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4 pages/≈1100 words
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APA
Subject:
Business & Marketing
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Case Study
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English (U.S.)
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Topic:

Elements of Legal Contract

Case Study Instructions:

SCENARIO: Jim and Laura Buyer visit the local car dealership because they are interested in buying a new car. The car they currently have is aging and is starting to have mechanical problems. Jim and Laura would share the new car, and use it to go back and forth to work and school. Before going to the dealership, Jim and Laura decide that they can only afford $400.00 a month in car payments.
Once at the car dealership, Jim and Laura meet Stan Salesman. Stan shows them several vehicles and Jim and Laura test-drive several of the cars. Jim and Laura particularly like the blue 4-door sedan. Therefore, they agree to give Stan Salesman a $100.00 deposit to hold the car for a day. Stan Salesman does not give them the receipt but guarantees that the $100.00 is refundable. No documents were signed.
The next day, Stan Salesman calls Jim and Laura to ask them when they would like to take delivery of the car. Jim and Laura, on the way home from the dealership, decided that they were not going to buy the car because they did not want to spend that money each month. Therefore, Jim and Laura tell Stan Salesman that they have decided not to buy the car and request their $100.00 deposit back.
Stan insists that the $100.00 was a deposit on the car and was meant to be part of the contract to buy the car. Stan is very persistent and insistent that Jim and Laura have contracted to buy the car; therefore, the $100.00 will be applied to the purchase price of the car. Jim and Laura are shocked and angry as not only do they not want to spend the money, but now feel as though they are being duped by Stan Salesman.
Jim and Laura have an appointment to see a lawyer in a few days, but know you are a student taking a business law class and come to you for advice. They are very frazzled, and understandably upset that they may have just purchased a car. Since you have been taking business law, you have read and understand the elements of a contract and the defenses to a contract. Therefore, although you are not a lawyer, you provide some basic advice from what you’ve learned in your business law class.
ASSIGNMENT: In three to five (3-5) pages, advise Jim and Laura based on the above facts as presented and the material covered in the lessons. In your paper, be sure to address the following:
Define the elements of a legal contract using examples from the scenario where applicable.
Decide whether or not there was a contract for the purchase of the automobile.
Identify the facts from the scenario which support your decision on whether or not a contract exists for the purchase of the automobile.
Use at least two (2) quality academic resources in this assignment. Note: Wikipedia and other websites do not qualify as quality academic resources.
Composition must be 3-5 pages (approximately 750-1250 words).
Double-space the composition and use one-inch margins.
Use a readable 12-point font.
All writing must be appropriate for an academic context.

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Case Study
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Elements of Legal Contract
Several people might argue that a legal contract must be in written form. However, as much a written contract is critical in pointing out the evidence of agreements during a legal battle, the writing alone is not an element of its legality. A contract can be oral, just as between Jim and Laura and Stan Salesman, only that it must have some aspects for it to be deemed legal. Mutual assent is one key element of a legal contract (Miller, 2016). The mutual assent element of a contract is denoted by two factors: an intent to be bound and definiteness. Intent to be bound seeks to ensure that a reasonable person in a promisee's position understands the promiser's communication and intention to be bound by the agreements on one hand (Miller, 2016).
On the other hand, intent to bound ensures that the promisee believes that the legitimate offer was made (Miller, 2016). Regarding the case between Stan Salesman and Jim and Laura, it is evident that Stan Salesman made an offer. Both parties were in some form of a binding agreement, hence why Jim and Laura agreed to pay a refundable $100 to hold the car.
Secondly, a legal contract must contain an offer. A price tag alone is not an indication of an offer. Legally, the offer constitutes a series of actions where the buyer should then make an order after the offer, and in return, the seller must accept the order. A complete series of offers, orders, and acceptance is referred to as an offer in a legal agreement (Knapp, Crystal & Prince, 2019). In the case study, however, it is hard to determine whether the offer was made as the only thing that comes up is the refundable $100 that Jim and Laura paid to hold the car. There is no mention of any offer that was made. However, by agreeing to pay the $100 for the car to be held, it can be assumed that Stan Salesman had accepted the order from Jim and Laura.
Offers can, however, be terminated through rejection, revocation, lapse, or death (Miller, 2016). Rejection of an offer here implies countering the offer. Revocation refers to a decision not to continue with the proposed agreement, while lapse means that an offer collapses when the specified time expires (Knapp, Crystal & Prince, 2019). Acceptance of an offer is also another element of a contract, where a party agrees to the offer provided. Consideration is another critical element of contract law as it serves the purpose of reciprocity to make the contract binding to both parties (Miller, 2016).
Reference of the elements of a contract to the case study
From the look of the case study regarding the elements that constitute a legal contract, it is convincible to argue that there was a leg...
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