Unit IV Journal Business Law BUS 3301 Contract Scenario Calvin had been an avid coin collector for many years, and the most valuable coin in his collect
Unit IV Journal Business Law BUS 3301
Contract Scenario
Calvin had been an avid coin collector for many years, and the most valuable coin in his collection was an uncirculated, mint condition, 1943 Lincoln penny made of copper (most pennies made during World War II were made of zinc because copper was needed in the war effort). That penny had a value of between $60,000 and $95,000. In August of 2017, Calvin had a serious stroke that left him unable to speak or walk, but his doctor assured his family that Calvin would recover over time with intensive therapy.
Calvin was a widower and did not have any children, but he had several nephews who visited him from time to time as he recovered. None of the nephews had any real interest in Calvin’s coin collection. One of Calvin’s nephews, Billy, who visited Calvin more often than the other nephews, sometimes listened to Calvin talk (talking was a part of Calvin’s therapy) about his mounting medical bills and his coin collection, but Billy never showed much interest in the medical bills or the coin collection. In October, as Calvin’s recovery progressed slowly, Billy visited Calvin and told Calvin that he had been reading about coin collecting, and he realized that Calvin’s collection, especially the 1943 Lincoln copper penny, was valuable, and Billy suggested that Calvin should consider selling the 1943 Lincoln copper penny and use the proceeds to pay his medical bills. Calvin resisted the idea at first, but Billy continued to urge Calvin to sell the penny so that he would not have to worry about the medical bills. Finally, when Billy told Calvin that he would arrange the sale of the penny for a commission of just 5% of the sale price of the penny, Calvin began to think that selling the coin might be a good idea. He was still a little confused about how the sale would work and what Billy would do to make sure that the penny would be sold for the best price. Calvin told Billy that he thought that the penny was worth almost $100,000, but Billy assured Calvin that the market had changed recently, and that the penny was now worth $40,000 to $45,000. Eventually, Calvin allowed Billy to sell the penny for the best price he could get and to take a 5% commission for arranging the sale of the penny. Billy then sold the penny to a friend for $40,000, took his 5% commission, and paid the remainder of the sale price to Calvin.
A few months later, as Calvin continued to recover, he read a story in a coin collecting magazine about how an uncirculated, mint condition, 1943 Lincoln penny made of copper had just sold at auction for more than $100,000, and Calvin began to wonder if Billy had taken advantage of him. Calvin consulted a lawyer and asked the two questions below.
1. Exhibit 11-1 (on page 239 of the textbook) explains the relevant considerations for mental incapacity. Based on the facts presented, did Calvin have the mental capacity to enter into the contract when he agreed to let Billy sell the penny? ? I have attached it separately as well
2. Page 264 of the textbook poses four questions to analyze when determining undue influence. Based on the facts presented, did Billy exert undue influence over Calvin to cause Calvin to enter into the contract that allowed Billy to sell the penny? I have attached it separately as well
If someone believes undue influence has occurred, asking the following questions can help establish whether there was undue influence:
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1. Was the dominant party rushing the other party to consent? ,,
2. Did the dominant party gain undue enrichment from the agreement?
3. Was the non-dominant party isolated from other advisers at the time of the agreement?
4. Is the contract unreasonable because it overwhelmingly benefits the dominant party?
Your journal entry must be at least two pages in length and include at least two outside sources, one source must be from the CSU Library. Be sure to use APA formatting for all citations and references.