Obligations Case Study Example | Topics and Well Written Essays - 2000 words

Obligations - Case Study Example In five different examples we shall try to explain complexity of issues that they cover. According to US Senate "obligation is an order placed, contract awarded, service received, or similar transaction during a given period that will require payments during the same or a future period." (US Senate reference glossary) Bravo Shearing Ltd (BSL) are manufacturers of tube cutting machinery and have advised in Tube World their latest tube shear at 980.000 Laurel and Hardy Ltd (LH) are manufacturers of welded stainless steel tubing and on seeing the advertisement request further information from BSL, who send a brochure complete with price list. On the price list the shear is listed is listed at 900.000. L&H dispatch a letter stating that they wish to purchase the shear for the list price. BSL have now contacted L&H and advised them that the price in the list is incorrect and that the correct price is 980.000 L&H insist that they have a contract at 900.000 Commercial ads are not considered valid offers, same as general price lists. Obligational offer is document which is obligational for the seller of the product. "There are also obligations in other normative contexts, such as obligations of etiquette, social obligations, and possibly the obligation to spell words correctly" (Law Dictionary and Research guide). On the other hand, if price list is sent specifically on request of potential customer requesting the offer for specific product, than it can be considered as valid offer, and at that moment mailer of the offer or price list has become obligatory document. Therefore, L&H has right to buy tube shear for 900.000 EXAMPLE 2 Dispute L&H have made an offer to PW Metals for the sale of 500 lengths of tube at a price of 1.85/meter. PW Metals have faxed back asking if L&H "may accept a price of 1.80/meter."L&H did not respond, and a week later sold the material to Premier Ltd. PW Metals have now contacted L&H requesting a delivery date for the tubes. Solution PW Metals are right when claiming that they have valid contract for delivery of 500 lengths of tube at price of 1.85/meter, unless that date of validity expiration has been clearly stated on the offer that has been sent by L&H, AND that validity period has expired on the moment when PW requested delivery date for the tubes. The fact that PW Metals asked for price reduction does not have any effect on the validity of previous offer. EXAMPLE 3 Dispute L&H have made an offer by fax machine for 100 lengths of tube to Whitehouse Stockings Ltd (WSL) at 2.30 pm on Monday, 19th of November. After consideration WSL decide to take up the offer and fax back an acceptance at 5.12 pm on the same day, and place a copy of the acceptance in the post that night. Unknown to the either party the fax acceptance falls down a gap in the desk behind the fax machine and is not seen by anyone at L&H. The following morning L&H sell the 100 lengths to Pentagon Steel and there will be no replacements available for several months. At 10 am the post is opened at L&H and they notice the acceptance, upon which they advise WSL of what has happened. WSL claim that they