Week 1

Week 1 homework assignment

Chapter 9.4:

Winkel should receive the profit sharing according to the verbal agreement with Dr. Vranich. According to the Montana Law, a written contract can be altered only in writing or by an executed oral agreement. Winkel’s oral modifications were entered into with Dr.Vranich; therefore, the profit sharing should be received by Winkel due to the information and the laws of Montana.

Did Dr. Vranich act ethically in raising the defense that the contract was not in writing? No, Dr. Vranich raising the defense that the contract was not in writing is unethical. However, there was an oral contract agreement between Dr. Vranich and Winkel concerning an increase in salary and a profit-sharing bonus. There was one portion that was honored according to the oral contract where Winkel received the increased in salary as promised verbally by Dr. Vranich, but not the profit-sharing bonus.

Chapter 10.7

In the case of J.C. Durick Insurance v. Andrus, there was a previous agreement in place for insurance on the building. However, what is going on is the renewal of the new contract of insurance. Durick notified Andrus that his policy would be expiring in 2 months and that the building should be insured for 80% of the value of the building which came out to $48, 000, “as required by the insurance company”.

Andrus’s counteroffer states the following 2 conditions “1) he wanted insurance to match the amount of the outstanding mortgage on the building (i.e., $24,000) and (2) if Durick could not sell this insurance, he would go elsewhere.”

Since a counteroffer was made prior to the original contract offer expiration it was communicated back to Durick at that point he had an obligation to consider this new request and not simply ignore it. Derick’s action was to send the new insurance policy in an amount other than what Andrus had wanted.