1. You enter an expensive restaurant and are seated by the hostess. A waiter brings you plates, knives, forks, napkins, and other set-ups for dinner, including bread and butter and ice water, all of which you partly consume. When you read the menu, you realize that the prices far exceed what you can afford. You then make it clear that you do not intend to order a meal. What type of contract (obligation) do you have, if any? What factors and contractual elements will you consider in assessing whether a contract was formed?
What if, instead, you read the menu and place an order, but say nothing about agreement to pay. Is there a contract? Also, assume there is fine print at the bottom of the menu that states: 20% gratuity charged. $20.00 cover charge per table. If you ordered dinner but didn't see the fine print, what is the effect? Does this change in the facts alter your conclusion regarding the scenario above? Why or why not? What key factors and elements are at play?
When answering the question, please describe what a contract is and then discuss the facts presented here.
2. Maria, who lives in Seattle, sent Koji a letter via first class mail, stating, "Koji, I think your 2003 Ford SUV is worth $20,000. I will give you $20,000 cash for it." Koji receives the letter, but believes his car isn't worth more than $14,000 due to the manner in which he drives the vehicle and due to the weather in Florida where he resides.
Maria's letter was mailed on Monday. When she didn't hear from Koji by Wednesday, she sent an e-mail on Wednesday afternoon with the same message, and asked whether he received her letter. Koji received Maria's letter on Wednesday, but did not receive the e-mail until Friday afternoon, due to server problems. In the meantime, Koji sent a fax late on Friday stating, "Are you sure you still want to buy my car for $20,000? I accept your offer."
On Saturday, after some research, Maria decided the Ford SUV was not worth what she thought. To make certain Koji would know this fact, she sent Koji a letter via Federal Express stating, "Your SUV is not really worth $20,000." On Monday morning, Koji received the Federal Express letter from Maria. Also on Monday morning, an hour later, Maria received Koji's fax at work.
Has a contract been formed here? Why or why not? Identify and explain the stages of contract formation as they occurred in this scenario and analyze them in this context from a contract formation standpoint.
3. Describe the mailbox rule. When is it applied?