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PrintCo Contracts Fact Pattern Based on the fact pattern below, identify the facts that establish each of the six elements; if any are missing, identify which ones. All elements of a sales contract...

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PrintCo Contracts Fact Pattern

  1. Based on the fact pattern below, identify the facts that establish each of the six elements; if any are missing, identify which ones.
All elements of a sales contract should be included and identified in the facts given.
PrintCo is a German company established in Frankfurt that manufactures industrial printing presses. They have been in negotiations with Worldnews, an American newspaper publisher in New York, to sell them 15 new printing presses. A representative from PrintCo travels to New York to negotiate a deal with the CEO of Worldnews on January 1, 2013. At the meeting Printco offers to sell 15 printing presses at a price of One Hundred Thousand Dollars ($100,000) per unit. The parties agree to use the UN Convention for Contracts for the International Sale of Goods (CISG). Worldnews agrees to a final price of One Million Five Hundred Thousand Dollars ($1,500,000), but insists that the contract should include a clause stating that the forum for any dispute arising during the contract should be arbitrated using New York law.
Furthermore, Printco has guaranteed that it will deliver the presses by February 1, 2013. The parties have included a “CIF clause” in the contract. Since Printco has never done business with Worldnews, they requested that Worldnews pay by using a letter of credit.
  1. Assume the facts below occurred after the signing of the contract.
  1. Printco’s suppliers go on strike on January 5th. Due to this disruption, Printco has to outsource and obtain the raw materials for manufacturing the printing presses from another supplier. Printco’s costs have increased by 20%. In order to please its shareholders, Printco attempts to pass this additional cost on to all of its customers. A representative from Printco calls the CEO of Worldnews and says that they will not be able to deliver the printing presses unless Worldnews pays an additional 20%. The CEO of Worldnews is furious; however, he is under a lot of pressure to get the new presses installed on time and a lot of time will be wasted if he attempts to find a new supplier of printing presses. The CEO, although hesitant, accepts to pay the new price of One Million Eight Hundred Thousand Dollars ($1,800,000).
  1. Printco places the 15 presses on a ship at the port and receives the Bill of Lading. They send the Bill of Lading, the insurance certificate and all the other relevant documents to Worldnews’ bank (the issuing bank), which has issued a letter of credit. However, upon reviewing the documents, the bank notices that there is a spelling mistake: Printco’s name is spelt incorrectly on the Insurance certificate. Consequently, the bank refuses to pay Printco.
  1. There is a delay in the shipment, and Printco notifies Worldnews that the printing presses will not arrive in New York until February 5th. When the goods finally arrive, one of the machines is badly damaged from the boat journey.


Explain both sides’ arguments, and then determine who is right and what type of remedies either party might seek? In giving your answer, explain the advantages and disadvantages of using the CISG and using letters of credit for international sales transactions. Furthermore, mention where the parties can resolve their dispute and what the advantages and disadvantages of their options are.
In Conclusion identifies both sides’ arguments and determines who is right with types of remedies available

Answered Same DayDec 29, 2021

Solution

Robert answered on Dec 29 2021
82 Votes
1 | P a g e

PART 1
A contract refers to an agreement which is legally enforceable by the law and states that two
or more competent persons agree to perform or not perform a particular activity. All the
contracts do have a consideration for either of the parties or both. There are some basic
elements of each contract without which a contract cannot exist between the two intended
parties. Following the basic elements of a contract as per the law of the country:
(A) Offer and Acceptance:
A contract is generally formed when an offer is made by a person and the same is
accepted by another person. An offer is made by the person only if he has the will to
make it. An offer cannot always be for a specific person, but in certain cases it can be
for a class of people or also for the whole world. Acceptance is the feedback
eward
of the offer by the other person. The person may reject the offer as well.
(B) Intensions To Create Legal Relations:
A contract cannot be made or created just by a mere agreement. It is necessary for the
parties involved to get the agreement legally enforceable. With this legal obligation,
the parties involved are bound to pursue with the requirements of the contract. “This
will rarely be stated explicitly but will usually be able to be infe
ed from the
circumstances in which the agreement was made.”
(http:
www.lawhandbook.org.au/handbook/ch12s01s02.php)
(C) Consideration:
Consideration is the price or the reward given by the offe
ee to the offe
or.
Consideration given by the other party may not be necessarily in terms of money. It
can be in kind as well. Consideration is one of the essential parts of a contract. And as
http:
www.lawhandbook.org.au/handbook/ch12s01s02.php
2 | P a g e

long as it exists in the contract, the court will never question or doubt the adequacy or
accuracy of the contract.
(D) Legal Capacity:
It is an important aspect for the parties involved to be in their legal capacity to enter
into a contract. Minor, physically unsound, etc. are not eligible to enter a contract.
Special provisions have been made for the parties involving them.
(E) Consent:
Consent means the fact that the parties involved in the contract have made their
decision on a free consent basis and not because of any kind of undue influence or
threats from the hands of other parties. Legal action can be taken against the person
who actually threats a person to enter a contract.
(F) Illegal And Void Contracts:
Illegal contract are those which is not enforceable by law. The agreement can be made
etween the two parties but it cannot be enforceable by the law
Void contracts are those contracts which are strictly prohibited by the statute. Even if
the parties are...
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