Contracts Business Law Jan, a student at a university, places an ad in the student newspaper offering to sell her Toyota automobile. Robert, upon reading the ad, calls Jan and agrees to met Jan to examine the car. When Jan and Robert meet, Robert offers to purchase the car for $2,000. Jan informs Robert to go to his bank and get a cashiers check for that amount. An also informs Robert that upon his return, she will sell him the car. While Robert is at his bank, Jans friend John offers to purchase the car for $2,500.
John informs Jan that he has cash and is willing to purchase the car immediately. Jan accepts the $2,500 in cash and transfers the title to John. When Robert returns with the cashiers check, Jan informs Robert that she has already sold John the car. While John is driving he car, the car breaks down. John wants to return the car back to Jan and have Jan return the funds. Is Jan in breach of contract to Robert? Is John entitled to the funds paid to Jan? contract theory is the body of legal theory that addresses normative and conceptual questions in contract law. One of the most important questions in contract theory is why contracts are enforced.
One of the answer to this question focuses on the economic benefits of enforcing bargains. Another approach, associated with Charles Fried, says that the purpose of contract law is to enforce promises. The agreement between Jan and Robert can be characterized as an oral contract. Any contract that uses words, spoken or written, is a verbal contract. Thus, oral contract is a subset of a verbal contract. Most jurisdictions have rules of law or statutes which may render otherwise valid oral contracts unenforceable. Nearly every state has enacted a “Statute of Frauds”.
The Essay on The Social Contract Theory of John Locke
John Locke was born in Wrington , Somerset , England on August 29 1704 to John Locke and Agnes Keene , who were both Puritans (Uzgalis 2001 , Wikipedia 2006 , Microsoft Encarta 2006 . His father , after whom he was named , served as captain of cavalry for the Parliamentarian forces in the early part of the English Civil War . His family later moved to Pensford and Locke grew up in a rural Tudor ...
The Statute of Frauds requires that all agreements for the sale of goods over $ 500 (including vehicles) must be in writing. Therefore, purchasing a car for $ 2,000 in a jurisdiction requires a contract in writing to be enforceable. Before Robert went to the bank for the cashiers check, he and Jan had not sign any paper, which would bind Jan to sell the car to Robert for the agreed amount of money. Therefore Jan is not in breach of contract to Robert. Selling the car to John, who paid $ 2500 in cash, Jan transferred the title to him. One of the most common problems with a vehicle sale is buyer’s remorse. This happens the buyer feels he paid too much, or was not told about a problem with the car (just like in John’s case), or simply wishes he had purchased a different vehicle he saw the next day.
When this happens the buyer may try to cancel the deal. He may bring the car back, cancel his check to the seller, or even have an attorney write a letter demanding return of the purchase price. A Bill of Sale or Vehicle Purchase Agreement is a means against buyer’s remorse. When the buyer’s signature is on a written document setting forth all the terms of the deal (including warranty conditions and the description of the technical state of the vehicle), the buyer knows he is locked into the deal. If John and Jan did not sign neither a bill of sale, nor a Vehicle Purchase Agreement, John is not entitled to the funds paid to Jan..
