Real 105

Chapter 23

Agency

Be sure to watch the video https://www.youtube.com/watch?v=ioxro5kgTvY

Paul v. Darlene

Offer

An offer is one party's present intent to be legally bound by a proposal. It has to be

communicated and its terms must be clear and definite.

Paul's first email to Darlene asking her how much the TV cost did not amount to present

intent to be legally bound by a contract. It was merely an inquiry.

The term of the offer was Darlene's TV for $400, which is clear and definite. There was

no ambiguity as to what was being sold for how much money.

When Darlene asked Paul, "How would you like to buy it for $400?", she communicated

the offer to him.

Therefore, there was a valid offer.

Study the facts:

Brian was a private lender. He authorized Angelo, a mortgage broker, to find borrowers

for him and instructed Angelo that he wanted at least 4% annual interest rate for all loans.

Angelo found Betty, who was in the market for a home loan, and helped her fill out a loan

application. Betty fell short of qualifying for the loan because her income was not high enough to

meet the monthly principal and interest payments based on Brian's minimal, acceptable interest

rate. She asked Angelo to reduce the interest rate by half of a percent. Angelo submitted the

application with an interest rate of 3.5%. A month later, the loan closed. Betty moved in to her

new home. Brian said to Angelo, "You made a loan that did not conform to my requirements. I

don't owe you any commission."

Five years later, Betty decided to sell her house. She hired Al, a real estate broker, and

gave her a listing for a quarter of a year. A month later, Al suffered a disease that required

medication. Al's doctor negligently prescribed three drugs for him, one of which he did not

really need. As a result of taking the drugs, Al experienced temporary insanity, hallucination and

amnesia for a month and a half. Upon recovery, Al brought a full price offer to Betty, who

rejected it. The offeror was a ready, willing, and able buyer. Al demanded commission from

Betty and she refused.

Betty decided to list her house with Amy, a real estate broker. Amy brought some

prospects to see the house. One of them, Ingrid, noticed dry rots on the side of the garage

window and asked, "Does this house have termites?" Amy answered, "It is completely free of

termites." In fact, there were termite infestations all over the house and Amy knew it all along.

Ingrid asked Amy why Betty wanted to sell the house. Amy told her, "Betty lost a lot of money

in risky junk bonds and had to borrow money from different people to pay for daily necessities.

Make any offer. You can imagine what sort of financial hole she must be in. You're going to get

yourself a great deal."

Ingrid did not make an offer on Betty's house. Amy continued to hold open houses and

found Bruno, who made an offer through Amy at $500,000. Amy contacted her brother in law,

Bruce, and had him sign an offer at $475,000 for Betty's house. Amy told Betty, "Your house is

pretty worthless. Look at it, it's a mess. The only thing you can do is to drop the price. I think

$475,000 is the best deal you're going to get." Betty was convinced by Amy's persuasion and

sold the property to Bruce at $475,000. Amy then sold the house to Bruno for $500,000.

What issues of agency law are raised in this fact pattern? Discuss.

creat a IRAC essay analyzing all of the issues raised in this fact pattern. Here you are not given a list. You are to spot the issues

from the facts and the video and discuss all the issues using the IRAC-paragraph format.