claim against Ritz, Ritz informed Ben that Ritz had assigned the contract and its right to receive payments from Ann to CreditCo, a finance company. Ritz had previously notified Ann of the assignment. Ann had paid six of the twenty-four payments due under the installment sales contract. However, when Ann learned that the gold chain was not solid 18K gold as represented, she stopped making any more payments to CreditCo.

1. Can Ben prevail in a breach of contract action against Ritz? Discuss.

2. Is the assignment by Ritz to CreditCo effective? Discuss.

3. Can CreditCo prevail in a breach of contract action against Ann? Discuss.

For each of the above questions:

Discuss the issues raised, the arguments for both parties and the applicable law

State your conclusions and the reasons therefore.

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