Law 421

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  • Topic: Contract, Gentlemen's agreement, Truth
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  • Published : November 11, 2012
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Case Scenario: Big Time Toymaker

LAW/421

Case Scenario: Big Time Toymaker

Read the “Theory to Practice” section at the end of Ch. 6 of the text.

Answer Questions 1 through 6 based on the scenario in the “Theory to Practice” section, and complete the following in your response:

At the conclusion of the situation, BTT says that it's not serious about releasing Chou’s new technique game, Strat. Presuming BTT and Chou have got a deal, and BTT has breached the agreement by not releasing the game, discuss what solutions may or may not apply.

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

By studying the situation, I don't believe the 2 sides concerned ever had a deal. In the situation, the sides reached a deal just 3 days ahead of the conclusion of a 90-day time frame set in the initial negotiation deal. In the initial negotiation deal, it says that there would be no distribution agreement until it was on paper. As soon as the BTT manager posted the e-mail to Chou, he described the conditions of a distribution contract; however it doesn't make the email an agreement as neither side inked it. Just a verbal deal was reached. With no legally binding draft and the signature of both sides present, no agreement existed.

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

BTT had paid out Chou $25,000 for the unique negotiation legal rights to his board game, and this element would cause Chou to think they were interested in arriving at a deal on a distribution agreement. It is a fact which would weigh in support of Chou. But, both sides just made a verbal deal, and not a written agreement to demonstrate this fact. As the agreement wasn't drawn up during the initial 90-day interval, the new administration wasn't responsible to distribute the board game, and hence, had every reason to move Chou away rather than honoring the verbal agreement.

Does the fact...
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