MCS 3040 Chapter 5: Law Chapter 5

• School: University of Guelph
• Department: Marketing and Consumer Studies
• Course: MCS 3040
• Professor: Joseph Radocchia

Document Summary

Legal factors in their business context: creating the. Communication: most contractual relationships begin with communication, informal contact between individuals who have common need, or general inquiries, communication is automatically laden with legal meaning, contract law concerns itself with what the negotiations say and do. Objective standard test: a test based on how a reasonable person would view the matter: contract law is governed by this. !1: therefore courts are normally not entitled to assess the fairness or reasonableness of the contractual terms the business parties have chosen. Economic reality: contract law exists to create legally binding commitments, but it might not be the best economic decision for party to keep that commitment, sometimes, price of compensation is acceptable to be released from the commitment. Reputation management: business that breaches contracts often due to bad planning or to pursue a better opportunity is likely to acquire a reputation for being an unreliable company.