14 Jun LIFE’S A BEACH COMPANY CASE STUDY
Busy Builders, Inc. verbally contracts with Life’s A Beach Company to build a Cool Juice ‘n Fruit stand near Inviting Beach for $25,000, with half of the payment in advance and the remaining half due on completion. The work is to start on April 1, and be finished by June 1, so the stand can be open for the entire summer, which is made clear to Busy Builders. Busy Builders, devoting most of its workforce to a larger, better paying construction project, does not finish the work until June 21. The stand opens, but Life’s A Beach loses three weeks of early summer sales due to the delay. Life’s A Beach decides not to pay Busy Builders anything, asserting the Statute of Frauds as a defense and also the breach by Busy Builders in not completing the stand on time. Busy Builders sues Life’s A Beach, which files a counterclaim. What happens, and why?
Assume that the above contract is in writing, and includes a provision that time is of the essence, and also provides that in the event of a breach by Busy Builders, Busy Builders will pay Life’s A Beach the sum of $100,000. Events occur as above, with Busy Builders not completing the job until June 21. What happens, and why?
Assume the above written contract is agreed to by both parties. On May 1, Busy Builders tells Life’s A Beach that it cannot complete the project by June 1 because it is busy with other more lucrative projects. What can Life’s A Beach do in that situation? What if Busy Builders offers to put its other projects on hold for several weeks in order to finish the Cool Juice ‘n Fruit stand by June 1, but says it will require Life’s A Beach to pay an additional $10,000 to get “priority status” and get the workers and material to finish it up? Assuming that Life’s A Beach reluctantly agrees to this, and Busy Builders gets the job done on time, what would happen if Life’s A Beach refuses to pay the additional $10,000?
What if Busy Builders had delegated the duty to build the stand to Shoddy Construction Corp., which completes the structure on time, but it is significantly inferior to what Life’s A Beach wanted and reasonably expected from Busy Builders?
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