Business Law Problems

1.What are the four elements of a valid contract?A contract is an “agreement between parties, with terms and conditions that describe the agreement that constitutes a legal obligation” (All Business). A valid contract requires four elements and these are:

a.Mutual agreement – there must be a meeting of the minds between parties. There should be an offer and an acceptance. There should be an agreement to enter into the contract b.Consideration – meaning that “every party is conferring a benefit on the other party or himself sustaining a recognizable detriment, such as a reduction of the party’s alternative courses of action where the party would otherwise be free to act with respect to the subject matter without any limitation” (Wikipedia). This simply means that there should be something given and something received.

c.Legality – The good or service being exchanged must be legald.Capacity – both parties should be legally competent to enter into the agreement. 2.Describe the objective theory of contracts. How does that theory apply to this case?

In layman’s term, the objective theory of contracts simply means that “we look at whether a reasonable person to whom the statement was address would believe it to be an offer” (Lloyd). In the case of PepsiCo’s advertisement and Leonard suit, it is obvious that there is no contract on the basis of the objective theory. As the judge ruled “an objective reasonable person would not have considered the commercial an offer” (John D.R. Leonard vs. PepsiCo). The commercial was supposed to be humorous and an objective person would look at it that way and not really an offer just like Leonard assumed it was. 3.Why do you think the court held that there was not a valid agreement here?

The court held that that there is no valid agreement here because the commercial was evidently was made in jest. Also if we look at one of the four elements of a valid contract, there is no mutual agreement between PepsiCo and the plaintiff. Also, is it a “deal too good to be true” since a fighter jet plane cost $23 million while the 7,000,000 points would onlycost $700,000. Clearly 4.Are advertisements generally considered offers? Why or Why not?

According to the case, advertisements are not offers because the Restatement of Contracts state that “Advertisement of goods display, sign, handbill, newspaper, radio, or television are not ordinarily intended or understood as offers to sell….but there must ordinarily be some language of commitment or some invitation to take action without further communication”. Advertisements are usually regarded as requests to reflect on them whether the viewer will be enticed to buy the product. 5.How does this case differ from a reward situation, where a unilateral contract is formed upon completion of the requested act?

A reward offer is usually a unilateral contract. “The offeror (the party offering the reward) cannot impel anyone to fulfill the reward offer. An offeree can sue for breach of contract, however, if the offeror does not provide the reward after the offeree has fulfilled the contract’s requirements.” (Wikipedia). In advertisements offering rewards, a person would have to perform the conditions named in the advertisement, and anybody who does perform the condition accepts the offer.

Selling Bigtown on EBay might have the same repercussion as the case of the PepsiCo and Leonard. There might really be someone like Leonard who will take the auction seriously and a legal fight might arise from the suit. The effort of the Mayor to boost Bigtown’s tourism would backfire when Bigtown becomes embroiled in litigation such as the case of PepsiCo versus Leonard. Bad publicity will definitely result in the tails of the legal proceedings which would negatively impact Bigtown. Is this what the mayor wants? For Bigtown to become an object of ridicule? Tourists will probably go to Bigtown, not because of what Bigtown can offer for them but for the curiosity. Instead of tourism, unconstructive backlash against the whole town might happen. Assignment Name:Unit 3 Discussion Board

1.What will be the long-term impact of electronic contracting on the nation’s business?E-commerce has infiltrated our lives that we now consider transacting online or in the internet as a normal thing. E-commerce is the “process of managing online financial transactions by individuals and companies” (Petrova) and part of e-commerce would be electronic contracting. Electronic contracts are contracts consummated electronically which should have the same purpose and validity as that of the ordinary contracts on business will be huge as e-commerce have grown staggeringly in the past decade. According to the report e-commerce will reached to trillions in the years to come. As such, electronic contracting will probably replace traditional contracts. This is because electronic contracting facilitates negotiation, saves time and resources since everything is done via the internet or electronically.

Of course, the transaction and the contract should still be examined thoroughly by a legal counsel. Another impact electronic contracting would have to business is the expansion of business market to the global economy. The possibility of doing business around the world electronically is a huge come on for any business. In the internet, transactions and negotiations can be done anytime in cyberspace. Markets are not limited to the local area where the physical office of the business is located. Therefore, market power would be greater as potential consumers and business partners are not limited by boundaries (Katz). Contracts can be drawn from the other side of the world and these can be perused easily, communication would be fast and negotiations would be faster.

Cost of contracting will be lower which will definitely impact businesses. Another impact of electronic contracting is the impact on government regulations. With the advent of this new kind of contracting, governments would also have to update their regulations to adapt to electronic contracting. In order for electronic contracting to work, the necessary support and infrastructure should also be implemented. There should be firmer and specific laws to regulate these kinds of transactions. 2.What are the potential pitfalls you see with electronic contracting?

One major pitfall of electronic contracting is the potential legal impact that can ensure from such negotiation. Currently, not all states have an electronic contracting law. As such, these contracts may not be recognized by everybody. Also, the “admissibility of evidence of an electronic record or signature may be unconstitutional; contracting parties should consider adding clauses expressly providing for the admissibility of the constituent electronic records” (Reid & Priest). Another pitfall that could ensure from electronic contracting is the huge possibility of fraud and mistake which is minimized in traditional contracts. Also, ecommerce information has the potential of being used improperly. Assignment Name:Unit 4 Discussion Board

1.Is the International Court of Justice the first world court?The International Court of Justice is by no means the first world court. Evidences of international arbitration dates back to the Jay Treaty of 1794 between the United States and Great Britain which is called the Treaty of Amity, Commerce and Navigation “provided fro the creation of three mixed missions, composed of American and British Nationals in equal numbers, whose task it would be to settle a number of outstanding questions between the two countries which it had not been possible to resolve by negotiation” (Columbia Electronic Encyclopedia).

This is followed by the Alabama Claims also between the US and the UK in 1872 and then under the Treaty of Washington. In 1989, the Permanent Court of Arbitration was founded after the Hague Peace Conference whose main objective is to discuss peace and disarmament.

This consisted of “panel of jurists designated by each country acceding to the Convention – each such country being entitled to designate up to four – from among whom the members’ f the ach arbitral tribunal might be chosen (International Court of Justice Website). This court’s arbitral proceedings were revised in 1902 after the second Hague peace conference. The Permanent Court of International Justice was established by the League of Nations which is competent to “hear and determine any dispute of an international character submitted to it by the parties to the dispute or question referred to it by the council or the assembly” (International Court of Justice Website). The International Court of Justice was formally established in 1946 which is the judicial organ of the United Nations. 2.What are the procedures of the World Court? Are they similar to any US Court?

According to its website, the World Court proceedings are “defined in its Statute and in the Rules of Court”. The first phase of the procedures would be to have a written phase. This is where the both parties would “file and exchange pleadings”. Subsequently, an oral phase will ensure which will “consists of public hearings at which agents and counsel address the Court”. This is followed by oral proceedings where the Court will deliberate “in camera and deliver its judgment at a public sitting”.

The judgment is considered final and there will be no appeal. Just like the ICJ, a civil action in the US Courts starts with the filing of complaint where arbitration will be initially implemented. If the defendant answers the complaint, a pre-trail will follow where both parties will meet with a judicial officer “in an attempt to narrow the issues, determine the number of witnesses to be called, the length of the trial, and to discuss the possibility of settlement (US Courts Website). Afterwards, a court hearing will follow where the verdict will be handed down. An appeal may be filed after the lower court handed down its verdict. 3.What is an advisory opinion?

An advisory opinion is a “function of the court open only to specified United Nations bodies and agencies” (Wikipedia). When the ICJ received a request for an advisory opinion, it would decide which country or organization would be able to give useful information about the request and will ask them for written or oral statements. Advisory Opinions were “intended as a means by which UN agencies could seek the Court’s help in deciding complex legal issues that might fall under their respective mandates”. These opinions are just consultations but believed to be very influential in nature when given.

Assignment BUS255-0604B-13 Fundamentals of Business Law 1.Before the UCC and the UCITA, what was one of the first, and most significant, of the U.S. government’s attempts to promote uniformity in commercial laws from state to state? (Hint: think of “commerce” and Constitution). Prior to UCC and UCITA, the government uses the Law Merchant and the Negotiable Instrument Law.

The Law Merchant, or lex mercatoria, was “purportedly a system of law developed by medieval merchants to regulate commerce throughout the known world of Europe, North Africa, and Asia Minor” (University of Toronto Law Journal). UCC was a result of a late 19th century movement to have uniform state laws across the nation. They felt that the the United States Congress “does not have authority under the Constitution to legislate many issues reserving many powers to state governments. At the same time, there is a desire to have laws across the states that are as similar as practicable” (Wikipedia).

They also believed that the Commerce Clause in the Tenth Amendment of the Constitution is not sufficient to regulate commerce in all of the 50 states. The constitution’s commerce clause empowers the US Congress to “regulate Commerce with foreign Nations, and among the several States, and with the Indian Tribes” (Legal Information Institute). The National Conference of Commissioners on Uniform State Laws (NCCUSL) met in 1892 in Saratoga, New York to discuss a uniform commercial law but only seven states have representatives in the meeting. It was only in 1952 when the first draft of the UCC was developed. 2.Based on the information presented above, what do you see as the major differences between Article 2 of the Uniform Commercial Code and UCITA?

The major difference between Article 2 of the Uniform Commercial Code and UCITA is the coverage of sale of tangible goods. The “material transferred in a computer information transaction does not necessarily meet the definition of a “good” since information is not a tangible object but rather the product of someone’s mental processes that can be stored in a tangible medium” (Grier, et al, 2001). UCC might address goods in the industrial revolution but some technology goods sold in cyberspace are not physical goods which Article 2 is not specific on.

Another major difference is contract law and intellectual property law which cannot be accommodated in Article 2 of UCC because of its broad scope. The changing business law environment has prompted the revision of Article 2 of UCC and was incorporated into UCITA. Another difference is the extent transactions which include sale of goods and transfer or rights in information which is not covered in UCC. UCITA was developed to encompass any transaction which involves computer information, mixed transactions which involve computer information and other services and entire transactions whose primary matter is computer information.

3.What is the legal distinction between selling a product and licensing it? In transactions involving information, licensing means it is covered by copyright laws. It is licensed because it is a “creative work” rather than an actual “good”. Once the seller has “sold” the licensed information, he/she gives up the right to sell this to someone else (Hervey). As such, since the software or information is only “licensed” to somebody else, the creator retains legal ownership of the product and he/she can license it to as many people as she wants. 4.Many of the provisions in the UCITA were first proposed as a modification to Article 2 of the UCC. Why do you think the drafters decided to propose it as a separate and distinct uniform act?

As mentioned previously, the provisions and revisions that are needed in Article 2 was big in scope that the drafters abandoned and developed it as a separate code under the UCITA. Efforts to revise Article 2 of UCC evolved into a separate effort to “draft a computer information law to establish a new commercial law for the information industry – first at the national and then, through the influence of the United States, at global level” (ARL)

Bibliography

All Business. Legal Requirements for A Contract. Retrieved 25 October 2006 from http://www.allbusness.com ARL Website (1999). A Quick Look at the UCITA. Retrieved 25 October 2006 from www.arl.org Grier, R.L., Keane, N. & Gilbert P.A. (2001). Uniform Computer Information Transaction Act: Bringing Commercial Law into the 21st Century.

The Richmond Journal of Law and Technology Vol. VIII, Issue I Retrieved 25 October 2006 from http://www.richmond.edu/jolt/v8i1/article9.html Hervey. G. UCITA and Software Licensing. Retrieved 26 October 2006 from http://www.bregmanlaw.com/CM/Articles/Articles59.asp International Court of Justice. History. Retrieved 25 October 2006 from http://www.icj-cij.org/icjwww/igeneralinformation/ibbook/Bbookchapter1.HTM Katz, A.W. Is Electronic Contracting Different – Contract Law In the Information Age?

Retrieved 25 October 2006 from http://www.columbia.edu/ Legal Information Institute. United States Constitution. Retrieved 25 October 2006 from http://www.law.cornell.edu/constitution Lloyd, R.M (2003). Objective Theory of Contracts. Retrieved 25 October 2006 from http://www.law.utk.edu/ Petrova. R. (2002). The Impact of E-Commerce on the Global Economy. London: International Association for Official Statistics Reid T., Priest L.L.P. California is First State in Nation to Adopt

Electronic Contracting Law. Retrieved 25 October 2006 from http://www.constructionweblinks.com/Resources/Industry_Reports__Newsletters/Nov_18_1999/ The Columbia Electronic Encyclopedia. World Court on Fact Monster. Pearson Education, publishing as Fact Monster. Retrieved 25 Oct. 2006 from . Trakman, L.E. (2003) From the Medieval Law Merchant to the E-Merchant Law. Toronto: University of Toronto Law Journal. U.S. Court. Court Proceedings. Retrieved 25 October 2006 from http://www.uscourts.gov/ Wikipedia. Contracts. Received 25 October 2006 from www.wikipedia.org