1a.

On April 1, 2021, Berryman, a farmer, signed an option agreement giving Kmoch, a real estate agent, a 120-day option to purchase 960 acres of Berryman's land. Although the option agreement called for the payment of $10, Kmoch never paid any money to Berryman. However, Kmoch hired two consultants to produce a business report that he intended to use to interest other investors in joining him when he exercised the option. In the latter part of April, Berryman telephoned Kmoch and asked to be released from the option agreement. Nothing definite was agreed to and Berryman later sold the land to Miller. In May, Kmoch decided to exercise the option and contacted a bank to make arrangements to buy the land. After being told by a bank representative that Berryman had sold the land, Kmoch sent Berryman a letter attempting to exercise the option. Berryman now claims that there is no contract with Kmoch. Did Berryman violate contract law by selling the land to Miller? Explain the legal rules relevant to the resolution of this dispute.

1b.

Suppose instead that Berryman had sold the land to Kmoch who then contracted with Moyer to do excavation work as part of a building project. Moyer dug several ditches as part of its work, but they kept collapsing due to unexpected drainage problems. After redigging the ditches several times, Moyer refused to continue working unless he received extra compensation. Kmoch agreed to pay extra. When Moyer completed the job, Kmoch refused to pay the agreed-upon, extra compensation. (A) Clearly explain the rule the court will follow in deciding if Moyer is entitled to the extra compensation. (B) Suppose that this case had been governed by the UCC. Under the UCC, how would a court determine if Kmoch was required to pay the extra money?