Contract analysis scenario two—remedies determination: Mundo manufactures printing presses. Extra, a publisher of a local newspaper, had decided to purchase new presses. Rep, a representative of Mundo, met with Boss, the president of Extra, to describe the advantages of Mundo’s new press. Rep also drew rough plans of the alterations that would be required in Extra’s pressroom to accommodate the new presses, including additional floor space and new electrical installations, and Rep left the plans with Boss.
On December 1, Boss received a letter signed by Seller, a member of Mundo’s sales staff, offering to sell the required number of presses at a cost of $2.4 million. The offer contained provisions relating to the delivery schedule, warranties, and payment terms but did not specify a particular mode of acceptance of the offer. Boss immediately decided to accept the offer and telephoned Seller’s office. Seller was out of town, and Boss left the following message: “Looks good. I’m sold. Call me when you get back so we can discuss details.”
Using the rough plans drawn by Rep, Boss also directed that work begin on the necessary pressroom renovations. By December 4, a wall had been demolished in the pressroom, and a contract had been signed for the new electrical installations.
On December 5, the President of the United States announced a ban on foreign imports of computerized heavy equipment. The ban removed—from the American market—a foreign manufacturer that had been the only competitor of Mundo. That afternoon, Boss received an email from Mundo stating, “All outstanding offers are withdrawn.” In a subsequent telephone conversation, Seller told Boss that Mundo would not deliver the presses for less than $2.9 million.
In a minimum of a 1,000-word contract analysis, discuss the following questions: Was Mundo obligated to sell the presses to Extra for $2.4 million? Assume Mundo was so obligated. What are Extra’s rights and remedies against Mundo?
Cite any direct quotes or paraphrased material from outside sources. Use APA format.
Answer preview
Extra has a few rights regarding the contract provided by Mundo to offer the press machines for $2.4 million rather than the new price of $2.9 million provided later by Mundo. First, Extra has the right to an injunction on Mundo. An injunction is a legal court order that focuses on enforcing a specific individual or party to perform or refrain from performing particular acts at particular times (Barnett & Oman, 2016). In the case of Extra and Mundo, the original contract indicated the price settled for the equipment was $2.4 million. Instead of complying with the deal, Mundo went ahead to introduce another contract worth $2.9 million for the same contract. In this case, Extra has the right to apply for an injunction on Mundo resulting from the failure of the firm to deliver on the specified terms and conditions. After the court
[1212 Words]
