Take a position and discuss the formation (or non-formation) of a contract between Mowgli and Kipling, with emphasis on the elements of offer, acceptance, consideration and mutual assent, and things the parties could have done differently to alter the outcome of this situation.”

CONTRACTUAL FORMATION:

1- Mowgli, a sharp businessman, and Kipling, an equally sharp businesswoman, occasionally see each other on the ride to work on the subway. During these rides, they enjoy talking about their respective businesses. After some time, it becomes clear to both of them that Kipling produces widgets she could profitably sell to Mowgli. Mowgli, unknown to Kipling, will be able to repackage and resell these widgets to one of his customers at a handsome profit (if Kipling knew about this customer, she could have sold the widgets directly). As the subway rides continue, they discuss production, colors, sizes, shipment, price, delivery dates, quantities, and other aspects of a sale of widgets by Kipling to Mowgli. Their only communication is during these subway rides.
One day, after having not seen Kipling for a couple of weeks, Mowgli arrives at work to find a shipment of 10,000 widgets has been left on his loading dock. Checking his email, he finds an invoice from Kipling for $10,000 plus shipping costs. Mowgli lets the shipment sit on his loading dock for a week, then inspects some of the widgets, finding that they exactly conform to the discussions he had with Kipling on the subway. Mowgli calls up his customer, only to get a phone message announcing that a bankruptcy had been filed that morning and they were out of business.

“Take a position and discuss the formation (or non-formation) of a contract between Mowgli and Kipling, with emphasis on the elements of offer, acceptance, consideration and mutual assent, and things the parties could have done differently to alter the outcome of this situation.”

Leave a Reply

Fill in your details below or click an icon to log in:

WordPress.com Logo

You are commenting using your WordPress.com account. Log Out /  Change )

Google+ photo

You are commenting using your Google+ account. Log Out /  Change )

Twitter picture

You are commenting using your Twitter account. Log Out /  Change )

Facebook photo

You are commenting using your Facebook account. Log Out /  Change )

Connecting to %s