6. he gave her a check in the amount of $17,617.83, on which he
wrote “Final payment/payment in full.” Hylton cashed the
check, but she wrote on it, “Under protest—cashing this check
does not constitute my acceptance of this amount as payment in
full.” Hylton then filed suit, demanding additional monies.
Meztista claimed that the parties had made an accord and
satisfaction. What is the best argument for each party? Who
should win?
3. ETHICS Melnick built a house for Gintzler, but the
foundation was defective. Gintzler agreed to accept the
foundation if Melnick guaranteed to make future repairs caused
by the defects. Melnick agreed but later refused to make any
repairs. Melnick argued that his promise to make future repairs
was unsupported by consideration. Who will win the suit? Is
either party acting unethically? Which one, and why?
4. Sami walks into a restaurant. She is given a menu, which
indicates that lobster is $30. Sami orders the lobster. It arrives,
and Sami thinks it is very tasty. When the bill arrives, Sami
tries to execute a clever ploy she learned about in her business
law class. She writes a check to the restaurant for $20 and
writes “full settlement” across the top. The waiter accepts the
check without looking at it, and the restaurant manager later
deposits it in the restaurant’s bank account. Is this a liquidated
or an unliquidated debt? Is Sami off the hook for the last $10?
5. In the bleachers … “You’re a prince, George!” Mike
exclaimed. “Who else would give me a ticket to the big game?”
“No one, Mike, no one.” “Let me offer my thanks. I’ll buy you a
beer!”
CHAPTER 11 Consideration 273
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“Ah,” George said. “A large beer would hit the spot right now.”
“Small. Let me buy you a small beer.” “Ah, well, good enough.”
Mike stood and took his wallet from his pocket. He was
distressed to find a very small number of bills inside. “There’s
bad news, George!” he said. “What’s that?” “I can’t buy you the
beer, George.” George considered that for a moment. “I’ll tell
you what, Mike,” he said. “If you march to the concession stand
right this minute and get me my beer, I won’t punch you in the
face.” “It’s a deal!” Mike said. Discuss the consideration issues
raised by this exchange.
2. Brockwell left his boat to be repaired at Lake Gaston Sales.
The boat contained electronic equipment and other personal
items. Brockwell signed a form stating that Lake Gaston had no
responsibility for any loss to any property in or on the boat.
Brockwell’s electronic equipment was stolen and other personal
items were damaged, and he sued. Is the exculpatory clause
enforceable?
3. Guyan Machinery, a West Virginia manufacturing
corporation, hired Albert Voorhees as a salesman and required
him to sign a contract stating that if he left Guyan, he would not
work for a competing corporation anywhere within 250 miles of
West Virginia for a two-year period. Later, Voorhees left Guyan
and began working at Polydeck Corp., another West Virginia
manufacturer. The only product Polydeck made was urethane
screens, which comprised half of 1 percent of Guyan’s business.
Is Guyan entitled to enforce its noncompete clause?
4. 810 Associates owned a 42-story skyscraper in midtown
Manhattan. The building had a central station fire alarm system,
which was monitored by Holmes Protection. A fire broke out
and Holmes received the signal. But Holmes’s inexperienced
dispatcher misunderstood the signal and failed to summon the
fire department for about nine minutes, permitting tremendous
damage. 810 sued Holmes, which defended based on an
8. exculpatory clause that relieved Holmes of any liability caused
in any way. Holmes’s dispatcher was negligent. Does it matter
how negligent he was?
5. YOU BE THE JUDGE WRITING PROBLEM Oasis
Waterpark, located in Palm Springs, California, sought out
Hydrotech Systems, Inc., a New York corporation, to design and
construct a surfing pool. Hydrotech replied that it could design
the pool and sell all the necessary equipment to Oasis, but it
could not build the pool because it was not licensed in
California. Oasis insisted that Hydrotech do the construction
work because Hydrotech had unique expertise in these pools.
Oasis promised to arrange for a licensed California contractor to
“work with” Hydrotech on the construction; Oasis also assured
Hydrotech that it would pay the full contract price of $850,000,
regardless of any licensing issues. Hydrotech designed and
installed the pool as ordered. But Oasis failed to make the final
payment of $110,000. Hydrotech sued. Can Hydrotech sue for
either breach of contract or fraud (trickery)? Argument for
Oasis: The licensing law protects the public from incompetence
and dishonesty. The legislature made the section strict: no
license, no payment. If the court were to start picking and
choosing which unlicensed contractors could win a suit, it
would be inviting incompetent workers to endanger the public
and then come into court and try their luck. That is precisely the
danger the legislature seeks to avoid. Argument for Hydrotech:
This is not the kind of case the legislature was worried about.
Hydrotech has never solicited work in California. Hydrotech
went out of its way to avoid doing any contracting work,
informing Oasis that it was unlicensed in the state. Oasis
insisted on bringing Hydrotech into the state to do work. If
Oasis has its way, word will go out that any owner can get free
work done by hiring an unlicensed builder. Make any promises
you want, get the work done to your satisfaction, and then stiff
the contractor—you’ll never have to pay.
