Business Laws and Ethics

a.) In this situation, the Uniform Commercial Code embraces the laws of commercial transactions by covering the lease or sale of and payment for goods from start to finish. Sales and leases fall under Article 2 and Article 2A, respectively. Article 2 specifically applies to the contracts about the sale of goods, which is the same case in this situation.

• A contract is formed when there is an agreement between two parties, a vendor and a buyer, on exchanging goods for a certain price. To form a contract, one of the parties must make an offer; the other party must accept the offer, and consideration, or something of value, must be exchanged both ways. The parties have a binding contract once an offer has been made and accepted.
• Yes, a contract was formed for the situation in the question above. First, Reginald made an offer: “He takes out an ad online and lists the vehicle for $25,000.” Jane accepted the offer made by the vendor (Reginald), “Jane decides to purchase the Bronco and writes a $2500 check to Reginald as a deposit for the Bronco”. When Reginald offered to sell the Ford Bronco at $25,000, this promise was worth something. When Jane accepts the offer, deposits $2500, and promises to pay the remaining balance the next day, after the car keys are handed over to him, this promise is worth something too. Hence, consideration flows both ways, thereby forming a binding contract.

b.) Statute of fraud refers to a written law requiring certain contracts to be in writing and signed by all the parties bound by the contract to prevent fraud or any other harm or injury.

• No, the statute of frauds will most likely not hurt Jane’s arguments under the stated facts. This is because Jane had initially deposited $2500 for the purchase, which Reginald accepted even though he had not yet cashed it. This indicates that there was a partial performance from Jane under the contract, therefore, making their oral contract enforceable as specified in the three exceptions of the statute of fraud(Admission, performance, and promissory estoppel).

c.) Yes, Jane has arguments to make before a court of law against Reginald by claiming there was a breach of contract under anticipatory breach, where the breaching party tells the non-breaching party that they will not be fulfilling the terms of their contract.  For this situation, Reginald informed Jane that he could deliver the car since he had already sold it to someone else.

• Jane can win the breach of contract case by tabling sufficient and truthful evidence and ensuring she abides by timeliness considering the statute of limitations, which specifies the time a claim must be brought before the court and claiming for damages. She already had a duplicate of the check she used to make the deposit which would highly serve in her favor as evidence.
• Jane could collect damages from Reginald if she prevails in the case. She could claim compensatory damages or seek restitution from Reginald.
• Under the UCC, Jane can get damages for the breach equal to the difference between the contract price and the market price when she learns of the breach, plus any incidental and consequential damages permitted by the UCC. As stated in the facts, “The cheapest comparable Bronco Ann can find elsewhere is $35,000,” which can be considered the market price, and she can claim $10,000 ($35,000 – $25,000) from Reginald as the law allows.