Business Finance Homework Help

Dewey, Cheatem & Howe travel agency (“DCH”), by its chief executive officer, A. S. Shyster (“ASS”), offered the Part-time Professors Association (“PP”) a one-week cruise leaving on June 15, 2015, on Ghoshit Cruise Line’s (“GS”) newly renovated, state of the art, cruise liner at a price of $1,000 per person for a maximum of 250 people. DCH, in the past, has sold many GS cruises and usually receives a 10% commission for each cruise sold. DCH made the offer to PP by telephone on May 1, 2015, and required PP to notify DCH in writing of its intention to accept the offer by May 15, 2015. As a condition to the offer’s acceptance, however, DCH demanded that PP purchase at least 150 cruises.

On May 14, 2015, PP’s executive vice-president, Ben Bungler (“Bungler”), tried to fax a letter to ASS stating that it was accepting DCH’s offer and guaranteed that at least 150 PP members would be attending. Unfortunately, Bungler couldn’t figure out how to put the new ink cartridge in the fax machine. Bungler then left his office and went to Molasses Mail (“M&M”) and paid to have PP’s acceptance letter delivered to DCH by overnight mail. However, while Bungler was at M&M, GS would not be able to honor the special promotional price they had promised to DCH. Immediately thereafter, ASS faxed a letter to Bungler informing him of the same.

M&M, however, did not deliver PP’s acceptance letter to DCH until May 16, 2015. Upon receiving PP’s acceptance, ASS immediately called PP and told Bungler’s assistant, Veronica “Verie” Witless, that the offer had been revoked on May 14, 2015. Verie Witless insisted that PP had already accepted DCH’s offer and demanded that they honor their promise. DCH offered to reschedule PP’s promotional deal for some time in September (after classes begin) or place them on one of GS’s older cruise liners, which was built in 1960 and has never been renovated. DCH, however, refused to refund any money or reduce the price.

On his way back from M&M, Bungler decided to go skiing at a shoddy-run ski lodge. After having been up most of the night beforey working on a new policy statement to deal with disruptive and annoying students (kind of like he used to be), Bungler was skiing down the mountain for the last time when he fell and suffered a compound fracture of his leg. Because he could not walk down the rest of the way, Sammy Schleper, who worked for Shoddy-Run ski patrol, used Shoddy-run’s new snowmobile to go up the mountain and rescue Bungler. Shoddy-Run had bought the snowmobile earlier that week directly from Safeco Snowmobiles (“SS”), which makes and sells several different types of snowmobiles. After safely getting Bungler, Schleper drove the snowmobile down the mountain. As Schleper reached the bottom of the mountain, he applied the brakes, which completely failed to operate. As a result, Schleper crashed into a tree, crushing his skull and instantly killing him. Bungler suffered a fractured skull that resulted in brain damage (no surprise there), two broken arms, a collapsed lung and multiple internal injuries requiring several major surgeries. Upon crashing into the tree, the tree snapped in half and fell on an electrical box containing the electrical circuitry that controlled the ski chairlifts. A spark from the electrical box started a fire spread to a nearby gas pipe creating a major explosion. The explosion sent pieces of wood and metal flying several hundred yards in the air onto the road in front of the Shoddy-Run lodge. Just as the explosion occurred, Bungler’s Uncle Lucky (UNL), who was driving away from Shoddy-Run and is easily distracted, noticed pieces of flying wood and metal, and failed to stop at the stop sign before turning on to the main road. Prof. Defensive Dave (DD), who was driving on the main road at fifty-five miles per hour, talking on his cell phone to an annoying student without a hands-free device and sipping hot coffee, crashed into Uncle Lucky. The speed limit on the main road is thirty-five miles per hour and there are no laws restricting the use of handheld cell phones or drinking coffee while driving. Uncle Lucky suffered severe head injuries leaving him in a coma for several months and permanently paralyzed from the waist down. Defensive Dave suffered numerous broken bones and a pinched nerve in his back but was still able to grade the final exams.

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Questions

1.Was a contact formed between DCH and PP and, if so, on what terms. If not, why?

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2.Assuming that a contract was formed on the stated terms, if each cruise sold is considered a “good” instead of a “service”, would the contract be enforceable? Why or why not?

3.Assume that a contract was formed on the stated terms, and that DCH breached. Would GS be liable to DCH for any damages and, if so, what and why?

4.Will Shoddy-Run be liable to Bungler for his injuries? Why or why not (include any relevant defenses)?

5.Will Defensive Dave be liable to Uncle Lucky for his injuries? Why or why not (include any relevant defenses)

6.Will Bungler have any liability to either his Uncle Lucky or Defensive Daves’s injuries? Why or why not?