Issues Regarding Contracts

Essay by shksprsysUniversity, Bachelor'sA+, February 2005

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Issues Regarding Contracts

This summary includes vital information concerning issues regarding contracts, for informational purposes relating to that of an idea presented to the City Council, by the Mayor of Bigtown, to create an advertising campaign staging a false auction on eBay of the City of Bigtown, in hopes to boost tourism rates. Background information involving similar circumstances would be that of Leonard vs. PepsiCo (1999). In short, PepsiCo thought no one would take them seriously when they offered to give away a Harrier Jet, worth approximately $23 million dollars, in their televised advertising campaign for purchasing Pepsi products. They were wrong, considering a man by the name of John D.R. Leonard took the joke to heart, and went about collecting/purchasing the required points for the jet. When PepsiCo did not honor his wishes of giving him the jet, he took them to court.

Mr. Leonard lost his case, based off of the fact that first and foremost, an advertisement is not a contract; it is merely an offer to purchase products.

Secondly, per the Objective Reasonable Person Standard, stated by Kimba M. Wood, District Judge for the United States District Court, Southern District of New York (1999), "In evaluating the commercial, the Court must not consider defendant's subjective intent in making the commercial, or plaintiff's subjective view of what the commercial offered, but what an objective, reasonable person would have understood the commercial to convey." Meaning, that if in general, a person would view the commercial as a joke, then there is no implied contractual obligation.

To address the first reason in greater detail, it is important to know what a valid contract consists of, and it must be stated that wording of contracts will change depending on State, and County laws. The four basic requirements for a contract...