Running head: Mediation Memorandum
Mediation Memorandum
BUSI 561 Business Law
Harold L. Walker
Liberty University
Prof. Daniel White
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Mediation Memorandum
Facts of the Case
Around six months ago my wife and I started to attend a new church in the Huntsville,
Alabama area. While at the church I met an acquaintance whom I found out owns a produce
company. After awhile this acquaintance asked whether I would be interested in one of his
products, which is a grape that is high in antioxidant qualities. He asked me if I could help his
company by promoting the products and sent me a few samples. After gauging the products
popularity from a few of my customer I decided to contact my acquaintance and placed a small
initial order. As business gained traction I started to place bigger orders of the grapes. When I
started to place these bigger orders I also started to advertise the product more within my store. I
have never missed a payment to my acquaintances company. Being that I have started to invest
heavily in their company and did considerable business I gave a contract to their company, which
was signed and returned. After signing with my company the Huffington post did a piece on the
grapes, which caused my sales to skyrocket. Seeing this the grape company decided that they
didn’t like our signed offer and tried to renege on our prior commitments.
Contract at Issue
The contract we are currently discussing is a Requirements Contract signed by the son of
the other company’s owner. In that contract the company agrees to a regular delivery schedule
and a pricing guarantee that has been fair for both parties in our fruitful relationship. “Suppliers
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To: Alexis Fairchild, Mediator
From: Marshall Petersen, Store Owner
Date: , 2015
Subject: Breach of Contract Muscadine Grapes
Mediation Memorandum
and manufacturers often want to be assured that their customers will purchase some minimum
quantities of their products. Customers are sometimes willing to commit to a level of guaranteed
purchases”(Stieglitz, 2000). While the contract has been fair for both parties now the muscadine
grape company is trying to breach our previous contract because other companies have come
forward with more lucrative offers.
Legal Issues
There are many potential legal issues stemming from this case. The most
important one that I think the grape company will try to use so that they can back out of
their obligations is that fact that the son signed the contract. I would dispute the fact that
the contract isn’t binding because even though the son is not the owner of the company
he presented himself to me as though he had the authority to make those types of
decisions. “Apparent authority is established if the principal by words or conduct
represents that the agent is authorized to act and a third party relies on such
representation without notice of the agents lack of authority”(Woan, 2014). Now I was
aware that this was not the owner of the company but I knew this was his son and when I
presented the contract to him he agreed to it without much hesitation and signed it. If he
wasn’t authorized to sign the contract he shouldn’t have implied to me that he was and I
would have taken the contract to his father myself.
Requested Remedies
My main concern is not losing my business due to the grape company feeling as though
they can get a better deal from another business. I’m requesting an injunction against the grape
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Mediation Memorandum
company so that they will be stopped from reneging on our previous contract as well as to insure
that they cant take on another contract that might prove to be detrimental to my future business
dealings. If a injunction isn’t possible I would like to receive damages to help offset the potential
loss of future profits because the muscadine grape is a very popular product at the current
moment. “In the event of breach expectation damages compensate the breached-against party for
the profit that he or she would have made had breach not occurred, given his or
her actual investment decision”(Zhang, 2011). I also would like to request that the grape
company help me find new potential partners in the event that our business relationship can’t be
recovered. The only requirement I have for this is that the new providers have equal or greater
quality at an equal price point.
At the end of the day my main goal is to maintain my current requirements contract with
grape company. I honestly don’t wish to be greedy and I believe that our current agreement puts
us in a position that allows both of our companies to make a large amount of profit and remain
successful. The customers that come to my store have become accustomed to the quality that the
grape company has given us for quite some time and I’m worried that any new provider won’t be
able to provide my business with the same kind of product. I don’t possess any malicious intent
and do not wish to punish their company if I do not have to. My only concern is my business and
any damages that might be paid are only to recover from the potential business losses I would
incur if this partnership were to end.
Conditions for potential settlements
There are only two ways that I would allow the grape company to back out of our
prior deal without any consequences.The first potential solution would be the grape
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Mediation Memorandum
company finding a comparable distributor that would allow me to pay comparable rates
to what I have previously been paying in this current contract. The second and probably
most desirable of the options would involve our two companies becoming full fledged
partners. I believe this would allow us to remain profitable and reap the benefits of the
exploding popularity of the grap.
Truth be told if we could meet in a neutral place and talk about our issues and find
what is in the best interest of our companies I believe this issue could be put to rest
without the courts having to become involved. In 1 Thessalonians 5:15(2011) it states,
“See that no one repays anyone evil for evil, but always seek to do good to one another
and to everyone”.I don’t want to be an evil or coniving person I just want what I feel is
fair. I honestly feel that if this grapes popularity hadn’t exploded ,and there werent
potentially more lucrative options the grape company wouldn’t have an issues with our
contract. I have no issue with hearing how the grape company feels about the situation
but if I am going to be able to listen to them they also must be able to listen to me. If
they’re not able to compromise then we will have no choice but to move forward and let
the courts decide whos right and whos wrong. If we can come together and have
meaningful dialouge I believe we can come up with a resolution that works for both
parties.
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Mediation Memorandum
References
Stieglitz, V. (2000). The requirements contract that isn't. Defense Counsel Journal, 67(3), 403-405.
Retrieved from http://ezproxy.liberty.edu:2048/login?
url=http://search.proquest.com/docview/220669079?accountid=12085
Woan, L. P. (2014). Apparent Authority of the Unauthorised Agent; Kelly v Fraser, The Case Notes and
Comments. Singapore Academy of Law Journal, 26, 258-268.
Zhang, F. (2011). Dynamic Contract Breach. Law Economics and Organization, 27(3), 453-484.
Retrieved from http://jleo.oxfordjournals.org.ezproxy.liberty.edu:2048/content/27/3/453.full?
sid=2c0f8955-952b-4f0f-bbbf-a6797ef5a31e
1 Thessalonians 5:15 (2011) Retrieved by
https://www.biblegateway.com/passage/?search=1+Thessalonians+5&version=KJV
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