Theory Practice Sample Essay

Theory Practice


A contrast is a concurrence between two individuals that is aimed at establishing an enforceable obligation to desist from, or doing a given thing. When parties enter into a contract, the terms of that contract should be well outlined. The dangers of contravening the contract should be declared as a guarantee that all parties play their roles without compromise. A contract is binding and the involved parties should try to meet all its requirements. Legal action can be taken once one of the parties feels aggrieved.

Theory Practice

In the case involving Big Time Toymaker (BTT) and Chou, the parties got into a contract. The contract was made at the time when BTT paid Chou $25,000. This implied the willingness of the two companies to enter into a binding agreement. BTT was the first one to express interest in the distribution of Strat to Chou. The mentioned payment was part of the agreement between the two parties. This is clear indication that a contract existed between the companies. Further, the amount was to cater for the exclusive negotiation rights for a period of ninety days. There is a clear indication that the activities of the parties fall under the implied contract.

An agreement can become an implied contract when the parties engage either in a contract suggested in fact or in law. This kind of contract involves the responsibilities emanating from a mutual agreement and intent to promise (Cross et al, 2009). The contract usually recognizes conventions that are not expressed in words and provides the parties with reprieve to hinder people from taking advantage in the absence of written agreement. The demeanor of BTT makes the contract to arise and this binds the parties involved. The email sent by BTT to Chou can authenticate the contract, thereby making it binding since it states that all the terms had been agreed upon because both had an obligation to keep to the agreements.

Various factors can be used to support Chou with regards to the objective intent of the party to the agreement. The most apparent factor is the specific performance. BTT had promised to distribute Strat to Chou and both parties entered into a contract. BTT can be held responsible for breach of the agreement. The court can order BTT to render the services that she had earlier on promised in the agreement. The two parties attained an unwritten circulation in a meeting. This implies that Big Time Toymaker had promised to offer the services to Chou. The court may find it challenging to establish the amount of monetary damages suffered by Chou after BTT failed to honor part of the agreement that she made. Chou can argue that the company was not able to buy the Strat from another distributor (Cross et al, 2009). This can also work against Chou since the exclusive negotiation agreement stated that circulation could not begin until the relevant contract existed in writing.

Reformation is also another factor that is likely to work in favor of Chou because there was an imperfection in their agreement. The imperfection created a dispute between the two parties and the court can choose to redraft it in accordance with the tangible intentions of the parties. From the start of the agreement process, it was clear that both Chou and BTT had the intention of working together. The decision of the court is likely to be in favor of Chou since there is adequate foundation for believing that the BTT intended to supply Chou with the mentioned product. Reformation on the other hand, can also work against Chou with regards to the parties’ objective intent to the agreement (Cross et al, 2009). The court can also establish that BTT acted in good faith since it easily allowed Chou to make a draft agreement, a role the company did not play. This can be used against Chou since the company assumed that the email served as an agreement. Chou can be accused of ignorance because of failing to draft the accord.

Communicating through E-mail

Communication via e-mail between the parties does not have much effect on my analysis of the above questions. E-Proofreading-Editingmail is a way of communication and does not bind the parties in any way. This implies that BTT and Chou should have made the agreement formal and legal in order to clear any doubt. In their agreement, it was clear that the agreement could only be formalized if there was a written agreement. The e-mail is not fully binding since it bears no formality. Unless there was a formal document affirming that, the e-mails were binding. The court can rule that communication through e-mail is the same as other forms of communication.

The Statute of Fraud

The Statute of Fraud can play the cautionary role since it requires the parties involved to inscribe down their agreement and its contents. This helps in making sure that the parties take the contract acutely. The lack of a written agreement greatly contributed to the results of the contract between BTT and Chou (Cross et al, 2009). Their agreement did not have the cautionary outcome and this explains why BTT did not take it seriously. Statute of Fraud can further play the role of an evidentiary purpose. Without a properly written contract, parties can easily go to court and deny the existence of a contract. Ignoring this brought misunderstanding between Chou and BTT.

The Doctrine of Mistake

Under the Doctrine of Mistake, BTT can argue that the contract is not legally binding since it did not convene the criteria of a valid agreement. For BTT to successfully launch this complaint, the company has to prove beyond reasonable doubt that the elements in the agreement are not true (Cross et al, 2009). If Chou manages to prove on the contrary, the agreement can be declared valid. Chou did not experience any detrimental impacts because of the actions of BTT. BTT can also present another argument to the court by trying to show that both parties shared the same mistakes.

Assuming, arguendo, if the e-mail is considered to constitute an agreement, the argument that can be applied in its favor is the declaration that all the terms had been agreed upon by the parties involved (Cross et al, 2009). This can easily give Chou an avenue for winning the case since it would mean that the jury found grounds qualifying the agreement as a contract.

A possible remedy in this case is that both parties realize that they made a mistake and decide to settle the matter out of court. This should be done out of good will because the parties made some assumptions that resulted into the contravention of the contract law. However, Chou can also seek the guidance of the courts to make sure that BTT is compelled to distribute Chou’s new products. By taking this step, Chou will be taking a risk because one of the remedies that are not likely to occur is that either party escaping the law without any consequences since both has a role to play in the entire process.


BTT and Chiu could have avoided this scenario is they abided by the law in reaching at this agreement. None of the parties can strongly claim a favorable judgment from the court because they acted in ignorance. Before changing the management of the organization, BTT should have considered all the pending matters. Chou on the other hand, ought to have drafted the agreement as the company had promised in order to prevent the delay in the whole process.

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Cross, F. B., Miller, R. L. R., & Cross, F. B. (2009). The legal environment of business: Text and cases : ethical, regulatory, global, and e-commerce issues. Mason, OH: South-Western Cengage Learning. Print