A number of years ago I was working for a now defunct company called eMachines, Inc. that had operations all over the world, including a small engineering and software programming office in Scotts Valley, California. The decision was made to close the office because the line of products these employees were working on were to be discontinued and there was no longer any need for their services (or to maintain an office in Scotts Valley for that matter).

eMachines terminated the employees and subleased the space (there was a three year term left on the lease). As luck would have it, the CFO for the sublessee, Los Gatos, Inc. called me about a year later and asked if they could terminate the sublease early. With two years left, I spoke with eMachines corporate controller, Larry Downs and asked him how much we had to pay left on the lease. The response I received back was $100,000, which reflected the amount of rent Los Gatos, Inc. had paid to eMachines up to that point - the actual figure I was looking for was $250,000. The error was merely attributable to a mismatch of cells on Microsoft Excel. Larry Downs and I agreed that for an early termination we wanted the full rent with a slight discount. I communicated this message back to the CFO for Los Gatos, Inc. along with the $100,000 figure. The offer was immediately accepted.

A few days later Larry Downs realized his Microsoft Excel error and gave me the correct figure (again, $250,000)

Los Gatos, Inc. is looking to save money and paying $100,000 is obviously less than $250,000. Setting aside issues relating to the Statue of Frauds for this question, is there an enforceable agreement in this situation? If the answer is yes, is there a remedy by which eMachines can use to avoid its purported obligation?

Answer rating: 100% (QA)

Yes there is enforceable contract because according to UCC the contrac... View the full answer