Big Time Toymaker V. Chou Essay

1. At what point, if ever, did the parties have a contract? I believe that there were two contracts made in this scenario. The first one was the verbal contract that sated that the stipulations of price and the fact that there needed to be a written contract before distributing the product. The email, since it was in writing can also count as a written contract; both parties had knowledge that there would be some sort of written agreement. Chou was in the right to think that the email stating the key terms and agreements counts as a contract. 2. What facts may weigh in favor of or against Chou in terms of the parties’ objective intent to contract? The facts that Chou was in a verbal agreement with BTT will be helpful in proving that they had a preliminary agreement pending a written one. The fact that an email was sent to him with all the key terms, price, time frames and obligations is also helpful in proving that Chou had a valid agreement with BTT. I believe that that email would count as a binding contract since both parties had a promise pending performances. This was a mutual assessment in which there was an offer by BTT and an acceptance by Chou. 3. Does the fact that the parties were communicating by e-mail have any impact on your analysis in Questions 1 and 2 (above)? In a way it does because when I think of an agreement I think of it as a written and signed agreement by both parties. However BTT did not specify in what kind of writing this contract needed to be. They did not specify if there was need to sign, notified or have witnesses for the contract. Email communication between two people describing the key terms of a contract and having both of them acknowledge the key terms to me serves a contract. While there was no signature, it had both parties’ names on it, it could be said that it was an E-signature. Also we have to keep in mind that the terms were also discussed verbally prior to the email being sent. 4. What role does the statute of frauds play in this contract? I believe that this email communication meets the statute of frauds and the fact that it had the named of the people in business counts as a contract. There have been cases were the name at the end of an email counts as a signature, example Stevens v. Publicis, were the publicis won because the name of both parties were in the written emails. In this case both parties names are on the emails and that signaled both parties intent to do business. 5. Could BTT avoid this contract under the doctrine of mistake? Explain. Would either party have any other defenses that would allow the contract to be avoided? I think that BTT might have a chance to void the contract under the doctrine of mistake because they can claim that Chou misunderstood the fact that the emails meant that he was able to go ahead and distribute the product, making it a bi ding contract. However it was clear that the email stated the facts of the contract and BTT did not specify that Chou should in fact continue to draft the contract for both parties to sign. I think that BTT would have a hard time voiding the contract under the doctrine of mistake. I think that fact there was no specification to how the contract would be written leaves a lot of vague results. BTT should have been more specific in their emails saying that Chou should still have to draft a contract agreement and that the email was not enough for the contract. In this scenario BTT would have a ch ance at voiding the contract. 6. Assuming, arguendo, that this e-mail does constitute an agreement, what consideration supports this agreement? The fact that BTT promised distribution rights to Chou pending an agreement counts as consideration. In this case, something of value was put on the line by both parties, entering them into an agreement to exchange mutual performances. In this case there was also a value that we can determine, and that was $25,000 paid to Chou in exchange for exclusive negotiation rights. I think that consideration was present in this agreement, making a valid contract. At the end of the scenario, BTT states that it is not interested in distributing Chou’s new strategy game, Strat. Assuming BTT and Chou have a contract, and BTT has breached the contract by not distributing the game, discuss what remedies might or might not apply. In this scenario the remedies that would apply would be, compensatory damages because in this case Chou suffered a loss of potential profits that he would have made by his new game. It would also repay him as if BTT had not breached the contract. I think that if he could not claim compensatory damages then he would also be able to claim consequential damages because it states that it compensates the non-breaching party for foreseeable indirect loses. It also states that it involves a unique circumstance beyond the contract. In this case the contract BTT made was taken over by someone else who at the end did not want to do business with Chou. Restitution and Liquidated damages do not applied to this because there was no unjust enrichment by BTT due to the breach of contract. BTT and Chou did not agree to any damages ahead of time there fore liquidated damages does not apply.