Essay On Mediation Memorandum

Memorandum

My intent is to provide you with all the necessary information in the case, so that you are fully aware of the details that have contributed to this dispute. It is our preference that this case settle outside of court as soon as possible. We feel that resolving the matter through mediation, rather than litigation, can work to preserve the business relationship between the two parties, while ensuring that the dispute is resolved on mutually agreeable terms.

Facts of the case

I am running a small, local health food store and I was planning to expand the business by offering consumers several additional product lines. A business associate then informed me that I might be interested in Muscadine grapes, which are known for containing a high level of antioxidants. His family had been in viniculture for some time, and he offered me both the product and the company’s marketing services. His business proposal fit with my intention to expand the business, and hence, I was interested in the deal.
When the first set of samples arrived and I previewed the product line, I was quite pleased with the quality of the grapes. Customers were equally impressed when I distributed the samples, and the products quickly gained popularity. As a result, I began placing increasingly large orders of the product and invested significant time and financial resources in an advertising campaign that specifically marketed the Muscadine grapes. The company responded to these increased orders well, providing me with both prompt services and consistent prices.
Invoices, when received, required within 30 days; however, I used to pay them between 45 and 60 days after I was billed. The company was always very willing to work with me, financially, and never charged me any interests or penalties, despite my late payment. Their acts of good faith strengthened our business relationship significantly.
However, in one incidence, I asked the owner’s son to sign a new business contract between my shop and their vineyard, on behalf of the company. The new contract included a price schedule that defined what I would pay on a consistent basis. He did sign the contract, but it was never discussed with or verified by the owner, and his son was a minor at the time that the contract was signed.
When The Huffington Post published an article that outlined the benefits of the Muscadine grapes’ antioxidant qualities, the demand for the grapes skyrocketed. The company from where I was buying these products started receiving increased orders, to such an extent that, the demand exceeded their supply. A particular organization in Texas was even ready to pay double the amount I had contracted to pay for the grapes, in order to receive them in greater supply.
Despite the business’s supply issues, they were no longer able to give me the number of grapes we had agreed to. Instead, they suggested that I contact one of several other suppliers, all of whom they highly recommended, who could offer me similar products. This upset me, because we had a contract, and I expected to continue receiving the agreed upon deliveries of these products at the contract negotiated prices.
At this point, I provided them with a copy of the contract that the owner’s son had signed, which outlined both my delivery and payment schedule. With an implied duty of good faith and fair dealing, the business owner needed to continue providing me with the products assigned to my business by the contract. Since he had initiated a breach of contract, I filed a lawsuit against him, in order to secure my product orders, but I sincerely wish to resolve the matter amicably, and to continue doing business with him.

Contracts at issue

Looking at this case, it seems that, the two parties never entered into a legally binding contract. Any given contract is a business transaction, and can only be considered legally binding when both parties understand that a contract has been formed. More specifically, form a contract is not just a process of writing it and signing a single document, but rather, it involves making an offer, accepting the offer, the key part of consideration, and legal intention (Spigelman, 2011).
So, when one entity offers a contract, the other business entity must agree to the contract’s terms in order for it to become a legal document. Also, the person signing the document must be a legal adult. In this case, the owner’s son was only 17 years old at the time that he signed the document, and his father, the business owner, was never made aware of the contract’s terms. This contradicts the concept that both the entities involved must agree to all the terms and conditions and only then move ahead in the contract because consideration is a must for the formulation of any given contract (Brink, 2009). Further, the intention of both the entities needs to stay ethical in nature, and they need to abide by the laws under any given situation (Douglas, 2008). That was not the case here.
In this case, I only approached the owner’s minor son with the contract, and never spoke to him directly. Hence, the contract was never legally established in the case. It could be argued that I had a personal motive in not taking him the contract, because I wanted to continue to pay his invoices in a period of 45 to 60 days, instead of 30 days. I would also like to mention that the business entity did aid me to give the best quality of Muscadine grapes and his products successfully aided in growing my customer base. Unfortunately, my local produce store no longer fits in with their long term business goals, and they have ceased to provide me with the product they once promised. Despite our agreement, and their historical fulfillment of that agreement, I am no longer receiving the product I order, and as a result I have filed a contractual law-suit against them.

Legal issues

The business entity did receive a big opportunity from the business perspective, and I understand that my small local business no longer fits with their company’s vision of the future. But, I do not understand how, given that they have signed the contract with me, and honored it in previous months, why they are refusing to honor the contract now? They should continue to supply me with the agreed products and services. I thereby, found their intentions less than honorable, and as a result I have outlined several breaches in the business contract with them.

Requested remedies

I would like to settle this dispute without judicial review, through negotiations and a mutual understanding of the facts. I would like to suggest two possible means of resolution in the case. Either the business entity promises to offer me certain quantities of the Muscadine grapes as decided at an agreed upon price, or the business owner needs to be responsible for finding an alternative vendor who can provide my business with similar quality products at a comparable price. Should an alternative vendor be found, I expect that once the business has developed their supplying capacity that they must offer to fulfill the terms of our previous contract from their own supplies, rather than encouraging me to remain with the vendor.

Conditions under which settlement may be achieved

I think that, they may deem the formation of the current contract illegal, which would allow them to file a counter-suit against me. Under such conditions, it is important that we work to prevent any hostility from developing. I would like to talk to the business owner, so that we can negotiate a mutually beneficial solution. I want my business to grow, but I also wish their business well. I do not, however, which that they should prosper at the expense of my growing business. Hence, I would like to find a way that we can agree to continue our business relationships, without lasting animosity.
I would like to continue doing business with them, provided that they agree to supply a reduced, but specific quantity of grapes for an introductory time period. After which, with an increased supply of grapes, they would need to supply me the same quantity of grapes that they did at the onset of our contract. Additionally for easier and more convenient transactions, the payment period should be extended.
Attachment: Contract copy

References

Spigelman, J. J. (2011). Contractual Interpretation: A Comparative Perspective. Australian Law Journal, 85(7), 412.
Brink, A. (2009). Corporate governance and the Companies Act. Management Today, 25, 6.
Douglas, E. E. (2008). Common Law Theory, Cambridge Studies in Philosophy and Law. New York: Cambridge University Press.