Big Time Toy Maker

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Big Time Toymaker


University of Phoenix

Matt Johnson

May 21, 2012

Jacques Ward

1. At what point, if ever, did the parties have a contract?

BTT and Chou reached an agreement when BTT paid him the $25,000 in exchange for exclusive negotiation rights for a 90 day period. Although the negotiation agreement specified no distribution contract existed unless it was in writing, the two came to an oral agreement three days prior to the 90 day deadline. This was followed up by a correspondence by the BTT manager in the “Strat Deal” e-mail that confirmed the oral agreement between Chou and BTT.

2. What facts may weigh in favor of or against Chou in terms of the parties objective intent to contract?

The e-mail from the BTT manager confirms the distribution contract exists and also that an oral agreement was reached. BTT also sent a fax requesting a draft for a distribution agreement and Chou immediately responded.

3. Does the fact that the parties were communicating by e-mail have any impact on your analysis in Questions 1 and 2?

Yes, the e-mail is the confirmation of the contract. Without the e-mail from the BTT Manager Chou would not, or would any reasonable person believe that a contract existed.

4. What role does the statue of frauds play in this contract?

The statue of frauds specifically calls for a signature of the party against whom the enforcement of a contract is being sought. Though the mail-box rule comes into effect and states that the acceptance of an offer is generally effective upon dispatch using a commercially reasonable manner, such as mail, fax, or e-mail. An e-mail can satisfy the requirement of a signed contract.

5. Could BTT avoid this contract under the doctrine of mistake? Explain. Would either party have any defenses that would allow the contract to be avoided?

Doubtful. According to Melvin, a mistake refers to...
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