Legal Environment of Business
1- Jenni entered into a September 28 agreement to sell Andrea $567,000 worth of steel scrap. The signed, written agreement specified delivery to take place on November 2 at Andrea's business in Omaha, Nebraska. On October 9, Jenni assigned her right to payment on the sale to 13th National Bank of Milwaukee in return for $560,000. On November 1, Jenni realized she did not have enough scrap to complete the delivery. She then contacted Walter, another scrap dealer, who said he agreed to deliver the quantity necessary. Because the price of scrap metal had fallen since September, Jenni only was required to pay $541,000 for the same weight of scrap. Jenni immediately paid Walter but did not discuss the matter with Andrea.
Walter offered to deliver the scrap on November 2 in Omaha. When Andrea saw the train cars arriving and realized the source was Walter, she refused to accept delivery of the cars full of good quality scrap metal. Andrea had a long-standing, inter-personal dispute with Walter dating back to a 2004 deal between the two. After the 2004 transaction, Andrea had decided never to deal with "that two-faced, lying scum, Walter."
On November 15, 13th National Bank demanded payment of "our $567,000 payment for the steel." Andrea refused to make any payment as did Jenni when she was subsequently asked to pay the amount on Nov. 16.
2- Beth entered into an agreement to remodel Horace's house for $450,000. Beth developed her plans and had them approved by Horace. Beth then began ordering supplies and hiring sub-contractors to perform the work. Beth worked on the alterations during a six-month period while Horace was located in Iraq for work. She specifically agreed to "complete the project on or before Nov. 20, 2013 in anticipation of your return from Iraq."
Horace returned on November 23 and went to see his house. While he was there, he noted that Beth had not completed all of the work in a satisfactory manner.
a) Beth had not installed a new air conditioning unit in the house. The agreement had specified a $30,000 high-efficiency system.
b) Beth's painters had painted the rooms but Horace looked at the results and simply said, "they are not good enough for my tastes. I am a person who takes great pride in the appearance of my home." The day before, two city building inspectors had toured the home and approved all of the work. They had specifically asked Beth who she used for the "excellent paintwork." Because of the two items, Horace declared Beth was in breach of contract. He refused to pay any of the $420,000 amounts because Beth had not performed the work. Beth offered to install the missing air conditioning system but claimed the painters did a "very professional job."