Please write out your responses to the hypo and discuss with the group.

Chapter 16 Case Hypothetical and Ethical Dilemma

Before her recent accident, eighty-two-year-old Lily Ledbetter was her own chauffeur. She used to drive an automobile to fulfill her once-active senior lifestyle, including outings for bridge tournaments, water aerobics, grocery shopping, bill-paying, and family get-togethers. One day, Lily decided to purchase a new automobile. Although her fifty-year-old son Ron suggested that he accompany her to the car dealership, she refused, reminding him that she was fully capable of taking care of her own responsibilities. With the wind of independence at her back, Lily entered the dealership, Bjorn Fjord Motors, alone. After negotiating her best deal and signing a contractfor the purchase of a new Fjord Mastodon sedan, Lily drove away in her rapidly-depreciating asset. Five miles down the road, the steering wheel detached from the steering column (the steering wheel literally came off in her hands) and Lily crashed into a culvert. She sustained severe personal injuries, including (but not limited to) a broken left leg, a broken pelvis, a collapsed lung, and numerous lacerations to her face. Her attending physicians agree that Lily will never be able to drive an automobile again. Lily has since sued Fjord Motors, Inc. (the manufacturer of the sedan) and Bjorn Fjord Motors, Inc. (the dealership) for personal injury. Both companies have filed answers denying liability on the basis of an exculpatory clause included in Lilys purchase contract. The exculpatory clause states that neither Fjord Motor, Inc. nor Bjorn Fjord Motors, Inc. is responsible to a customer or any other third party for a defect in the Fjord Mastodon that results in personal injury and/or economic harm. Both companies have also filed motions for judgment on the pleadings, requesting that the court summarily dismiss both causes of action against Fjord Motors, Inc. and Bjorn Fjord Motors, Inc. on the basis of the contracts exculpatory clause. Should the court grant the defendants requests for judgment on the pleadings? Is the exculpatory clause enforceable against Lily Ledbetter?

Notes:

An exculpatory clause is part of a contract that prevents one party from holding the other party liable for damages related to the contract.

First determine if there is a contact:

1. Offer

2. Acceptance

3. Consideration

4. Legality

5. Capacity

6. Mutuality

Next, examine if there are any things that would render the contact unenforceable? If the contact is unenforceable, then the terms of the agreement (the exculpator clause) does not apply.

Was there a mistake?

Was there a misreprsentation? If so, was it fraudulent, negligent, or innocent? What condition is expected of a new car? Is the condition of the car a material fact? A material fact is a fact that would be important to a reasonable person in deciding whether to engage or not to engage in a particular transaction; an important fact as distinguished from some unimportant or trivial detail.

is the Fjord contract unconscionable? Unconscionability occurs when one party has so much relative bargaining power that he/she effectively dictates terms of contract, resulting in situation where dominated party, in essence, lacks free will. If the Fjord contract is unconscionale, is the contract void?

There can be more than one defense to the enforceability of a contract.

Please write out your responses to the hypo and discuss with the group. There is more than one answer here.