Contractual Agreement Memo
I am writing this memorandum to you to explain the events which led to breach of the contract.
One of the most evident ethical issues in the scenario is adoption of a false agreement on the part of Salesman. Buyer was willing to make the earnest payment upon being granted a two extension but Salesperson never requested the same for the client form the seller. Consequently, the seller and Salesperson went ahead and sold the real estate to another client who raised a higher fee for the same. This is quiet unethical because Buyer had not shown any unwillingness to pay a higher sum and alternatively, Salesperson did not communicate to Buyer about the new development.
It was also very unprofessional for Salesperson to ignore the urgency of Buyer in obtaining the written document which had details of the contract (Cortesi, 2003).This scenario calls for action to be taken upon Salesperson so that in the future business deals, he may respect contracts even if they are verbal. This will save customers from the agony of chasing money lost in deals which look dubious. Consequently, the unprofessional behavior portrayed by Salesperson may cost the trust many potential customers (Cortesi, 2003). Salesperson terminated the contract with Buyer because the two day extension expired without receipt of earnest payment from Buyer. This was a breach as they had agreed that the money would be availed by then.
However, Buyer could not present the payment because Salesperson had not availed the written document which had directions of the terms of contract. Therefore, both parties contributed to breach of contract (Allbusiness, 2010). Formalities associated with contracts do not require that they be written at all times such that the agreement between Buyer and Salesperson which was verbal qualified to be called a contract. This makes any agreement to involve into business a contract even if no statement is issued to either party. Legal regulations thus consider any form of agreement as a contract regardless of the situation and business deal at hand (Allbusiness, 2010).During the formation of an agreement and its transformation into a contract, the conditions laid by both parties must be complete so that the agreement may be certain as well as to remove any vagueness that may be clouding the agreement.
In the scenario between Buyer and Salesperson, their agreement was never completed because Salesperson did not present Buyer’s intention for an extension (BNET Editorial, 2010).Legality of the object being sold is another crucial element of any contract such that a potential customer may terminate a contract when they realize that the business deal is illegal. This leads to breach of contract on the part of the customer as they expect the seller to present legal items while in real sense it may not be legally possessed (Allbusiness, 2010).The buyer in this case may involve the services of a lawyer so to carry out the legalities associated with breach of contract. After indulging the services of a lawyer, she may then decide whether to sue the company as a whole or the major participants who were directly involved in the situation (Cortesi, 2003.
Allbusiness (2010), suing for beach of contract. Retrieved on May 18, 2010 from: Allbusiness.com, Inc
BNET Editorial (2010), understanding marketing ethics. Retrieved on May 18, 2010 from: www.marketingpower.com
Cortesi, G. R. (2003), Mastering real estate principles. 4th ed, Dearborn Real Estate.