The Contract, Its Formation, and Liabilities of the Parties

Nadia is the owner of a small paper supplier. She has decided to expand

her operations and is looking for new customers outside the area in which she normally operates. On the advice of a friend from university who works a few hours away and knows of a business looking for a new paper supplier, Nadia calls Jeff, the owner of a real estate development company, on Tuesday. Jeff is happy to hear from Nadia. The company he normally used had suddenly gone out of business, and Nadia's company could solve his problems. They entered into negotiations over the phone right away, since Jeff knew Nadia's friend and trusted her judgment. After a great deal of discussion, they agreed to terms. Nadia would ship him all the paper products his company would need quarterly, and in exchange, Jeff would pay her one business day before the scheduled delivery. He also promised to pay for the first shipment right away, arranging to transfer the funds to Nadia by the end of the week as soon as he got off the phone, and having the bank send her proof of the arrangement. Nadia faxed the standard contract she used to Jeff at the end of business on Tuesday, after hearing from Jeff's bank. He reviewed it over the course of the next day, since he had already left the office when Nadia had sent the fax, and made a few changes. Specifically, he changed the delivery timeline to a week earlier than the date stated on Nadia's standard form. He then signed the document and faxed it back late on Wednesday night. Nadia signed it when she got into the office on Thursday and faxed a copy with both signatures to Jeff. The date of the delivery came and went. Jeff's office was running out of paper and he needed the delivery badly. He called Nadia to complain and to demand delivery. Nadia stated that the contract she had faxed him had had a specific delivery date, and that that date hadn't arrived yet. Jeff pointed out that he had changed the date. Nadia said that she hadn't seen

the change and wouldn't be able to deliver the products at that time. Jeff

then had to arrange to get paper from another source, and since he needed it the next day, paid much more than usual. Jeff commenced an action for breach of contract.

Jeff arranged right away to transfer funds to Nadia by the end of the week. If he had not done so, which option would have best constituted good consideration under the circumstances?

Select one:

A.If Jeff had signed the contract and sent Nadia a cheque for $1 to represent consideration

B.If Jeff had signed the contract.

C.If Jeff signed the contract with a verbal promise to pay later

D.If Jeff had signed the contract under seal

In this case, forms were exchanged by fax. When would acceptance have taken place?

Select one:

A.On Thursday, when Nadia picked up, signed, and re-sent the fax

B.On Thursday, when Jeff received the copy with both signatures.

C.On Wednesday, when Jeff actually picked up the fax.

D.On Wednesday, when Jeff signed Nadia's form and faxed it to her.

DoesSale of Goods Actapply to Jeff and Nadia's contract?

Select one:

A.No, although it was an exchange of goods evidenced in writing, the contract didn't make a reference to theSale of Goods Actand its applicability

B.No, although it was an exchange of goods evidenced in writing, Jeff didn't pay in cash in person.

C.Yes, the transaction was a sale of goods for money and was evidenced in writing.

D.Yes, theSale of Goods Actapplies to all sales of goods.

Nadia is in breach of her contract with Jeff. What remedy is Jeff likely to seek under these specific circumstances?

Select one:

A.Specific performance Jeff can have Nadia deliver the goods she promised to deliver

B.Injunction Jeff can stop Nadia from selling the goods to someone else.

C.Damages Jeff can have Nadia pay him a sum of money in compensation for the breach

D.Option to terminate Jeff can have an option to terminate the contract clause within the contract enforced by the court

If Jeff did seek damages from Nadia for the breach of the contract, what kind of damages would he receive?

Select one:

A.Liquidated damages

B.Expectation damages

C.Nominal damages

D.Reliance damages

Nadia and Jeff's exchange of documents involved the change of one of the terms of the standard contract Nadia normally used in business. Under which terms is the contract formed and why?

Does Jeff's counter-offer, made without drawing attention to the change in delivery date, constitute misrepresentation?