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  • 1. Business Law Chapter 13 Sections 1-2 Mr. Whisel
  • 2. Hot Debate
    • June was an accomplished opera singer. She contracted to sing for the San Francisco Opera over Labor Day weekend for $5000. About a month before her performance, she was offered another role that paid twice as much. June offered to pay the $5000 to her friend Sara, an equally accomplished opera singer, to fill in for her on Labor Day weekend, Sara agreed. When June told the San Francisco Opera, they said they wouldn’t pay the money.
    • Why should/shouldn’t they pay June?
  • 3. Section 13.1 Goals
    • Describe which rights can be assigned
    • Identify what duties can be delegated.
    • Standards
    • PCCG OUTCOME: 13
    • PCCG STANDARDS: C: 1.1c, 1.1d, 1.1e, 1.1d, 1.2a, 1.3a, 1.4d, 1.6a, 1.6c, 1.6d, 1.6e, 1.7c, 1.8b, 1.8c, 2.2b, 5.1a, 5.1j, 5.1l, 5.2a, 5.3a, 5.3g, 5.4a,, 13.1e, 13.2b, 13.3b
  • 4. What’s Your Verdict?
    • Whippet bought a high-powered sports coupe from Oriental Motors for $32,000. After a down payment of $2,000, the balance, plus a finance charge, was to be paid in installments over the following 48 months. Oriental Motors needed cash to restore its inventory of new cars. Therefore, it immediately sold. Whippet’s contract to the finance company and told Whippet to make all installment payments to the finance company.
    • Is such a transfer of contract rights legal?
  • 5. Contractual Rights
    • Rights that you receive under a contract, that can transfer to others.
    • Assignment
      • Transferring of rights from a contract
    • Assignor
      • Party transferring the rights
    • Assignee
      • Party receiving the rights to the contract
  • 6. Assignable Rights
    • Performance
      • The fulfillment of contractual promises as agreed.
    • Restaurant
      • Credit Cards for sales
  • 7. Non-Assignable Rights
    • Rights that cannot be transferred if performance would be materially changed
    • Rights that cannot be transferred if performance becomes substantially more difficult
    • A right created under a contract that prohibits transfer of the contractual rights
    • Claims for damages for personal injuries
    • Claims against the U.S.
    • Right to personal services especially those of a skilled nature, or when personal trust and confidence are involved
    • Assignments of future wages, as limited by state statutes
  • 8. Forming A Transfer of Rights
    • Usually valid either written or orally
      • Always wiser to be written
    • Most states require that certain assignments be in writing
    • No consideration is necessary to make a valid assignment
  • 9. What’s Your Verdict?
    • Ramirez hired Norton to come to her home and care for her two young children while she was at work
    • Could Norton legally delegate the child-care duties to a third party?
  • 10. Contractual Duties
    • Legal obligations created by a contract
    • When buying and selling you have a duty to pay and someone has the right to collect
    • Routine duties can often be transferred known as delegation of duties
    • Cannot delegate to another any duty where performance requires a personal skill or special qualification
  • 11. Contractual Duties
    • Someone who delegates contractual duties remains legally obligated and responsible for proper performance.
    • School Contractor- Nello Construction
  • 12. What’s Your Verdict?
    • Ginsburg, a concert violinist, purchased “a genuine Straivarius” violin from Krone for $250,000. Ginsburg paid $50,000 down and agreed to pay the balance in 24 equal monthly installments. Krone knew the violin was not a Stradivarius. He immediately assigned his right to collect the balance of $200,000 to Continental Finance for $90,000 in cash. Continental notified Ginsburg of the assignment. Krone then disappeared. Shortly after, Ginsburg discovered the fraud.
    • Can Ginsburg refuse to pay continental if it tries to collect?
  • 13. Obligations
    • Obligor
      • The one who owes a duty under contract
    • Obligor’s Liability
      • If transferred, they get no more or no less but equal to that of the original contract.
    • Obligor’s Breach
      • If you do not perform as stated the assignee may in fact sue for breach of contract
  • 14. End of Section 13.1
    • Think About Legal Concepts
    • Think Critically About Evidence
  • 15. Section 13.1 Goals
    • Describe which rights can be assigned
    • Identify what duties can be delegated.
    • Standards
    • PCCG OUTCOME: 13
    • PCCG STANDARDS: C: 1.1c, 1.1d, 1.1e, 1.1d, 1.2a, 1.3a, 1.4d, 1.6a, 1.6c, 1.6d, 1.6e, 1.7c, 1.8b, 1.8c, 2.2b, 5.1a, 5.1j, 5.1l, 5.2a, 5.3a, 5.3g, 5.4a,, 13.1e, 13.2b, 13.3b
  • 16. Section 13.2 Goals
    • Describe how contracts are usually satisfied
    • Explain the ways contracts can be discharged other than by performance of their terms
    • Standards
    • PCCG OUTCOME: 13
    • PCCG STANDARDS: C: 1.1c, 1.1d, 1.1e, 1.1d, 1.2a, 1.3a, 1.4d, 1.6a, 1.6c, 1.6d, 1.6e, 1.7c, 1.8b, 1.8c, 2.2b, 5.1a, 5.1j, 5.1l, 5.2a, 5.3a, 5.3g, 5.4a,, 13.1e, 13.2b, 13.3b
  • 17. What’s Your Verdict?
    • Wesley promised to loan Hudson $900 within three months in return for Hudson’s promise to paint Wesley’s house. Hudson did not paint the house as promised. She did offer to give Wesley and aquamarine ring that had a retail value of about $1000, and a wholesale value of $500 instead of painting the house
    • Must Wesley accept the ring instead of the painting of his home?
  • 18. Discharge
    • The termination of the duties that ordinarily occur when the parties perform as promised
    • Breach of Contract
      • Failure to perform complete performance
      • In sales this is called a cancellation
    • Substantial Performance
      • All duties but a minor duty under the contract remains.
        • Minor Breach
  • 19. More Discharge
    • Default
      • Failure to perform
    • Someone who is going to default can let the other party know that he/she is not going to perform
      • Called Anticipatory Breach
  • 20. What’s Your Verdict?
    • Diaz was the owner of a landscape service. He contracted to maintain the yard of Reingold while she sailed around the world in a 45-foot yacht. Reingold planned to write and take photographs for a national magazine and had no fixed itinerary or schedule for the journey.
    • When would the contract with Diaz terminate?
  • 21. How to Discharge Other Than Performance
    • Agreement
      • Both parties meet and agree to terminate
        • Rescission
    • Impossibility of Performance
      • Unforeseen Event (Death, Flood, Natural Disaster, Destruction of Subject)
    • Operation of Law
      • Bankruptcy
      • Alteration
        • Material change in the terms of a written contract without consent of the other party
  • 22. What’s Your Verdict?
    • Zamorsky, a professional artist, agreed to paint Quincy’s portrait for $5,000. Five sitting of two hours each were scheduled at times selected by Quincy, but he failed to appear for any of them. To accommodate her client, Zamorsky then offered to come to Quincy’s home or office for rescheduled sitting at his convenience. Quincy rejected this proposal. Is Zamorsky legal obligation discharged?
    • Is Quincy liable for damages?
  • 23. Tender of Performance
    • Offer to perform an obligation
    • Legal Tender
      • Currency or coins
      • Tender of performance involving money
  • 24. End of Section 13.2
    • Think About Legal Concepts
    • Think Critically About Evidence
    • Chapter in Review
  • 25. Section 13.2 Goals
    • Describe how contracts are usually satisfied
    • Explain the ways contracts can be discharged other than by performance of their terms
    • Standards
    • PCCG OUTCOME: 13
    • PCCG STANDARDS: C: 1.1c, 1.1d, 1.1e, 1.1d, 1.2a, 1.3a, 1.4d, 1.6a, 1.6c, 1.6d, 1.6e, 1.7c, 1.8b, 1.8c, 2.2b, 5.1a, 5.1j, 5.1l, 5.2a, 5.3a, 5.3g, 5.4a,, 13.1e, 13.2b, 13.3b