Prepare a Memorandum of Law Directed to the Chief Operating Officer (Coo) of Giant That Discusses the Following Issues: Essay

1018 WordsNov 28, 20135 Pages
To: Giant Company President From: Chief Operating Officer (COO) of Giant Re: Review of Contracts Date: September 12, 2011 QUESTIONS PRESENTED My review of Giant’s contracts finding cost-saving actions using price as instructed and addressed to the Chief Operating Officer of Giant Candy Company (Giant) Giant respectfully. I. Can contracting parties Giant terminate Little Company’s (Little) contract? A promise that places no constraints on the promisor's freedom of choice is called an “illusory promise” and does not provide consideration for another party's promise. A. Is there a flaw in the consideration of the contract that would allow Giant to stop honoring the contract and allow it to buy from another vendor? II. Under agreed considerations on are current terms satisfactory to terminate agreement? A. Current price transaction looks like an arms-length bargain but one party's promise appears illusory, courts often will look to the context of the agreement and identify an implied non-illusory promise such that the consideration requirement is satisfied. 1. Letter to Little Buyer offer? rejection by entering into a substitute transaction, he is excused from performance obligations B. Determined by Little condition is not completely within the promisor's control C. Sufficient cause An agreement that gives one party an unfettered right to terminate at any time will be interpreted to require “reasonable notice,” thus placing a limitation on that party's freedom sufficient to satisfy the consideration requirement 1. Certain terms (open) buyer is constrained to request amounts that are not unreasonably disproportional there is clearly consideration for the modification and it is enforceable the modern rule, an offer for a unilateral contract becomes an option for the offeree 2.

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