Question: Before their marriage, Linda and Gerald Heiden

> Sandra Ford signed a note and a mortgage on her home in Westwood, New Jersey, to borrow $403,750 from Argent Mortgage Co. Argent transferred the note and mortgage to Wells Fargo Bank, N.A., without indorsement. The following spring, Ford stopped making p

> Thomas Klutz obtained a franchise from Kahala Franchise Corp. to operate a Samurai Sam’s restaurant. Under their agreement, Klutz could transfer the franchise only if he obtained Kahala’s approval and paid a transfer fee. Without telling Kahala, Klutz so

> Abby Novel signed a handwritten note that read, “Glen Gallwitz 1-8-2002 loaned me $5,000 at 6 percent interest a total of $10,000.00.” The note did not state a time for repayment. Novel used the funds to manufacture and market a patented jewelry display

> Williams purchased a used car from Stein for $1,000. Williams paid for the car with a check (written in pencil) payable to Stein for $1,000. Stein, through careful erasures and alterations, changed the amount on the check to read $10,000 and negotiated t

> Muriel Evans writes the following note on the back of an envelope: “I, Muriel Evans, promise to pay Karen Marvin or bearer $100 on demand.” Is this a negotiable instrument? Discuss fully.

> Randal Schweiger bought a 2008 Kia Spectra EX from Kia Motors America, Inc., for his stepdaughter, April Kirichkow. The cost was $17,231, plus sales tax and other charges, and Schweiger financed the entire amount. April soon began having trouble starting

> Reefpoint Brewhouse in Racine, Wisconsin, contracted with Forman Awnings and Construction, LLC, for the fabrication and installation of an awning system over an outdoor seating area. After the system was complete, Reefpoint expressed concerns about the w

> Erb Poultry, Inc., is a distributor of fresh poultry products in Lima, Ohio. CEME, LLC, does business as Bank Shots, a restaurant in Trotwood, Ohio. CEME ordered chicken wings and “dippers” from Erb, which were delivered and for which CEME issued a check

> Bariven, S.A., agreed to buy 26,000 metric tons of powdered milk for $123.5 million from Absolute Trading Corp. to be delivered in shipments from China to Venezuela. After the first three shipments, China halted dairy exports due to the presence of melam

> Padma Paper Mills, Ltd., converts waste paper into usable paper. In 2007, Padma entered into a contract with Universal Exports, Inc., under which Universal Exports certified that it would ship white envelope cuttings to Padma in exchange for a payment of

> Alan Vitt purchased an iBook G4 laptop computer from Apple, Inc. Shortly after the one-year warranty expired, the laptop stopped working due to a weakness in the product manufacture. Vitt sued Apple, arguing that the laptop should have lasted “at least a

> Woodridge USA Properties, L.P., bought eighty-seven commercial truck trailers from Southeast Trailer Mart, Inc. (STM). Gerald McCarty, an independent sales agent who arranged the deal, showed Woodridge the documents of title. The documents did not indica

> Moore contracted in writing to sell her 2010 Hyundai Santa Fe to Hammer for $16,500. Moore agreed to deliver the car on Wednesday, and Hammer promised to pay the $16,500 on the following Friday. On Tuesday, Hammer informed Moore that he would not be buyi

> Genix, Inc., has contracted to sell Larson five hundred washing machines of a certain model at list price. Genix is to ship the goods on or before December 1. Genix produces one thousand washing machines of this model but has not yet prepared Larson’s sh

> Daniel Fox owned Fox & Lamberth Enterprises, Inc., a kitchen remodeling business. Fox leased a building from Carl Hussong. When Fox planned to close his business, Craftsmen Home Improvement, Inc., expressed an interest in buying his assets. Fox set a pri

> Allied Shelving and Equipment, Inc., sells and installs shelving systems. National Deli, LLC, contracted with Allied to provide and install a parallel rack system (a series of large shelves) in National’s warehouse. Both parties were dissatisfied with th

> Ethicon, Inc., a pharmaceutical company, entered into an agreement with UPS Supply Chain Solutions, Inc., to transport pharmaceuticals. The drivers were provided by International Management Services Co. under a contract with a UPS subsidiary, Worldwide D

> Kendall Gardner agreed to buy a specially built shaving mill from B&C Shavings. He planned to use the mill to produce wood shavings for poultry processors. B&C faxed an invoice to Gardner reflecting a purchase price of $86,200, with a 30 percent down pay

> Douglas Singletary bought a manufactured home from Andy’s Mobile Home and Land Sales. The contract stated that the buyer accepted the home “as is where is.” Singletary paid the full price, and his crew began to ready the home to relocate it to his proper

> B.S. International, Ltd. (BSI), makes costume jewelry. JMAM, LLC, is a wholesaler of costume jewelry. JMAM sent BSI a letter with the terms for orders, including the necessary procedure for obtaining credit for items that customers rejected. The letter s

> Kenzie Godfrey was a passenger in a taxi when it collided with a car driven by Dawn Altieri. Altieri had originally leased the car from G.E. Capital Auto Lease, Inc. By the time of the accident, she had bought it, but she had not fully paid for it or com

> Fallsview Glatt Kosher Caterers ran a business that provided travel packages, including food, entertainment, and lectures on religious subjects, to customers during the Passover holiday at a New York resort. Willie Rosenfeld verbally agreed to pay Fallsv

> Strike offers to sell Bailey one thousand shirts for a stated price. The offer declares that shipment will be made by Dependable Truck Line. Bailey replies, “I accept your offer for one thousand shirts at the price quoted. Delivery to be by Yellow Expres

> On December 21, 1988, Pan Am Flight 103 exploded 31,000 feet in the air over Lockerbie, Scotland, killing all 259 passengers and crew on board and 11 people on the ground. Among those killed was Roger Hurst, a U.S. citizen. An investigation determined th

> Holocaust survivors and the heirs of Holocaust victims filed a suit in a federal district court in the United States against the Hungarian national railway, the Hungarian national bank, and several private Hungarian banks, alleging that the defendants ha

> The Wind Tower Trade Coalition is an association of domestic manufacturers of utility-scale wind towers. The coalition filed a suit in the U.S. Court of International Trade against the U.S. Department of Commerce, challenging its decision to impose only

> In 1954, the government of Bolivia began expropriating land from Francisco Loza for public projects, including an international airport. The government directed the payment of compensation in exchange for at least some of his land. But the government nev

> Bell Helicopter Textron, Inc., designs, makes, and sells helicopters with distinctive and famous trade dress that identifies them as Bell aircraft. Bell also owns the helicopters’ design patents. Bell’s Model 206 Series includes the Jet Ranger. Thirty-si

> U.S. citizens who were descendants of victims of the Holocaust (the mass murder of 6 million Jews by the Nazis during World War II) in Europe filed a claim for breach of contract in the United States against an Italian insurance company, Assicurazioni Ge

> U.S. pineapple producers alleged that producers of canned pineapple from the Philippines were selling their canned pineapple in the United States for less than its fair market value (dumping). The Philippine producers also exported other products, such a

> Antex Industries, a Japanese firm, agreed to purchase 92,000 electronic integrated circuits from Electronic Arrays. The Swiss Credit Bank issued a letter of credit to cover the transaction. The letter of credit specified that the chips would be transport

> On a weekday, Tamara Cohen, a real estate broker, showed a townhouse owned by Ray and Harriet Mayer to Jessica Seinfeld, the wife of comedian Jerry Seinfeld. On the weekend, when Cohen was unavailable because her religious beliefs prevented her from work

> Mia Eriksson was a seventeen-year-old competitor in horseback-riding events. Her riding coach was Kristi Nunnink. Eriksson signed an agreement that released Nunnink from all liability except for damages caused by Nunnink’s “direct, willful and wanton neg

> Cuesport Properties, LLC, sold a condominium in Anne Arundel County, Maryland, to Critical Developments, LLC. As part of the sale, Cuesport agreed to build a wall between Critical Developments’ unit and an adjacent unit within thirty days of closing. If

> After submitting the high bid at a foreclosure sale, David Simard entered into a contract to purchase real property in Maryland for $192,000. Simard defaulted (failed to pay) on the contract, so a state court ordered the property to be resold at Simard’s

> Before buying a house, Dean and Donna Testa hired Ground Systems, Inc. (GSI), to inspect the sewage and water disposal system. GSI reported a split system with a watertight septic tank, a wastewater tank, a distribution box, and a leach field. The Testas

> Planned Pethood Plus, Inc. (PPP), a veterinary clinic, borrowed $389,000 from KeyBank. The term of the loan was ten years. A “prepayment penalty” clause provided a formula to add an amount to the balance due if PPP offered to repay its loan early. The ad

> Middleton Motors, Inc., a struggling Ford dealership in Wisconsin, sought managerial and financial assistance from Lindquist Ford, Inc., a successful Ford dealership in Iowa. While the two dealerships negotiated the terms for the services and a cash infu

> Lauren Barton, a single mother with three children, lived in Portland, Oregon. Cynthia VanHorn also lived in Oregon until she moved to New York City to open and operate an art gallery. VanHorn asked Barton to manage the gallery under a one-year contract

> Carnack contracts to sell his house and lot to Willard for $100,000. The terms of the contract call for Willard to make a deposit of 10 percent of the purchase price as a down payment. The terms further stipulate that if the buyer breaches the contract,

> Premier Building & Development, Inc., entered a listing agreement giving Sunset Gold Realty, LLC, the exclusive right to find a tenant for some commercial property. The terms of the listing agreement stated that it was binding on both parties and “their

> Dr. Jake Lambert signed an employment agreement with Baptist Health Services, Inc., to provide cardiothoracic-surgery services to Baptist Memorial Hospital–North Mississippi, Inc., in Oxford, Mississippi. Complaints about Lambert’s behavior arose almost

> Russ Wyant owned Humble Ranch in Perkins County, South Dakota. Edward Humble, whose parents had previously owned the ranch, was Wyant’s uncle. Humble held a two-year option to buy the ranch. The option included specific conditions. Once it was exercised,

> District in Bexar County, Texas, hired STR Constructors, Ltd., to renovate a middle school. STR subcontracted the tile work in the school’s kitchen to Newman Tile, Inc. (NTI). The project had already fallen behind schedule. As a result, STR allowed other

> David and Sandra Dess contracted with Sirva Relocation, LLC, to assist in selling their home. In their contract, the Desses agreed to disclose all information about the property—information on which Sirva “and other prospective buyers may rely in decidin

> Bath Iron Works (BIW) offered a job to Thomas Devine, contingent on Devine’s passing a drug test. The testing was conducted by NorDx, a subcontractor of Roche Biomedical Laboratories. When NorDx found that Devine’s urinalysis showed the presence of opiat

> Aron, a college student, signs a one-year lease agreement that runs from September 1 to August 31. The lease agreement specifies that the lease cannot be assigned without the landlord’s consent. In late May, Aron decides not to go to summer school and as

> Wilken owes Rivera $2,000. Howie promises Wilken that he will pay Rivera the $2,000 in return for Wilken’s promise to give Howie’s children guitar lessons. Is Rivera an intended beneficiary of the Howie-Wilken contract? Explain.

> On behalf of BRJM, LLC, Nicolas Kepple offered Howard Engelsen $210,000 for a parcel of land known as lot five on the north side of Barnes Road in Stonington, Connecticut. Engelsen’s company, Output Systems, Inc., owned the land. Engelsen had the lot sur

> Joy Pervis and Brenda Pauley worked together as talent agents in Georgia. When Pervis “discovered” actress Dakota Fanning, Pervis sent Fanning’s audition tape to Cindy Osbrink, a talent agent in California. Osbrink agreed to represent Fanning in Californ

> After twenty-nine years of marriage, Robert and Mary Lou Tuttle were divorced. They admitted in court that before they were married, they had signed a prenuptial agreement. They agreed that the agreement had stated that each would keep his or her own pro

> Rimma Vaks and her husband, Steven Mangano, executed a written contract with Denise Ryan and Ryan Auction Co. to auction their furnishings. The six-page contract provided a detailed summary of the parties’ agreement. It addressed the items to be auctione

> Newmark & Co. Real Estate, Inc., contacted 2615 East 17 Street Realty, LLC, to lease certain real property on behalf of a client. Newmark e-mailed the landlord a separate agreement for the payment of Newmark’s commission. The landlord e-mailed it back wi

> Charter One Bank owned a fifteen-story commercial building. A fire inspector told Charter that the building’s drinking-water and fire-suppression systems were linked, which violated building codes. Without disclosing this information, Charter sold the bu

> Gemma promises a local hardware store that she will pay for a lawn mower that her brother is purchasing on credit if the brother fails to pay the debt. Must this promise be in writing to be enforceable? Why or why not?

> Jerome is an elderly man who lives with his nephew, Philip. Jerome is totally dependent on Philip’s support. Philip tells Jerome that unless Jerome transfers a tract of land he owns to Philip for a price 30 percent below market value, Philip will no long

> Claudia Aceves borrowed $845,000 from U.S. Bank to buy a home. Less than two years into the loan, she could no longer afford the monthly payments. The bank notified her that it planned to foreclose on her home. (Foreclosure is a process that allows a le

> Citynet, LLC, established an employee incentive plan “to enable the Company to attract and retain experienced individuals.” The plan provided that a participant who left Citynet’s employment was entitled to “cash out” his or her entire vested balance. (W

> D.V.G. (a minor) was injured in a one-car auto accident in Hoover, Alabama. The vehicle was covered by an insurance policy issued by Nationwide Mutual Insurance Co. Stan Brobston, D.V.G.’s attorney, accepted Nationwide’s offer of $50,000 on D.V.G.’s beha

> On Brenda Sniezek’s first day of work for the Kansas City Chiefs Football Club, she signed a document that purported to compel arbitration of any disputes that she might have with the Chiefs. In the document, Sniezek agreed to comply at all times with an

> PEMS Co. International, Inc., agreed to find a buyer for Rupp Industries, Inc., for a commission of 2 percent of the purchase price, which was to be paid by the buyer. Using PEMS’s services, an investment group bought Rupp for $20 million and changed its

> Dorothy Drury suffered from dementia and chronic confusion. When she became unable to manage her own affairs, including decisions about medical and financial matters, her son Eddie arranged for her to move to an assisted living facility. During admission

> Geographic Expeditions, Inc. (GeoEx), which guided climbs up Mount Kilimanjaro, required climbers to sign a release to participate in an expedition. The form required any disputes to be submitted to arbitration in San Francisco and limited damages to the

> J.T., a minor, is a motocross competitor. At Monster Mountain MX Park, he signed a waiver of liability to “hold harmless the park for any loss due to negligence.” Riding around the Monster Mountain track, J.T. rode over a blind jump, became airborne, and

> Kalen is a seventeen-year-old minor who has just graduated from high school. He is attending a university two hundred miles from home and has contracted to rent an apartment near the university for one year at $500 per month. He is working at a convenien

> Dewayne Hubbert, Elden Craft, Chris Grout, and Rhonda Byington bought computers from Dell Corp. through its Web site. Before buying, Hubbert and the others configured their own computers. To make a purchase, each buyer completed forms on five Web pages.

> Technical Consumer Products, Inc. (TCP) makes and distributes energy-efficient lighting products. Emily Bahr was TCP’s district sales manager in Minnesota, North Dakota, and South Dakota when the company announced the details of a bonus plan. A district

> In what circumstances will an offer be irrevocable?

> What is the difference between express and implied contracts?

> What are the four basic elements necessary to the formation of a valid contract?

> How can business leaders encourage their companies to act ethically?

> What types of ethical issues might arise in the context of international business transactions?

> What laws protect authors’ rights in the works they create?

> What defenses can be raised to avoid liability for criminal acts?

> Name four defenses that can be used against an ordinary holder but are not effective against an HDC.

> How does the negotiation of order instruments differ from the negotiation of bearer instruments?

> What are the respective obligations of the parties under a contract for the sale or lease of goods?

> How do duty-based ethical standards differ from outcome-based ethical standards?

> What federal law allows U.S. citizens, as well as citizens of foreign nations, to file civil actions in U.S. courts for torts that were committed overseas?

> What are some clauses commonly included in international business contracts

> What is the act of state doctrine? In what circumstances is this doctrine applied?

> When do courts grant specific performance as a remedy?

> Under what circumstances is the remedy of rescission and restitution available?

> When is a breach considered material, and what effect does that have on the other party’s obligation to perform?

> How are most contracts discharged?

> What are the elements of fraudulent misrepresentation?

> In what types of situations might voluntary consent to a contract’s terms be lacking?

> What are the elements that are necessary for an effective acceptance?

> What is intellectual property?

> Rye signs corporate checks for Suchin Corporation. Rye writes a check payable to U-All Company, even though Suchin does not owe U-All anything. Rye signs the check, forges U-All’s indorsement, and cashes the check at Viceroy Bank, the drawee. Does Suchin

> Brite Images, Inc. (BI), agrees to sell Catalog Corporation (CC) five thousand posters of celebrities, to be delivered on May 1. On April 1, BI repudiates the contract. CC informs BI that it expects delivery. Can CC sue BI without waiting until May 1? Wh

> Country Fruit Stand orders eighty cases of peaches from Down Home Farms. Without stating a reason, Down Home untimely delivers thirty cases instead of eighty. Does Country have the right to reject the shipment? Explain.

> Café Rojo, Ltd., an Ecuadoran firm, agrees to sell coffee beans to Dark Roast Coffee Company, a U.S. firm. Dark Roast accepts the beans but refuses to pay. Café Rojo sues Dark Roast in an Ecuadoran court and is awarded damages, but Dark Roast’s assets ar

> Eagle Company contracts to build a house for Frank. The contract states that “any assignment of this contract renders the contract void.” After Eagle builds the house, but before Frank pays, Eagle assigns its right to payment to Good Credit Company. Can

> In September, Sharyn agrees to work for Totem Productions, Inc., at $500 a week for a year beginning January 1. In October, Sharyn is offered $600 a week for the same work by Umber Shows, Ltd. When Sharyn tells her boss at Totem about the other offer, he

> Fidelity Corporation offers to hire Ron to replace Monica, who has given Fidelity a month’s notice of her intent to leave the company. Fidelity gives Ron a week to decide whether to accept. Two days later, Monica decides not to leave and signs an employm

> Dyna tells Ed that she will pay him $1,000 to set fire to her store so that she can collect under a fire insurance policy. Ed sets fire to the store, but Dyna refuses to pay. Can Ed recover? Why or why not?

> Daisy takes her roommate’s credit card, intending to charge expenses that she incurs on a vacation. Her first stop is a gas station, where she uses the card to pay for gas. With respect to the gas station, has she committed a crime? If so, what is it?

> Sony revealed that the script for a new James Bond movie had been hacked and leaked. Could a news publication legally print or post online that entire script? Why or why not?

> Suppose that Coca-Cola had been trying to make the public believe that its product contained cocaine. Would the result in the case likely have been different? Explain your answer.