Law 421 Week 4 Individual Assignment

Contract

When there is a valid contract between two parties, there must be an agreement on the offer, acceptance, and consideration. Chou and Big Time Toymaker (BTT), had a contract when BTT made a promise to pay Chou $25,000.00 for an exclusive negotiation rights for a 90-day period. The two parties agreed and three days before the 90 day expiration date, they also reached an oral distribution agreement during the meeting.

Objective Intent

Even without a final draft of a contract from the toymaker, BTT did express their intent to enter into a contract with its obligations when they agreed to and paid Chou the $25,000.00 for exclusive negotiation rights for 90 days. BTT showed objective intent to go forward by their actions on the offer (Melvin, 2011).

Also, BTT’s management continued on their intent when they sent Chou an email about the “Strat Deal” and included details about the terms to their distribution agreement. According to the Statues of Frauds, it states that there must be an agreement, in writing, to show evidence of terms in the prevention of fraud, which the two parties did have.

Email

Even though they communicated by email and without a formal contract after their initial meeting, there is proof of existing terms that makes the agreement valid. Under the UETA (Uniform Electronic Transactions Act), the laws are applicable to electronic transactions such as emails as long as both parties to the contract agree to the use of electronic commerce.

Chou and BTT communicated by emails and other electronic communication device such as fax to request drafts of the distribution agreement contract. “The UETA gives formal legal recognition of electronic records, signatures, and contracts by providing that if a law requires a record to be in writing, an electronic record satisfies the law” (Melvin, 2011, p129).

Statute of Fraud

The statues of frauds did not play any role in this contract since this agreement does not involve any sale of land or goods other than the distribution rights for the “Strat” game. The distribution rights in this agreement between BTT and Chou does not fall into any categories of this statute.

Doctrine of Mistake

To avoid or to cancel the contract under the “doctrine of mistake”, it needs the two parties (BTT & Chou) to have held erroneous beliefs on their agreement. BTT did state that “the negotiation agreement stipulated that no distribution contract existed unless in writing” (Melvin, 2011, p.155). BTT will probably