Case: Sandy, a baker, enters into a written and signed contract with Perry, a freelance purchase representative specializing in sweetener products, to purchase at least 1,000 kilograms of good quality sugar every month at the lowest price possible. Perry gets paid a commission on the amount of sugar purchased, and has authority to enter into contracts with a total value of $2,000 or less on Sandys behalf. Contracts valued at more than $2,000 require Sandys approval that is, an additional signature from her on the contract. The following month, Perry signs a contract with Ryan to purchase 2,000 kilograms of sugar for Sandy at a total price of $2,400, to be delivered two days later. Perry informs Ryan that he will need to obtain Sandys signature on this contract - pointing to the line where she is supposed to sign on the contract, but assures him that this is a mere formality. When Perry asks Sandy to sign the contract, she refuses, even though the contract benefits her business. Sandy actually plans to visit Ryan herself later on to finalize the contract without involving Perry. Confused by Sandys refusal to sign the contract, Perry starts to question whether Sandy is fully paying him the amounts owed to him under their contract. Busy with a large order her bakery has received, Sandy forgets about the contract with Ryan and thus, does not actually visit Ryan to finalize the contract. When Ryan delivers the sugar two days later, Sandy refuses to accept the delivery due to a decline in the price of sugar, and tells Ryan that she is not liable on the contract, since the contract needed her signature. Ryan argues that he believed that she was bound by the contract, since Perry assured him that her signature is just a formality. Two months later, Sandy enters into a written and signed contract with Lisa, a flour supplier, in which Lisa agrees to supply all the flour Sandy needs for her bakery. Lisa must deliver within two days of any order. The contract specifies that December is the most profitable time of the year, and that, during that month, time is of the essence. The contract also stipulates that any late delivery will require an automatic payment of $22,000 in damages by Lisa. During the following months (but never in December), Lisa frequently makes deliveries three or four days after Sandys order, and Sandy accepts them without saying anything. In December, Monica approaches Sandy, saying that she is interested in buying all the pastries for her coffee shop from Sandy. However, Monica makes a test order first, which she expects to be delivered after four days. This contract will bring $5,000 in profits for Sandy. As a result, Sandy orders 2,000 kilograms of flour from Lisa, and Lisa does not deliver within two days. The next day (i.e. three days later), Sandy calls Lisa and demands delivery of the flour as per the contract. Lisa tells Sandy that it will be delivered tomorrow, and so Sandy, anxious about the test order, tries to find flour from other suppliers with no success. Lisa delivers the flour the next day, making Sandy unable to complete the test order and to secure the ongoing contract with Monica. Sandy refuses to accept and pay for the flour, terminates the contract with Lisa, and decides to sue Lisa. While closing the books for the 2020 fiscal year, Sandy notices that her bakery has been significantly impacted by the COVID 19 pandemic, that it is not profitable for her to stay in business, and that she is no longer able to repay her debts. Sandy decides to file for a Chapter 7 bankruptcy, which is approved by the bankruptcy court on February 28th, 2021. The automatic stay comes into effect and a trustee is appointed. The bankruptcy trustee discovers that the last payment Sandy was able to make was for $50,000 a month ago to Magic Milk Co., a supplier and an unsecured creditor, whose owner insisted on receiving its previous 6 months payments before any new orders would be taken. Sandys bakerys only assets are its business premises worth $550,000 and equipment worth $250,000 (which includes the bakerys ovens, worth $150,000). Its bankruptcy filing lists three additional secured creditors: Alpha Bank, which has provided a loan of $500,000 on January 15th, 2019, secured by a mortgage on Sandys bakery building, which is properly recorded; Beta Bank, which has provided a loan of $300,000 on May 10th, 2019, secured by all equipment, presently owned and future acquired, and with a financing statement filed on May 20th, 2019; and Optimal Ovens Co., which is owed $150,000 on account of new ovens sold to Sandys bakery on December 12th, 2019 to be paid for in installments, over which Optimal Ovens has a security interest and has a financing statement filed on December 15th, 2019.

Discuss, using the IRAC method:

(i) Whether Perry can sue Sandy for refusing to sign the contract with Ryan and pay Perry his commission;

(ii) Whether the contract formed between Perry and Ryan can be enforced by Ryan against Sandy;

(iii) Whether Sandy can terminate her contract with Lisa and sue her for damages, and if so, in what amounts; and,

(iv) Whether the trustee in bankruptcy can recover any assets for the estate, as well as well as which creditors will be paid, how much they will be paid, and in which order (assume that the assets and debts listed by Sandy are all valid and the amounts are correctly stated).