Business Law-Contracts

Legal Memo

Re: Luke v. Robert

In the scenario provided, Luke and Robert have entered into a sales contract for goods. The transactions between them are typical of sales contracts – there are bound to be changes and the Uniform Commercial Code (UCC) provides for some flexibility among merchants when it comes to contract modification(s). In this memorandum, I will discuss the elements of a sales contract and the various offers and acceptances within this scenario. I will also note whether the Statute of Frauds applies. I will present several breaches, defenses and remedies in order to provide the best outcome for both parties. Lastly, I will discuss whether arbitration is required under the provisions of the contract.

ESTABLISHMENT OF THE CONTRACT

To establish a sales contract between the parties (Luke and Robert), the three elements of a contract must exist (offer, acceptance and consideration). In the scenario at hand, Luke and Robert have entered into a sales contract for goods (miniature novelty cats). Both Luke and Robert are merchants – Luke distributes wholesale novelty supplies and Robert sells them in his shop. Unlike common law, under the UCC, sales contracts can be entered into in any manner that shows agreement between the parties, including the actions of both parties which exhibits that a contract exists. Robert’s submission of the order and Luke’s return of the confirmation shows that both Robert and Luke intend to have a contract between them.

THE OFFER

The first offer was presented when Robert sent the written order for 3,000 novelty cats to Luke on May 1st.

Luke’s catalog could be considered to be an invitation to make an offer and not an offer in itself. In general, a catalog is a presentation of the goods being made available by the offeror and is considered to be a means to open communication between the parties in order to negotiate an offer. Catalogs cannot be contractually binding because, although...