SmallJW M3 A2

Topics: Contract, Contractual term, Breach of contract Pages: 8 (1728 words) Published: November 23, 2014

Sudson VS Letisha
John W Small
Argosy University
“A contract is simply a legally binding agreement between parties to do or not do something.”(WebLocator, 2011) Many things in today’s society have terms, conditions, and disclaimers. If a person is entering into an agreement be it: new software, cell phone service, home security service, garbage pickup, a financial agreement; i.e. to purchase a house, a car, a boat, a new credit card, student loans, etc… all of these require a person to sign a contract, and all contracts have terms, conditions and disclaimers. Sudson VS Letisha

Though the information that has been given to us is not complete, we do know that Letisha signed a five year contract for the rental of the coin operated washer and dryer. We also know that she did not bother to fully read all the terms, conditions, and disclaimers of the contract before she signed. Even if Sudson’s sales representative was slightly unethical, if Letisha does not pay, Sudson can sue her for breach of contract. Letisha needs to lodge a complaint with the Attorney General or the Better Business Bureau. Fortunately for Letisha, with the information that is given, if this does go to court she will win the case. Whenever someone is going to sign a contract they need to read all the terms, conditions, and disclaimers before signing, because by signing they are agreeing to all terms, conditions, and disclaimers. As a person is reading they should look for things such as; “an automatic renewal or evergreen clause which allows an agreement to continue for a defined period if the existing agreement isn't renegotiated within a specified time measured from the expiration of the current contract,” (USLegal, 2011) or the condition that the seller/leaser/financial institution can make changes to the terms, conditions, and disclaimers with or without notifying the buyer. Also, if a person cannot understand the legal terminology of a contract they should have an attorney look it over and explain the contract and any terms, conditions, or disclaimers involved before they sign. If they don’t read or understand a contract or the terms, conditions or disclaimers involved, but sign anyways, they are still going to be held liable. If Letisha does not pay and Sudson sues her for breach of contract, what legal arguments could be raised in Letisha’s defense against the enforcement of the automatic renewal clause? When the contract was first written California had limited laws on auto renewal for leases, they only applied to real property leases. There was no provision to the renewal of a lease for business equipment. (RunTam38, 2008) As of December 1, 2010 that changed, Letisha is now protected commencing with Section 17600 of Article 9 of Chapter 1 of Part 3 of Division 7 of the Business and Professions Code Automatic Purchase Renewals. Sudson can not initiate an automatic renewal without first getting Letisha’s consent and must provide “a toll-free telephone number, electronic mail address, or a postal address, only when the seller directly bills the consumer, or another cost-effective, timely, and easy-to-use mechanism for cancellation that shall be described in the acknowledgment specified in paragraph (3) of subdivision (a).” (AroundtheCapitol, 2011) There will be no grandfathering of the auto renewal policy of this contract. If Sudson wants Letisha to continue to be a customer, Sudson will have to initiate a new contract for her to sign. According to the new law, the auto renewal policy will have to stand out from the surrounding text of the new contract. What legal arguments could be raised by Sudson in support of the enforcement of the automatic renewal clause against Letisha? Though the sales person should have told her to “Become familiar with the additional terms, conditions, and disclaimers on the back of the contract,” She should have looked for and read these...

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Kubasek, N.K., Brennan, B.A., & Browne, M.N. (2009). The Legal Environment of Business: A Critical Thinking Approach (5th ed.). Upper Saddle River, NJ: Pearson Learning Solutions
Lady Lawyer (2009). Consumer Protection Law. Retrieved from
RunTam38 CA lawyer (2008). What is the law regarding an automatic lease. Retrieved from
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