Business Law assignment

I am soooooo lost! ANY ADVICE??????

The Sales Transaction. On January 15, 2007, Mark Bennett, a Zenox sales representative, receives a telephone call from Holly Adams, the Vice President of Purchasing of Edgy Electronics, Inc. ("Edgy"). Edgy, a New York corporation, operates several retail stores in Western New York and sells various types of electronic equipment, including televisions. Over the telephone, Holly tells Mark that Edgy is interested in purchasing 50 flat screen televisions (25 of which are to have a 30 inch screen and 25 of which are to have a 50 inch screen) from Zenox if the price is right. Mark tells Holly that Zenox will sell Edgy 25 of its 30 inch flat screen televisions for $1,250 each and 25 of its 50 inch flat screen televisions for $2,500 each. Holly orally agrees to the deal, and Mark tells her that he will send her Zenox's standard written confirmation form right away.



Later that day, Mark faxes the following to Holly's attention at Edgy:


To: Edgy Electronics, Inc. ("Buyer") January 15, 2007
Attn: Holly Adams

Confirmation of Sale

As per our telephone conference today, this will confirm that Zenox Inc. has offered to sell, and Edgy Electronics, Inc. has agreed to purchase, the following from Zenox Inc.:
1. 25 Zenox 30 inch flat screen TVs at $1,250 each
2. 25 Zenox 50 inch flat screen TVs at $2,500 each

Zenox Inc.("Seller")
By, Mark Bennett, Sales Representative


Mark's fax to Holly also includes another page entitled "Terms of Sale" which states, in pertinent part, as follows:


1. All merchandise described in this Confirmation of Sale will be delivered to Buyer within 60 days of the date hereof. Buyer may cancel only if the merchandise is not delivered within such 60-day period. Such cancellation shall be made only by written notice delivered to Seller via certified mail, return receipt requested.

2. Payment for all merchandise described in this Confirmation of Sale shall be received by Seller within 10 days of the date of delivery. Payments received after such 10-day period shall be subject to an interest charge of 1% for each month or portion thereof for which payment is received late.

3. This Confirmation of Sale (including these Terms of Sale) represents the entire agreement between Buyer and Seller, notwithstanding any written statement received from Buyer. Such agreement cannot be modified except in a writing signed by an authorized representative of Seller.


Holly receives Mark's fax on January 15, 2007 and does not object to it. On
January 30, 2007, Holly faxes an Edgy purchase order form to Mark's attention at Zenox, which states as follows:









Purchase Order
To: Zenox Inc. ("Seller") January 30, 2007
Attn: Mark Bennett

Re: Your Confirmation of Sale dated 1/15/2007

The undersigned Buyer hereby accepts Seller's offer to sell as set forth in Seller's Confirmation of Sale dated 1/15/2007. Accordingly, Buyer shall purchase and Seller shall sell the following:
1. 10 Zenox grey 30 inch flat screen TVs at $1,250 each
2. 15 Zenox black 30 inch flat screen TVs at $1,250 each
3. 10 Zenox white 50 inch flat screen TVs at $2,500 each
4. 15 Zenox black 50 inch flat screen TVs at $2,500 each

Edgy Electronics, Inc.("Buyer")
By Holly Adams, VP of Purchasing

Holly's fax to Mark also includes another page entitled "Terms of Purchase" which states, in pertinent part, as follows:

1. All merchandise ordered pursuant to this Purchase Order shall be delivered to Buyer within 30 days of the date hereof. Buyer may cancel the order if the merchandise is not delivered within such 30-day period. Such cancellation shall be made by written notice to Seller sent via fax, email or certified mail.

2. Any dispute arising with respect to this transaction shall be resolved by arbitration to be conducted in Buffalo, NY in accordance with the rules of the American Arbitration Association.

Mark receives Holly's fax on January 30, 2007, and does not reply to it.

On February 5, 2007, Mark faxes a letter to Holly's attention at Edgy. The letter states that Zenox must increase the price of each TV by $100 due to the imposition of a new federal excise tax (enacted as a last minute, emergency amendment to a Federal tax bill on February 2, 2007). The new tax requires manufacturers of televisions sold within the United States to pay an excise tax of $100 for each 30 inch or larger screen television delivered within the U.S. after February 3, 2007. Holly receives but does not reply to Mark's letter. Shift in market is a good faith reason for contract modification

On February 15, 2007, Edgy receives a delivery of 25 black 30 inch flat screen televisions from Zenox. Included with the delivery is an invoice for the 25 televisions at $1,350 each (for a total of $33,750). The invoice indicates that the 50 inch flat screen televisions will be sent separately.

On February 16, 2007, Holly faxes a notice to Mark's attention at Zenox. The notice states, in pertinent part, that Edgy "hereby rejects delivery of 10 of the 25 televisions received on February 15, 2007, because 10 of the 30 inch televisions were supposed to be grey."

On March 5, 2007, Zenox receives a check from Edgy for the amount of $18,750. The check notes that it is in payment for 15 Zenox black 30 inch flat screen televisions at $1,250 each. Should have been 1350

On March 7, 2007, just as Zenox is preparing to ship 10 white and 15 black Zenox 50 inch flat screen televisions to Edgy, Mark receives another faxed notice from Holly, which states as follows:

To: Zenox Inc. March 7, 2007
Attn: Mark Bennett

Re: Cancellation of Remainder of Purchase Order dated 1/30/2007

Edgy Electronics, Inc. hereby cancels the remainder of the above-referenced Purchase Order for the following:

10 Zenox grey 30 inch flat screen TVs, 10 Zenox white 50 inch flat screen TVs, and
15 Zenox black 50 inch flat screen TVs.

Reason for cancellation – failure to supply merchandise within 30 days of Purchase Order and attempt to increase price

Edgy Electronics, Inc.
By Holly Adams, VP of Purchasing

Greetings!

The most important thing to remember when answering a law question or exam like this is to state what the rule of law is, then tell how the law applies to the facts of the case at hand.

For example, ordinarily, contracts for the sale of goods over $500 must be in writing to be enforceable (under the Statute of Frauds), but there is an exception when the contract is between merchants. Between merchants, a written confirmation that is sufficient against the sender is also sufficient against the recipient unless the recipient gives written notice of his objection within ten days. So, you would discuss Holly's failure to object within ten days to the written confirmation sent by Mark. Holly attempted to change the terms of the contract by adding additional terms.

Don't get overwhelmed by all the "facts" of the case. Just go through the actions of both parties, discuss the applicable rules of contract law that you have learned in class, and apply them to each party's actions. It is more important to discuss all the issues than it is to arrive at one definitive "right" answer -- at least, that's how most business law tests are designed.

I hope this helps!

Thanks,

Sarah, EssayForum.com

When holly added the additional terms, under sales law no consideration is needed. However, Max included a terms of sale stipulating no changes could be made unless in a signed writing by seller. But, Max did no object to the terms set forth by Holly and doesn't that mean he accepts them.

Thank you sooo much for your fast feedback!!!!!!!!!!!!!!!!!!

Greetings!

It has been a while since I learned this and I'd hate to steer you in the wrong direction, so please try to confirm what I'm going to tell you with your business law text or some other source. If a party accepts an offer but in the process of accepting changes material terms of the offer, the acceptance may be considered a counteroffer; no contract is formed until the original offeror accepts the counteroffer and consideration is exchanged. In contracts between merchants, additional or different terms by the offeree become part of the contract unless (1) the offer expressly limited acceptance to the terms of the offer; (2) the new terms materially alter the contract; or (3) the offeror objects within a reasonable time. It could be argued that Holly's additional terms materially altered the contract -- a contract which limited acceptance to the terms of the offer (Mark's offer). It looks to me like Holly is the one in breach.

Best of luck in your studies!

Thanks,

Sarah, EssayForum.com

You are amazing! If you are ever in NYC i will buy you a drink! Thank you so much!

You're welcome! (I hear they make a pretty awesome "tea" on Long Island ;-))

Sarah