Download Acceptance of Offer - Contracts - Exam and more Exams Contract Law in PDF only on Docsity!
CREIGHTON UNIVERSITY SCHOOL OF LAW
CONTRACTS - A & B FALL SEMESTER EXAMINATION
Professors Shkolnick & White Monday, December 5, 1994
PART I
Page 1 of 6
INSTRUCTIONS: THIS IS A THREE-HOUR CLOSED BOOK EXAMINATION. EACH PART
HAS BEEN ALLOTTED ONE AND ONE-HALF HOURS. BOOKS, STUDY NOTES,
OUTLINES AND ANY OTHER MATERIALS ARE NOT PERMITTED IN THE
EXAMINATION ROOM. YOUR ANSWERS MUST BE SUPPORTED BY YOUR REASONS.
THE TIMES INDICATED REPRESENT OUR ESTIMATE AS TO THE TIME YOU SHOULD
ALLOCATE TO EACH QUESTION.
PLACE YOUR EXAM NUMBER, SECTION, PROFESSOR'S NAME AND COURSE
TITLE ON EACH BLUE BOOK. IF YOU WRITE MORE THAN ONE BOOK, NUMBER THE
BOOKS, e.g., 1 of 2, 2 of 2. PLEASE WRITE ON EVERY OTHER LINE OF THE BLUE BOOK.
QUESTION NO. 1: (30 Minutes)
Selor, a manufacturer of various products, including gizmos, and Byer, a furniture company that used gizmos in the production of the furniture it produced for sale, had some preliminary discussions concerning gizmos without reaching any agreement. On February 1, 1994, Selor sent the following letter to Byer:
February 1, 1994
Dear Byer:
We hereby offer to sell to you such quantity of gizmos as you may order (up to 2, gizmos per calendar month) during the next 12 months ending on January 1, 1995. Our price for these gizmos is $30.00 per gizmo.... (description of the gizmos and delivery information was given)... This is a firm offer and will be held open for the stated period of 12 months from today. If you accept, please let us know.
/s/ Selor
Upon receipt of this letter, Byer wrote "I accept your offer" on the original, made a photocopy, and returned the original to Selor on February 10, 1994.
During February, March, April and May, Byer ordered various quantities of gizmos from Selor and all orders were promptly filled.
- Continue Question 1 next page -
Professors Shkolnick & White Monday, December 5, 1994
PART I
Page 2 of 6
QUESTION NO. 1: (Cont'd)
On July 10, 1994, Byer mailed an order to Selor, which stated:
July 10, 1994
Dear Selor:
Please send us 1,000 gizmos @ $30 a gizmo per our agreement.
/s/ Byer
On July 11, 1994, Byer received the following letter from Selor:
July 9, 1994
Dear Byer:
We regret to inform you that we will no longer sell gizmos at $30 a gizmo. Due to increased demand and other considerations, our gizmos are priced at $35.00. We will continue to supply gizmos to you at this new price, but we will not sell at $30.00.
/s/ Selor
Byer responded:
July 12, 1994
Dear Selor:
We have a contract for 1,000 gizmos at $30 and we expect you to honor it. You will also fill our future orders or you will see us in court.
/s/ Byer
- Continue Question 1 next page -
Professors Shkolnick & White Monday, December 5, 1994
PART I
Page 4 of 6
QUESTION NO. 2: (30 Minutes)
Selena, a breeder of minks and rabbits, responded as follows to a telephone request for price information from Belinda, a fur coat manufacturer.
November 10, 1993
Dear Belinda:
We propose to supply all of your needs for mink and rabbit pelts for the 1994-1995 coat season. I enclose a copy of our volume discount price list and our standard sales terms. We look forward to doing business with you.
/s/ Selena
The form Selena enclosed provided that payment was due 30 days from the date of delivery and contained the following price information.
Per Hundred Weight
Grade A pelts $ Grade B pelts $ Grade C pelts $
Belinda responded on November 16, 1993.
November 16, 1993
Dear Selena:
I was happy to receive your offer and look forward to doing business with you. I enclose our standard purchase order terms and conditions.
/s/ Belinda
The preprinted terms of Belinda's enclosed form contained the following language: "Our acceptance is subject to your agreement to abide by all terms and conditions contained herein." The form also provided for arbitration of all disputes and for payment within 60 days of delivery.
- Continue Question 2 next page -
Professors Shkolnick & White Monday, December 5, 1994
PART I
Page 5 of 6
QUESTION NO. 2: (Cont'd)
Part A
Assume for purposes of this part of the question that after Selena received Belinda's correspondence of November 16, 1993, she received a better offer from one of Belinda's competitors. Selena consults you and asks the following questions:
1) Did the parties' exchange of documents result in a contract? Explain.
2) Assuming that the correspondence did create a contract, must all disputes be arbitrated? Explain.
3) Assuming that the correspondence did create a contract, when is payment due? Explain.
Part B
Assume for purposes of this part of the question that on March 10, 1994, Selena received Belinda's order for a specified assortment of pelts and that Selena shipped the pelts the next day. A dispute has now arisen about the quality of the goods as well as the time payment is due.
1) Assuming that no contract was formed on the initial exchange of documents between the parties, do they now have a contract? Explain.
2) Assume that your conclusion to Question B1 is yes, there is a contract; is arbitration of disputes required? Explain.
3) Assume that your conclusion to Question B1 is yes, there is a contract; when is payment due? Explain.
