Final Paper: Essential Elements of an Enforceable Contract

Acme Fireworks Framework
Name
Institution
Acme Fireworks Framework
In recent days, Acme Fireworks has entered in a deal with several large businesses that want the company to supply them with large repeat orders. For this to be possible, there is need to conduct an assessment to determine whether Acme Fireworks is capable of servicing those orders and what needs to be done in order to fulfill such big numbers. The word of mouth agreement arrived at between the owner and the retailers needs to be appraised to establish whether it fits the category of an enforceable agreement. Meeting these new orders means that the overall workload that the company has to deal with will go high and this will demand that the organization hires new staff to deal with the extra workload. Due to the retail presence, the company may also be forced to alter its business entity status to minimize the company liability. At the present, the company only manufactures and sells the fireworks but it does not have to set them up. Even as the company hires new staff, it will need to come up with a formula that allows it to adjust once the volume goes down. This paper will analyze these issues to determine if there is an existent contract as well as what will be the most excellent solutions to meet the new workload as well as all the emerging liabilities.
The proprietor of Acme Fireworks has gotten different proposals by big retailers who want to start purchasing the company’s products. He has agreed to this proposal and indicated that he is capable of making the deliveries in good time. The two parties have arrived at an agreement that they are content with the agreement including the price. The most important thing now is to determine if this agreement captures the basic tenets of a contract that are set out in law (Zafar, 2013).
For a contract to be binding, it has to have five components namely the offer, acceptance, consideration, legality and capacity. The talk that the owner had with the large retailers is the starting point of the contract. The retailers approached him with the promise of buying his fireworks in large quantities. The retailers even went ahead to strike a deal on the total cost of the fireworks per unit and this is considered to be the consideration for the contract. The owner indicated that he had the capacity to service their recurring orders which is an indication of acceptance of the offer. Given that the selling of the fireworks to these new customers is a legal transaction and it is clear that the two parties have capacity (Zafar, 2013). From every indication, this is a binding contract but is nullified by the UCC statute of frauds which indicates that all contracts between traders that exceed $500 needs to be put down in writing. The statute of frauds makes some exemptions to this rule especially on the area of manufactured products or the admission to a court of law on the existence of an oral contract. The other exemption is in the case of partially accomplished contracts as well as the case where there is a memo detailing the absence of a written contract. Considering that fireworks are specially manufactured goods and not widespread, this would be termed as a legally binding contract (Blount Law, 2015). Si...