There is a Lot Going on and You Are in the Middle

Readthissituation below, which requires you to make decisions andtake action, applying principles of contract law.Discuss your rights and liabilities as the Caterer and the rights and obligations of the Client under theFull ServiceCatering Contractwith references.Thisservice contractcontains the provisions necessary for this problem.

Address the following:

• What are your defenses?

• Are you entitled to keep all or part of the deposit? Is it nonrefundable or can you claim an amount equal to the value of the non-food services?

• Is this contract governed by the Uniform Commercial Code or the common law?

• Which is predominant, food or service? Which interpretation favors you?

• Which facts support commonlawand which lead you to the Uniform Commercial Code UCC?

• Is there an exception that would make an oral contract enforceable?

• Would the Force Majeure clause excuse your performance?

• What is your defense to the claim of no license in Kentucky?

• What damages could Slick Seminars recover?

• How would they calculate compensatory damages?

• Would they be better off claiming reliance damages?

• Are they entitled to restitution damages?

• What is the likelihood of their recovering consequential damages?

• How would they calculate their lost profits?

The situation:

You are the acting catering manager ofBigBiz'sfood services division. You have entered into a catering service agreement with Slick Seminars, Inc. to supply banquet and setup services in an events room on your premises in Louisville, Kentucky. The event was a presentation to potential purchasers of a personal coaching program. This is the first event for which you are responsible, so you want everything to be perfect (which it never is).BigBizsupplies the banquet room, tables, chairs, decorations, setup and cleanup, servers and security. The food is served at table by your wait staff. The services arrangement was negotiated and reduced to writing onBigBiz'sstandard form contract. The contract was delivered to the client's authorized representative for review and signing by the client's president. As it turns out, a signed contract was not returned. However,Theclient sent a check for $24,000, a deposit of half of the total charges. The balance of $24,000 was to be paid at the end of the event. You charged $40 per attendee with a guarantee of 120 meals to be served. The charge included the rent of the hall, set up, clean up, the food, the beverages, and all personal services. You continued to coordinate the client's requirements in weeks leading up to the event. On the scheduled date of the event, your team had furnished the room with chairs and tables with tablecloths and utensil setups. The space was decorated to the client's specifications with a podium and small sound stage at the front of the room.

The presentation was scheduled to begin at 4:30 p.m. By 2:30, a partial service and security staff was on premises. Coffee, tea, soft drink and bottled water and snack service were set up. There was no kitchen on premises so hot and cold food items prepared inBigBiz'scommissary in Sellersburg, Indiana, were on delivery trucks scheduled to arrive and be served according to the client's schedule. A team of the client's employees, including the company president, showed up at 3:00 p.m. They complimented you on the room and preparations and began greeting attendees as they arrived between 3:30 and 4:00 p.m. The presentation began at 4:30. A full course hot dinner was scheduled to be served at 6:00 p.m. No alcohol would be served. According to Slick's promotional material, the meal was an inducement to attend. Most of the approximately 100 attendees appeared to be financially well off middle-aged to elderly couples. They had paid $50 apiece to attend.

By 5:30, the guests began to show signs ofimpatienceand several looked around for indications of the meal to be served. Your trucks should have arrived by now and you started to panic. You had not heard from the delivery crew or the commissary. Your cell phone rang. A wreck on I-65 had stopped all southbound traffic and your vehicles were nowhere near an exit. They never arrive. You tell this to the client's president who reluctantly announces to the guests they will not be getting a meal. Predictably, they are unhappy, demand a refund, and walk out.

Slick Seminars suesBigBizfor breach of contract. They want their deposit returned plus $5000 for the refunds to the attendees. They had estimated they would sign up 25 attendees for a course in professional coaching, at $500 per course, plus $10,000 in gross sales of books and DVDs at the seminar. Also, they discover that you do not have a food service permit in Kentucky. Kentucky views a catering business as a food service establishment. This requires you to adhere to the state's food permit and food safety guidelines. They claim the absence of a permit renders your contract void and unenforceable. However, you do have a food service permit in Indiana, where the food was prepared.

The Service Contract:

FULL SERVICECATERING CONTRACT

IN WITNESS WHEREOF, the parties have executed this Contract on the dates set forth below in accordance with the terms attached.

1. ThisFull ServiceCatering Contract (the "Contract") is entered into on February 28,2018between Slick Seminars, Inc. (CLIENT) andBigBiz, LLC (Caterer) for the purpose of allowing Caterer to provide facilities, food and other services for an Event on Caterer's premises on April 18, 2018.

2. Services Provided: For this Event, Caterer agrees to provide the following Services:The Event hall, set up, clean up, podium and sound equipment, exhibit tables, snacks and non-alcoholic beverages, food for the agreed-upon event menu for the guaranteed number of guests, dining tables, chairs, china and tableware, all decorations, table linens, decorative place settings, glassware, wait staff and security personnel.

3. Caterer's Compensation

3.1. Charges inclusive of all Services: $48,000

3.2. Nonrefundable Deposit: $24,000

3.3. Due at Completion: $24,000

4. Required Permits, Licenses, Registrations: Caterer warrants, represents, and agrees that Caterer and all individuals assigned to provide Services will obtain and maintain, at Caterer's own cost,any and allapprovals, licenses, filings, registrations and permits required by state and any other applicable authority legal requirements.

5. Force Majeure, Excusable Delay. In the event of a delay caused by inclement weather, fire, flood, strike or other labor dispute, acts of God, acts of governmental officials or agencies, accidents or any other cause beyond the control of the Caterer, the Caterer's performance is excused hereunder.

6. Notice. Any notice or communication required by this Contract shall be in writing and shall be deemed to have been duly given if delivered personally, or sent by overnight mail, or prepaid registered mail, or confirmed e-mail, addressed to the parties as set forth in the Contract.

7. Status of Parties. The Caterer is an independent contractor. This Contract is not intended to create, nor shall it be construed to be, a joint venture, association, partnership, franchise, or other form of business relationship. Neither party shall have, nor hold itself out as having, any right, power or authority to assume, create, or incur any expenses, liability, or obligation on behalf of the other party, except as expressly provided herein.

8. Third-Party Beneficiary. There are no intended third-party beneficiaries to this Contract.

9. Severability. If any provision of this Contract is held invalid, illegal or unenforceable in any respect, such provision shall be treated as severable, leaving the remaining provisions unimpaired,provided thatsuch does not materially prejudice either party in their respective rights and obligations contained in the valid terms, covenants, or conditions.

10. Modification of Contract. Changes to the Contract must be in writing and signed by Caterer and CLIENT.

11. Applicable Law. This Contract shall be governed by the laws of the Commonwealth of Kentucky. Any legal actions whether state or federal brought to enforce this Contract shall be brought in the courts of Jefferson County in the Commonwealth of Kentucky.

12. Authority. Both parties represent that each has the full authority to perform its obligations under this Contract and that the person executing this Contract has the authority to bind it.

13. Entire Contract. The Contract constitutes the entire agreement between CLIENT and Catererwith regard toall matters herein and may be amended in writing only and signed by both parties.

ON BEHALF OF CLIENT ON BEHALF OF CATERER

By:_____________________________________ By:_________________________

Name:__________________________________ Name: -------------------------

Title______________________________________Title:___________________________

Date____________________________________ Date:_______________________________