Bob decides that he wants the toys and calls you to set up a meeting to discuss the price and to examine the collection of toys to make sure they are in excellent shape.
On October 4th, you meet at a local restaurant whereupon Bob examines the toys, which are up to his standards. You offer to sell them to him for $750.00. Bob scoffs and offers $650.00. Although you are a bit frustrated with his counteroffer, you remember that you really need the money so you offer $725.00. Bob grumbles and increases his offer by a mere $10 to $660.00. He claims he will not pay a penny more. You lower your price to $720.00 and inform him that this is your best, final offer.
Bob states that he will not pay that price and departs the restaurant. Feeling defeated you collect your toys and go home. As you walk home, you wonder if you should have continued the negotiation and gone lower seeing that $700 is your goal price.
On October 13th, you get a call from Bob. It turns out that he combed the entire Internet and can’t seem to find a set that is complete like the one you are offering. Sounding a little bashful, Bob offers to pay you $700.00 for the set. Just to toy with Bob a bit, you provide a price of $710.00. After hesitating for a few moment, Bob accepts.
You mutually agree that you will meet at noon on October 17th back at the restaurant that you met the previous week. You make a stipulation that you want payment to be in cash, particularly smaller bills.
Based on the information from the worksheet from last week, you are to build a formal, written contract. You will need to include:
- Parties – The names and addresses of all the contracting parties should be clearly stated. You can make these up for this contract.
- Dates – List the date that the contract is being entered into.
- Definitions and Interpretations – If there are any defined terms in the contract, this section should provide specific and clear definitions.
- Payment Provisions – The exact price to be paid for the goods or services provided and the date or dates for payment to be made should be clearly set out. Remember, you want cash and not a check or credit card for this contract.
- A specific description of the set of toys should be stated in this section.
- Term of contract – The length of the contract should be stated and it should also be noted whether there are any options to continue the contract. This is a contract for this specific instance and should be noted in the contract.
- Limitation of liability – This section caps the liability of either party to the contract. For example, Mr. Barker has inspected the set of toys and accepts them “as is.” If he finds a defect with them at a later date, you have no further responsibility to him.
- Signature Lines – Provide proper signature and date lines at the conclusion of the contract for both parties.
Besides including the above list and the standard elements of a contract, you are to also include the following clauses into your formal, written contract between you and Mr. Barker:
- A Mandated Alternative Dispute clause.
- Act of God/ Force Majeure Clause in case the toys are destroyed by a natural disaster.