FACT PATTERN 4 Brothers Nick and Zack recently came into a large amount of money. Nick is 17 but can easily pass for 21. Zack is 16. To celebrate their good fortune, they go on a spending spree. Nick buys a $40,000 car for himself. The next day, he buys a second car for $30,000. He immediately gifts this car to Zack by transferring the title into Zack's name. (The dealer wouldn't sell the car directly to Zack since Zack was underage -- the dealer never questioned Nick's age). Twenty (20) days after his 18ih birthday, Nick runs into some legal problems and needs to raise some money for legal fees. He sells his car on Craigslist for $35,000 and gives the money to his attorney as a retainer. He then calls the auto dealer and "disaffirms the contract for his car and seeks a refund of the $40,000 purchase price. Four weeks later, he calls the dealer and tells him that he "disaffirms the contract on the second car(which he had gifted to Zack) and wants a refund of the $30,000 purchase price of that car. Nick points out that he cannot return this car since he previously gifted it to a third party (Zack) and no longer has it in his possession. (It should be noted that during the seven week period since Nick turned 18. Zack has driven his car, had it inspected, had the oil changed and renewed his auto insurance). The dealer refuses to refund the money for either car. RESULT? BUSINESS LAW AM 2009 TEST 1 GUIDE SHEET When evaluating the fact patterns to determine issues, rules of law etc., you may want to consider the following questions. These are presented for guidance only and are not all inclusive". In fact, after a proper consideration of a particular question, you may conclude that it is not relevant to the facts presented. These are among the questions that you should be asking/answering yourself as you approach the various fact patterns. Keep in mind the arguments that each side will have to make to advance his/her own case as well as the arguments that each will have to make to counter the arguments of the other side. NOTE: YOUR TEST ANSWERS SHOULD BE IN PROPER FORMAT. DO NOT PREPARE ANSWERS TO THE QUESTIONS BELOW GENERAL ralsed? For any issue you raise, have you given the applicable rule(s) of law have you fully analyzed the situation and does your conclusion answer the questions you have if you gave a rule of law, have you used it in your analysis. If not, is the rule relevant to the situation? If you discuss something, have you given the applicable rule(s) of law? FACT PATTERN 1 Did the offer have to be accepted at any particular time or in any particular manner? Were any such requirements complied with? What is the impact, if any, of (1) the seller fax (2) the secretary's telephone volce mail? Since obviously, the seller no longer wants to sell and the buyer definitely wants to buy, is there a valid contract? IN ANALYZING THE INFORMATION, IT MAY BE HELPFUL TO CREATE A TIMELINE FOR YOURSELF. FACT PATTERNS 2/3 - REMEMBER TO ANSWER AS TWO SEPARATE QUESTIONS Theory 1 - What was the nature of the fraud/misrepresentation? Does it meet the legal requirements? Ken is successful on this claim, what remedy is he entitled to? Theory 2. What are the requirements for recovery on this theory? Are they mel? 1 Ken is successful on this claim, what remedy is he entitled to? FACT PATTERN 4 - What are Nick's rights to "disaffirm" as to each automobile? If he had such a right, was it done timely/properly? What are the rights of the auto dealer (as to each automobile) If Nick can "disaffirm"? What is the obligation of Nick and/or Zack (as to each automobile)? If your answer depends upon whether something is "reasonable" or "unreasonable you must explain why
