ADMS 2610 Lecture Notes - Lecture 5: Dalhousie University, Documenta, Bigram

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silverwallaby916

30 Sep 2015

School

York University

Department

Administrative Studies

Course

ADMS 2610

Professor

Richard Gasparini

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Document Summary

A contract under seal does not require consideration for historical reasons. The act of sealing the agreement was indicative of the person"s intention to be bound by the promise made after giving the matter considerable thought. This type of contract derives its validity from its form rather than from the presence of consideration: consideration may be present or future. Present consideration would involve an immediate act (giving a person goods in return for a promise of payment). The promise is considered to be gratuitous at common law because the promisor receives nothing in return for the promise. There is no consideration given for the promise to forego the balance owing. See question 10 for exceptions: explain promissory estoppel. Promissory estoppel may arise where a person states a material statement of fact as being true, and another relies upon the statement to his or her detriment. If the person making the untrue statement brings a claim against the other.

Related Questions

1. The Winklers were interested in purchasing a home in the Valleyview Farms housing development. They contracted the developer, Galehouse, and selected a lot that cost $57,000. They asked the developer to show them plans for houses for which the construction costs would range from $1800,000 to 190,000, indicating that this was the price they would be willing to spend on construction only and wasnât to include the lot price. The developer gave them several books and plans to look at. After the Winklers had several conversations with Galehouse, he drafted plans for a house and gave the Winklers a quote of $198,000 for the construction costs. The lot price was not included. After several weeks of negotiations, the parties agreed on a price of $291,000 for both the construction costs and the lot. Galehouse prepared a written contract to reflect the agreement of the parties, but he forgot to include the lot price. The final contract read âprice for $198,000.â The Winklers paid Galehouse $57,000, the lot price, as a down payment. When the construction was completed, and the Winklers were finalizing their loan from the bank, the parties discovered the error in the contract. The Winklerâs argued that the written contract indicated total costs of $198,000, and that is the total amount they should pay. Galehouse sued to have the contract reformed to reflect the full agreed upon price of $291,000. Should the contract be reformed? Why or why not? Fully explain your answer. 2. The Laths were the owners of a farm that they wished to sell. Mrs. Mitchell considered purchasing the land but found that a barn located across the road was objectionable. Mitchell argued that the Laths orally agreed to remove the barn in consideration of her promise to purchase the property, which she agreed to do for $8,400 in a written contract. The contract made no mention of the removal of the barn. After Mitchell moved into her new home and made several improvements to the land, the Laths never removed the barn and expressly communicated that they had no intentions of removing the barn. Mitchell sued the Laths for breach of contract. In whose favor do you think the court ruled? What effect does the parol evidence rule have on admissibility of oral agreements regarding the promise to remove the barn? Fully explain your answer. 3. Shirley and Vince Ladner leased 10 acres of their land to J.D. Pigg, who used the land for his cattle farm. The Landers and Pigg created a 10-year contract, providing that rent be paid annually on August 1. Pigg excuted the lease with his first payment of cash in August 2000. On August 1, 2001, Mrs. Pigg attempted to mail the check for the second rent payment but placed the wrong mailing address on the envelope. Consequently, the check was returned to her residence. Mrs. Pigg then properly forwarded the check to the Ladners. However, the Ladners did not receive the check until August 8, 2001, at which time they refused to accept the payment and returned the check to Pigg. The Ladners claimed that the lease had been terminated by Piggâs failure to submit payment in a timely manner, and this failure constituted a material breach of contract. Is Piggâs failure to tender payment on August 1 a material breach of the lease? Why or why not. Fully explain your answer.

rubygoose336

B offered to sell a boat to C for $35,000. Câs response statedâI accept your offer but I will also need the boat moved to my boatslip at the same marina.â Is there a contract? If so what are theterms? Explain.

4. Perfect Poultry Company offers to sell a specified number ofchickens and turkeys to Quick Markets. Without including anyadditional terms in the proposal it is a valid offer to form acontract? Explain.

5. Daveâs uncle tells Dave that if âhe feels thatDave deserves it,â he will give Dave $10,000 when Dave graduatesfrom college. Dave agrees to the deal. Is the uncleâs promiseenforceable if Dave graduates? Explain.

6. Jennifer was about to be struck by a speeding car. Eva pushedher out of the carâs path, just in time to save her from beingstruck. However, Eva was herself struck by the car and wasseriously injured. Several weeks later, Jennifer promised Eva thatshe would pay her $1,000 per month for life. Is Jenniferâs promiseenforceable? Explain.

7. Vincent entered into a contract to sell his laptop to Millie,age 17. Millie took possession of the computer and continued to useit for five months after reaching her 18^th birthday. Howsignificant is her continued use of the computer?

8. Baker, a real estate broker, only licensed in Oregon,concluded a land sale in California. If the California clientrefuses to pay Baker the commission on the sale may he successfullysue the client for breach of contract? Explain.

9. DG Corp. has recently created a genetically modified cow,which they named Elsie. The MJ Dairy Co. contacts DG about buyingElsie. On November 1st, DG and MJ sign a contract stating that DGwill sell Elsie to MJ for $50,000. What neither party knows is thatElsie died during the preceding night. Explain the significance ofthat event.

10. Gene sells a trail bike to Hollis without disclosing thatthe odomeÂter, which reads 10,000 miles, was disconnected 90,000miles ago. Does Hollis have to pay the contract price? Discuss.

11. Mona is induced by her guardian Newt to sign acontract to invest her student loan funds in Overseas Bank throughNewtâs investment firm. Unknown to Mona, Newt realizes ongoingcommissions from the investment. On what basis could Mona rescindthe contract? Discuss.

12. Carl leases 2 acres of land to his friend, Larry. Larryintends to build a house on the property which will significantlyincrease its value. Larry applies for a $1 million loan from FleetBank to build the house. Carl orally promises the bank that he willbe responsible for paying back the loan if Larry does not. On thatbasis the loan is approved.

Is Carlâs promise enforceable if Larry fails to pay back theloan? Explain.

13. Guardian Security, Inc., and Hedge Fund Corporation enterinto an oral contract under which Guardian Security agrees toprovide security services for Hedge Fund offices for as long asHedge Fund needs them. This contract is/is not enforceÂ¬able?

14. The Caplans contract with Fain Construction tobuild a house on their lot for $300.000. The written contractspecifies that Fain is to satisfactorily install Crane brandbathroom fixtures. Fain completes construction but the Caplansrefuse to pay the full contract price because they are notsatisfied with the bathroom fixtures installations. Discuss whetherFain is or is not entitled to the full contract price.

15. Polly agrees to buy Quinnâs Cycle World but only ifRidgeline Credit Union approves the financing. This approval isa:

a. Condition precedent.

b. Condition subsequent.

c. An illusory promise.

16. Edâs Electric substantially performs its contract withForest Hills Apartments, Inc., to deliver and install an alarmsystem and parking lot lighting. Edâs is entitled to

a. Nothing due to the breach of contract.

b. Payment to the extent that it performed the contract.

c. Full payment of the contract price since it did substantiallyperform.

17. Gliding Light, LLC, and Hang Gliders, Inc., are parties to acontract. They subseÂquently agree that High Riders Inc. shouldtake Gliding Lightâs place and assume all of its rights and dutiesunder the contract. This is:

a. A mutual agreement to rescind.

b. An accord and satisfaction.

c. A novation.

d. A settlement agreement.

18. Omar and Penn want to discharge their contract by executinga new agreement with performance by Penn to be different from whatwas originally promised. This can best be accomplished by:

a. A mutual agreement to rescind.

b. An accord and satisfaction.

c. A novation.

19. Nina contracts with Office Suites Corporation to buy a suitein its Prospect Point Tower at a premium because of its undisturbedview of Quay Harbor. Unforeseeably, the town of Quay Harbor changesthe zoning law, and Resort Hotels, Inc., constructs Seaview Resort,blocking what would have been Ninaâs view. Ninaâs best argument fora change in the Office Suites contract or its price is:

a. Frustration of purpose.

b. Objective impossibility of performance.

c. Anticipatory repudiation.

d. Commercial impracticability.

erinhyena731

CASE STUDY
DIVESTITURE IMPLEMENTATION COMMITTEE (DIC) PROJECT
The Divestiture Process
a. Listing of SOEs to be divested
The Government of Ghana provides the Divestiture Implementation Committee (DIC) with a list of enterprises slated for divestiture. DIC opens a file for each such company. All documentation and correspondence prepared or received in
2
connection with the enterprise is placed on this file.
Enterprises listed for divestiture are categorized by the Ministry of Finance (principally on the basis of employee numbers) into small, medium, and large. In most cases, the divestiture of large and medium enterprises is outsourced to consultants. Small enterprises are either outsourced, or divested by DIC.
b. Advertisements
Bid documents are prepared for the particular State Owned Enterprise (SOE), and the SOE is advertised for sale. Adverts should appear in at least 2 leading Ghanaian newspapers each week for 3 consecutive weeks. Adverts may also appear in foreign publications.
c. Bidding
i. Obtaining bid documents
Investors interested in a particular SOE contact the secretariat, and after filling in an application form, paying a non-refundable bid fee (¢1,000 for local investors, and $400 for foreign investors), and signing a confidentiality undertaking, they are provided with the relevant bid documents.
The bid document is made up of
• bid procedures;
• a draft sale and purchase agreement;
• a memorandum containing the profile of the SOE;
• an independent valuation report (¢ 1,000 for local investors, and $300 for foreigners);
• fixed assets valuation report (where sale of assets is the mode of divestiture);
• share valuation report (where sale of shares is the mode of divestiture).
ii. Form of bids
Investors bids should comprise of a qualification statement made up of
1. Details about the bidder, including (as relevant):
a. the bidder's full name, address and contact details;
b. details of the bidder's directors and shareholders;
c. details of the bidder's existing business;
d. financial periods; and
2. The bidder's business plan for the enterprise, including, by way of example:
3
a. plans for the development of the enterprise (with regard to both its rehabilitation and, as relevant, down-sizing of expansion) and the timing of the implementation of those plan;
b. intentions with regard to employment, proposed staff training programmes and proposals for staff participation in the enterprise;
c. marketing approach and initiatives proposed for the enterprise, including export prospects and anticipated opportunities to expand beyond traditional or existing markets;
d. impact on the local community (particularly where the enterprise has traditionally provided social services and/or infrastructure);
e. impact on competition and the regulatory environment; and
f. environment impact;
3. Confirmation that the offer for the assets or, as the case may be, shares of the
enterprise is not subject to any conditions;
a. any important points of principles arising from the draft sale and purchase agreement; and
b. confirmation that the bidder will comply with the bid procedures.
c. The bid procedures must state the requisite contents of the business plan as specifically and clearly as is possible in the circumstances. The details mentioned in 3 above will not be applicable to all enterprises.
4. A price bid.
a. the price offered for the assets or, as the case may be, shares of the enterprise (clearly indicating the proposed currency of payment);
b. if the offer is not on the basis of cash in full on completion, the precise timing of any deferred payments;
c. in the event of deferred payments, details of the security proposed to be given;
d. a detailed explanation of how the bidder intends to finance the acquisition. In the case of an offer made from existing resources, the bidder will be expected to provide written confirmation from its bank or financial adviser that the necessary funds will be available.
In the case of an offer not made from existing resources, the bidder will be expected to provide written confirmation from its arrangers or providers of finance that arrangements have been made, or will be made, to provide the necessary finance; and
5. Confirmation that the bidder has not done, and will not do, at any time any of
the following:
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a. communicated to a person other than DIC the amount or approximate amount of the price offered (other than in confidence to the bidder's advisers);
b. entered into any arrangement with any other person that he shall refrain from bidding or as to the amount of any price to be offered;
c. offered or agreed to pay or give, or paid or given, any valuable consideration directly or indirectly to any person for doing or having done, or causing or having caused to be done, any act or omission in relation to the price offered by the bidder or any other bid
.
iii. Evaluation of Bids
This is a two stage process:
• evaluation of qualification statements; and
• comparison of price bids.
DIC opens price bids from only bidders whose qualification statements DIC accepts. In the event of equal price bids, preference is given to Ghanaians.
iv. Rejection of bids :
Bids will be rejected on the following grounds:
• received after closing date and time;
• appropriate fee not paid;
• received from person who canvassed DIC member; and
• received from SOE or a body allied to an SOE.
Exceptions under which bids may be accepted include where the assets concerned comprise non-industrial land and buildings, with no on-going business, and the bidding SOE requires additional office accommodation.
d. Negotiations
DIC will write to the winning bidder, and each other bidder, to inform them of the results of the bid.
Negotiations will then start with the winning bidder. Should he fail to satisfy DIC demands, the next highest conforming bidder will be invited to negotiate.
e. Approvals
After DIC Secretariat has agreed the terms of the sale with the winning bidder, the divestiture will be considered by the DIC members.
DIC members, if they are satisfied with the sale, will submit a letter of
5
recommendation to the President's Office for approval.
If either DIC or the President's Office raises concerns concerning the bid, a letter is sent to the bidder and further negotiations may take place.
If the President's Office grants the approval, DIC will send a letter to the bidder inviting him to sign the sale and purchase documentation. The Executive Secretary of DIC will sign on behalf of DIC and the government.
f. Payments
i. Mode of Finance
This could either be with
• investors own resource. or
• loan from a financial institution (DIC may take security over the asset until full payment is received).
In the case of instalments, for some loans, interest is paid on the diminishing balance.
ii. Terms of Payment
Payment could either be
• outright, or
• by instalments.
iii. Payment timing
• payment of less than 50% of the price offered; or
• deferred payment due 3 years after completion.
DIC prefers outright payment, but will consider deferred payment. Deferred considerations should be secured by a guarantee from a bank or other person of sufficient financial standing. If such guarantee is not available, DIC may consider taking security over the assets or, shares of the enterprise until full payment is received.
iv. Interest
Interest on deferred payments is as follows:
• Ghanaians: relevant Ghanaian Treasury Bill Rate
• Non Ghanaians: relevant London Interbank Offer Rate plus 2%.
v. Divestiture Proceeds
This will be paid to the appropriate DIC bank account.
The Proposed System
The Board of Directors of DIC has received funding from Government of Ghana
6
to commission the development of a robust and user-friendly web-based system that DIC will use for its operations.
REQUIRED:

1. Discuss the system development methodology that you would adopt for this project and justify your choice.
2. Construct data flow diagrams (including a context level diagram, a level 0 diagram, and several child diagrams) that show important, representative parts of the Divestiture Implementation Committee (DIC) System.
3. Identify five data files that will be used in the Divestiture Implementation Committee (DIC) System; and construct a comprehensive Data Dictionary for each of the five data files you have identified.
4. Construct use-case diagrams, sequence diagrams, and class diagrams for the proposed Divestiture Implementation Committee (DIC) System.
5. Construct object diagrams, activity diagrams and communication diagrams for the proposed Divestiture Implementation Committee (DIC) System.
6. Design five reports that should be generated from the Divestiture Implementation Committee (DIC) System.
7. Discuss the testing strategies/techniques that you would use on this project; and provide a table of test criteria and corresponding test data for the testing.

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ADMS 2610 Lecture Notes - Lecture 5: Dalhousie University, Documenta, Bigram

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