Guiseppi Holdings ("Guiseppi"), a residential apartment developer, was embarking on the construction of twin 30-storey towers in the (fictitious) town of Hillwood, British Columbia. In the past two years, construction costs had sky-rocketed, so the project was already over-budget. In response, Guiseppi decided to quickly sell some of the bare land it held elsewhere in Hillwood for cash. Guiseppi decided to sell two of its bare land lots in North Hillwood (Lots 27 and 28). Both lots were zoned for multi-family residential buildings/towers.

On April 1, Mr. Guiseppi called Ms. Jafari, the president of Precious Properties ("Precious"), a fellow residential development company, offering to sell the two properties for $5.5 million. Ms. Jafari stated that she would need some time to think about the offer.

Answer the following three questions.

Question 1 (5 marks)

On April 8, Mr. Guiseppi called Ms. Jafari to let her know that he had found a buyer. Here is how some of the telephone conversation went:

Ms. Jafari: Hello?

Mr. Guiseppi: Hi, Ms. Jafari, this is Mr. Guiseppi calling. I hope you're doing well. I wanted to give you an update on Lots 27 and 28 that we spoke about last week.

Ms. Jafari: Oh, that's great timing, because I spoke with our board of directors and I'm pleased to tell you that Precious will accept your offer to purchase Lots 27 and 28 for $5.5 million - congratulations!

Mr. Guiseppi: Wait, you can't do that, we already have a buyer. We sold it yesterday to Mr. Cheng!

Based on the above, has a valid and enforceable contract been formed between Guiseppi and Precious?

Question 2 (8 marks)

Disregard the April 8 telephone conversation in Question 1. Instead, imagine that, after the April 1 telephone offer from Mr. Guiseppi, the following occurred (i.e., the April 8 telephone conversation never happened).

On April 3, Ms. Jafari emailed Mr. Guiseppi to ask him whether he would be interested in selling Lot 27 only, as Precious did not have the funds currently available to purchase both Lots 27 and 28. Ms. Jafari stated that Precious would pay $3.0 million for Lot 27. Mr. Guiseppi replied on the same day, telling her that, for the time being, they still hoped to sell both lots as a package, but would consider selling the lots separately if it could not sell them as a package within the next few days.

On April 6, Ms. Jafari heard a rumour (from a credible source) that the Hillwood city council was seriously considering building a new subway system, with a station to be located near Lots 27 and 28. She quickly typed up a letter that day, on official Precious letterhead (and a seal!), accepting Mr. Guiseppi's offer to sell her Lots 27 and 28 for $5.5 million. She mailed the letter on April 6, and Mr. Guiseppi received it on April 9.

Ms. Jafari's letter came as a complete shock to Mr. Guiseppi because, on April 8, he emailed Ms. Jafari to accept her offer to buy Lot 27 for $3 million. This email similarly came as a surprise to Ms. Jafari, who saw this email on April 9.

So, on April 9, there was a very "interesting" telephone call between Mr. Guiseppi and Ms. Jafari, which was full of yelling and curse words, and ended with each threatening legal action against the other.

Has a contract between Guiseppi and Precious been formed for the sale of Lot 27 and/or 28? Give full reasons for your answer.

Question 3 (2 marks)

Refer to the facts contained in Question 2; however, imagine that, instead of mail, Ms. Jafari sent her acceptance letter via email to Mr. Guiseppi on April 6, and that Mr. Guiseppi read the email that day. Would this change your answer to Question 2?