Business Law - Vranich V. Winkel

1. Vranich v. Winkel

Dr. Loren Vranich ‘s company, Family Health Care, P.C. entered a written employment agreement with Dennis Winkel. The consideration was for annual salary, insurance benefits and other employment benefits. A few months later, an oral modification was made for a higher salary and a share of the profit. Winkel received the salary increase but not the profit sharing bonus.

Should Winkel receive the profit-sharing?

According to Cheeseman H.R. (2010), Winkel should receive the profit sharing because he believed that he entered a legally binding contract (a contract in which all elements are clearly stated i.e. offer, acceptance, consideration and lawful object.) with Dr. Vranich and acted according to the terms of the contract.

Did Dr. Vranich act ethically?

Under Montana law, a written contract can only be altered in writing or by an executed oral agreement. As stated in Stoddard v.Gookin (1981), an oral agreement altering a written agreement is not an executed oral agreement unless its terms have been fully performed and performance on one side is not sufficient. Dr. Vranich did not act ethically because he reneged on what was agreed upon with Winkel. However, he was right in stating that the contract was void because it was not altered by a written agreement.

2. Andrus v. Durick

Peter Andrus owned a building insured by J.C. Durick; a couple of months before the expiration of the policy, Andrus was notified by Durick that the building should be insured for 80% of the value of the building which came out to forty-eight thousand dollars ($48,000). Andrus made a counter offer with the condition that the insurance must match the amount of mortgage outstanding on the building in the amount of twenty-four thousand dollars. He emphasized that if terms were not met, he would go with another insurance company. Durick sent a new insurance policy for $48,000 with a condition that stated that the policy was automatically accepted unless he notified the company. Durick eventually sued Andrus for not paying the premium on the policy. Who wins?

For a contract to be established, there has to be a meeting of minds (i.e. an offer by one party and an acceptance by the other). In Cheeseman (2010), silence is not considered acceptance even if the offeror states that it is. This rule is intended to protect offerees from being legally bound to offers because they failed to respond. From the above definition, Andrus cannot be held liable for the unpaid premium owed to Durrick, because there was no contract.

3. Chuckrow v. Gough

Robert Chuckrow’s construction company was contracted to build a Kinney shoe store. Robert sub- contracted the carpentry work to Ralph Gough. Gough was responsible for all labor, materials, tools,