Legal issue: New York Law.
1. Paul and Owen entered into a written contract pursuant to which Paul was to render painting services for Owen for a total price of $ 10,000. After the services had been performed, a good faith dispute arose between Paul and Owen over whether all of the services had been properly performed. Paul claimed that the full amount was due, but Owen argued that only $5,000 worth of services had been performed. After several weeks of argument, Owen sent a check for $6,000 to Paul on which Owen had written “payment in full for decorating services.”
(a) Paul endorsed (signed) the check, without making any further notations on it, deposited it and sued Owen for the remaining $4,000 he claims is due. Judgment for whom? Explain fully.
(b) Instead of the facts in (a) assume that Paul wrote “under protest” on the check when he endorsed it and, after depositing it, sues Owen for $4,000. What result? Explain fully.
(c) Instead of the facts in (a) and (b), assume the services were performed and that there was no dispute. Thereafter, Paul and Owen had a telephone conversation in which Paul agreed to take $6,000 in full satisfaction of Owen’s obligation under the contract. Owen then sends Paul a check for $6,000, with a letter referencing the telephone conversation. Paul endorses (signs) the check, deposits it, and then sues Owen for $4,000. What result? Explain fully.
2. On Feb. 1, 2019, Paula orally accepted an offer for a job as a professor at Brooklyn College for the Fall 2019 – Spring 2020 academic semesters. Meeting that day with Donna the Dean for hiring, they orally agreed that the employment would begin on September 1, 2019 and would finish on May 31, 2020 at a salary of $90,000 for that period.
On June 1, 2019 Paula came to NYC to look for an apartment. On June 2, 2020 she met with Lana, the landlord of a building on West 69th Street and orally agreed to rent a one-bedroom apartment for $2,500 per month starting on August 1, 2019 and ending on July 1, 2020.
On July 1, 2019, Paula received a phone call from Donna informing her that Brooklyn College would not honor the oral agreement it had reached with her.
On July 15, 2019 Paula received a phone call from Lana informing her that Lana would not honor the lease agreement they had reached with her.
(a) Paula sues Brooklyn College for breach of contract and Brooklyn College pleads the Statute of Frauds as a defense. Judgment for whom? Fully explain.
(b) Would your answer to (a) be different if, on June 1, 2019 Paula had written and signed a thank you note to Donna that read, “Thanks for agreeing to hire me as a professor for the Fall 2019-Spring 2020 academic semesters for $90,000 per year?” Fully explain.
(c) Would your answer to part (a) be different if Paula and Donna both owned private businesses and were both merchants? Fully explain.
(d) Paula sues Lana for breach of contract because she still wants to rent the apartment and Lana pleads the Statute of Frauds as an affirmative defense. Judgment for whom? Fully explain.
3. Betty decides to buy a used washing machine from Al, the owner of Al’s Appliances. Before the purchase, Al offers the used washing Machine to Betty for $250.00 and tells Betty,
1. The used washing machine Betty is interested in is “wonderful”.
2. Al also tells Betty, “This machine is worth $400 as it is in perfect working order”
3. Al also tells Betty that the prior owner of the washing machine was Beyonce.
Betty runs the machine once while at Al’s Appliances and it appears to work. Betty agrees to purchase the washing machine. Betty pays the $250 and takes the washing machine home.
Three days after buying the washing machine, Betty learns the following,
The used washing machine leaks about a gallon of water every third cycle and is probably only worth about $100. Al knew about this water leakage and was not been able to correct it. The second time Betty runs the washing machine at home, it leaks water all over the floor.
The prior owner was not Beyonce and it turns out Betty did not know who Beyonce is.
(a) May Betty rescind the contract? Explain the legal basis of your answer and discuss fully all three pieces of information numbered (1), (2) and (3) above.
(b) Would your answer to part (a) be the same if Betty, after learning of the leaking problem decides to put the machine in her basement that has a drain for the water to seep through and then two months later sues Al’s Appliances? Fully explain.