51 B CASE FILE 2

Unit 5. Exefcise 22 ROLE: Client (BIBEe)

Parties to contract: BIBEC Corp (Buyer) and franklin
Your chent sells bottling machines which cost €250,OOO Auto IncluslJies. Inc. (seller)
each. They are guaranteed lor a year and have a year's Reason for consulting lawyer: 00 we have a bindmg
service plan included. Your client doesn't usually offer agreement? Can we force them to make the sale? If not.
credit and can deliver them in two months' time. what can we recover?
Facts of the case:
Long period of negotiations regarding the sale of
Unit 6. Exercise 25 Franklin to BIBEC.
..... ParlJes sign a leiter 01 Intent stating only thai each
party YiOUId 'make eNer'f reasonable effort to agree
CASE ALE 1 upon and have drafted as soon as poSSible' a
ROLE: Lawyer contract 01 sale.
Introduction: greet client; explain what will happen In Soon thereafter. Franklin gets a better offer.
interview; discuss circumstances of interview ..... Franklin terminates the agreement based on
Getting an overview of the case: What is the nature of 'unforeseeable circumstances'.
the dispute? Signed agreement?
Establishing facts and chronology of events: What
happened? Notice to terminate the contract - how? In Unit 15. ElleN::ise 10
wntlllg? What were the reasons? Was thefe anythmg in
the contract which might permIt 8eflnet to temlll'late the CASE 1.: CUENT
agreemeot? Description of t"e situation
Identifying issues, developing and supporting a theory: You are the owner and managing director of a mid-Sized
Recovery In general: Based on what has been described, language SChool in a small city. Your competitors are
Allied might have a chance at recovery. but it will depend three companies of equal size and five considerably
on the evidentiary findings. Had there been a contractual smaller companies. Until now. all of you have been able
proviSion requiring Bennet to conduct a site investigation to co-exist relatively well. At a language teaching
before commencemenl of the work, the risk would have conference held last month. you met With some of the
been shifted to Bennet. ThiS IS OOfmally the case In owners of the other language schools informally. There
conStructJ(ln conlractS of this type. However. SInce lhe was talk of worKing together and of agreeing to co-
contract cloes not contain such a clause. the court could ordinate pricf!s so that all of you could charge more and
very well find thai Allied is charged WIth knowledge of the increase profits. One of the other language school
conditionS of Its own premises. A deciSion concerning owners mentioned that this was illegal. but you are not
...mich party had this duty might very well CQme down to a sure that a friendly co-operation of this kind would be
factual determination at tnal. breaking any laws. You would like to ask your lawyer If It
Possible damages: Uquidate<.i-damages clause? The is illegal or not.
absence 01 a Iiquidate<klamages clause makes the
measure of damages very complex. Should the court rule
in Allied's fallQlJr. the standard measure of damages
would be the CQsts Allied incurs In replacing Bennet .....Ith CASE 2: LAWYER
another firm to complete the work. i.e. in the nature of lnfonnatlon on antkompetltlve activity
compensatory damages (e.g. Bennet agreed 10 bUild for Bid-rigging and collusive tendenng IS when competItors
€ 1 million. replacement contractor costs €1.5 million. make agreements amongst themselves regarding the
damages €O.5 million). Damages for lost time and delay submiSSion of bids for job contracts. Some forms of
would also have to be considered. but these might be collusive tendering are:
difficult to determme. Damages might also be available '"' bid suppression: when a company refrains from
for lost rental income. but this would depend on both the submitting a bid so that the competitor is awarded
facts and the foreseeability 01 such damages. Since the contract
Allied could engage another firm to do the work. specifIC ..... complementary bidding: a company submIts a bid
performance IS most likely not an Optlon. Besides. Allied that IS IfItenuonally too high so that the competItor
would not want to compel performance even If the recerves the contract
remedy was available. because an unwilling contractor. ..... bld rotation: compames agree 10 take tums
whICh Bennet will most likely be. will make a mess of submitting the lowest and best bid
thmgs.
Concluding the Interview: assess the case: Recovery far
from certain. Importance of the financial aspects of
pursuing the matter should be balanced with potential
setUement.
Descnbe neX! moYeS; refer to neX! contact; say goodb)'e.