TO: Alexis Fairchild
FROM: Marshall Petersen, Business Owner
DATE: April 12, 2015
SUBJECT: Lawsuit
I have been doing business for many years in my local health food store in Huntsville,
Alabama and, when Jordan Jessee approached me about the selling of the Muscadine grapes
it seemed like an excellent opportunity for my self and her. Ms. Jessee and I entered into a
partnership agreement orally which included: myself promoting her product heavily,
making regular orders, make regular payments in a timely fashion and on her end she
delivers the product as requested and keeps consistent prices. Once Jordan realized how
popular her product was becoming and a bigger company offered more money she wanted
to end our business dealings after her son signed a requirements contract. Not only did
Jordan breach the requirement contract but she also breached the good faith and fair
dealing agreement that goes along with partnerships as this one.
Fasts of the Case
Jordan Jessee and I entered into an oral partnership agreement once I saw how well the
samples she sent me did in my store. Being a local health food store her products were high
in antioxidant and the grape seeds could be used for any different things that my customers
very much liked. Under the good faith and fair dealing agreement that in any contract I did
the following:
Made regular orders weekly
Paid my invoice in a timely fashion
Promoted her product very well
Invested money into her product with promoting it
Treated her with respect and gratitude
For about six months Jordan and I had a good partnership and one that looked like it was
going to last until that sixth month mark she had also done under the good faith and fair
dealing agreement the following:
Delivered product in a timely fashion
Charged me no interest or penalties
Kept consistent prices
Delivered the amount of product ordered
When an article from The Huffington Post wrote about these grapes and how great they
were, because of the promoting I had done for the grapes the demand for them grew
greatly. When another company came in an offered Ms. Jessee a great deal and price along
with an output agreement she chose to leave me out to dry and did not take my business
into consideration. Then I informed her of the requirement contract her son had signed and
how she would be in breach of that contract along with the good faith and fair dealing
contract as well.
Contract at issue
“A contract is generally defined as a leally enforceable exchange of promises or an exchange
of a promise for an act that assures that parties to the agreement that their promises will be
enforceable” (Kubaseky, 2015, p. 239). Even though at first Ms. Jessee and I did not entered
into a formal written agreement our oral agreement holds us just as well in court and she is
legally enforced to honor our deal. Jordan and I entered into “an express contract, which is
an exchange of oral or written promises between parties, which are in fact enforceable in a
court of law. Note that, oral and written promises are equally enforceable” (Kubasek, 2015,
p. 240-241). These both generally say the same thing but I wanted to make it clearly that
Jordan and I had a contract and therefore statement and showing the issues dealing with
her breach of our contract. I entered into this contract believing that Ms. Jessee being a
Christian woman would not go and breach our contract for money.
Legal Issues
Jeremiah 9:4,5 said “Each one cheats his friend, Never telling the truth, They have trained
their tongues to lie, And devote all their energies to doing wrong, You live in a world of bad
faith” (Distelhorst, 2000, p. 57). I did not want to believe this but this became clear when
Ms. Jessee wanted to breach our contract and not thing about the hurt that it may cause on
my business just thinking about hers. I learned that what the Uniform Commercial Code
clearly defined the good faith and fair dealing doctrine meant which to me is important for
this suit, “Section 205 was to secure faithfulness to an agreed common purpose and
consistency with the justified expectation of the other part, and compliance with
community standards of decency, fairness, or reasonableness” (Distelhorst, 2000, p. 62).
Not only does it look at the law side but it also looks at what the community would define it
as which is important. The UCC also has different articles for different areas of business
because each contract is different and there is one for the sale of goods from person to
person. “In Article two, dealing with the sales, the UCC further defines good faith between
merchants as the observance of reasonable commercial standards of fair dealing in the
trade” (Phillips, 1993, p. 1191). Ms. Jessee clearly breached this part of our good faith and
fair dealing part of our oral partnership when she decided to leave our business dealing
with no regard to my business. In regards to her son sign the requirement agreement in he
was seventeen at the time but by law it states “contracts made by minor are voidable and
can be disaffirmed by the minor at any time before the minor becomes of a majority age or
shortly thereafter. If the minor fails to disaffirm a contract, he or she will be considered to
have ratified it and is, thus, legally bound” (Kubasek, 2015, p. 254). Since her son did turn
18 shortly after that and a good deal of time went pass and he did not disaffirm the contract
so therefore the contract that he signed being part of the business and family would be
legally bound. Another area to look at in this suit is the breach of contract based on
“promissory estoppel, which was, the concept that a promise made without consideration
may nonetheless be enforced to prevent injustice if the promisor should have reasonably
expected the promisee to reply on the promise and if the promisee did actually rely on the
promise to his or her detriment” (Business Torts Reporter, 2013). My business does depend
on Jordan’s agreement promise and mine because I invested a good amount of money into
advertising these grapes and good amount of my business relies on these grapes each week.
Requested Remedies and Settlement
“There purpose of compensatory damages, which there are three standards:
1. The plaintiff-buyer show the defendant-seller did not deliver the promised goods,
and the buyer would have no alternative source and then lose profits.
2. Must show the amount of the damages with reasonable certainty.
3. Must show that the plaintiff-buyer did everything possible to mitigate the damages”
(Kubaek, 2015, p. 274).
Clearly I can show all three of these because Ms. Jessee was not going to deliver the grape
product any longer and I would lose profit by not having them in my store anymore and no
time to get another product similar in the store without losing some profit. I can show the
amount of money that I invested in advertising these grapes and the amount of money I
would lose each week by my customers by not having them stocked. Lastly, Ms. Jessee was
only going to give me the name of other suppliers but no time to make arrangements with
them or to see if their product was just as good and if my customers would be willing to buy
them equally. I believe, that Ms. Jesse should have to pay the compensatory damages to me
for her breaching the two contracts of the requirement agreement and the good faith and
fair dealing contract. She should have to pay me until I am able to get another product
similar to hers and make sure that my customers will pay them product or she should work
out an arrangement with the Texas buyer to allow her to still have her product in my store
as well as sell to them. I am willing to compromise with Ms. Jessee as long as she is willing
to work with me so I do not lose a large profit for my store.
References:
Breach of Contract/Fraud. (2013). Business Torts Reporter, 25(8), 208-212. Retrieved from
http://search.proquest.com/docview/1367084489?accountid=12085
Distelhorst, M. (2000). Business Ethics Approach to Contractual Good Faith and Fair
Dealing: Briefly Modeled in Selected Managed Healthcare Contexts. Ohio Northern
University Law Review, 26, 57-62.
Kubasek, N. K. & Brennan, B. A. & Browne, M. N. (2015). The Legal Environment of Business,
7, p. 239- 293.
Phillip, R. M. (1993). Good Faith and Fair Dealing under the Revised Uniform Partnership.
University of Colorado Law Review, p. 1188-1192.
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