Business Law for Accountants: Overview of the Legal Scenario

Business Law for Accountants
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Abstract
Takem’s Appliances and Electronics is a firm that is operated and owned by Tommy Takem. Recently, a disgruntled client presented Tommy with a letter asserting that the whole deal is unconscionable and for this reason the deal/contract cannot be enforced by the courts. The business model used by the firm is lawful, but the practices utilized to increase business profits are against the law. The salespeople do not tell their customers all the fees and costs linked to the purchase of the company’s products, which is in contravention of the Truth-In-Lending Act that protects consumers when borrowing funds. The arguments presented by Sally Walker in the letter are valid, and are in agreement with the concept of unconscionability. The sort of behavior that Takem’s Appliances and Electronics engaged in is unethical because the company does not treat its customers fairly.

Business Law for Accountants
Contract law indicates that a contract refers to an expressed or written agreement between 2 different parties to offer a service/product. Intrinsically, all business organizations deal with contracts, even though they may be unwritten like most transactions that involve services and goods. When one of the parties to the contract breaks the terms specified in the contract, this act is considered a breach of contract (Stone, 2016). This paper focuses on a specific realistic, hypothetical legal scenario: a scenario involving the client named Takem’s Appliances and Electronics. This is a firm that is operated and owned by Tommy Takem. The paper addresses the questions and prompts presented by the scenario. This essay focuses on the concept of unconscionability, which is also known as the concept of unfairness, and other statutory legislations. The concept of unconscionability is an integral component of contract law. The essay examines the business model of Takem’s Appliances and Electronics from both a legal and moral/ethical perspective.
Overview of the Legal Scenario
Located in the rural region of Southwest Virginia, Takem’s Appliances and Electronics is a company that faces little competition. For this reason, the owner charges an estimated 10 to 20 percent more than many other retailers. The vast majority of its clientele is poor people who live in the Appalachian areas of Virginia, West Virginia, Kentucky and Tennessee (Sopeju, 2015). Of late, the firm started selling electronics and appliances door-to-door, and since Tommy is delivering a service to the people by bringing the products to their homes, he increases the costs by roughly thirty percent so that the customers pay more than they would have paid if they had visited the store to buy them (Sopeju, 2015).
Moreover, given that most of the firm’s clients are people who are unsophisticated, moderately untutored, economically underprivileged, and have poor credit, Takem’s Appliances and Electronics provides financing for most of their sales and charges the customers an application fee of 15%, plus the highest interest rate permitted by law (Sopeju, 2015). Not so long ago, the company’s owner was presented with a lette...