Takem's Appliances And Electronics Case Summary

Takem’s Appliances
The case in question looks at Takem’s Appliances and Electronics, LLC which services poorer residents of the Appalachian regions of Virginia, Tennessee, Kentucky, and West Virginia facing little competition in the region. Due to the lack of competitors, Takem’s charges 10-20% more than retailers in the area and 30% more for delivery of products. Takem’s also finances the majority of sales as a result of an uneducated customer base with poor credit histories. Takem’s financial clerk processes the documents signed by the customers and files a financing statement listing the goods sold. Takem’s charges a 15% application fee (the highest rate permitted by law) to complete the financing paperwork.
One customer, Sally Walker, has
Contracts form obligations that are enforceable by law and include the four main components of mutual assent, consideration, capacity, and legality. “In order for a contract to be legally enforceable, it must have been freely entered into by the parties” and furthermore “capacity, undue influence, duress and unconscionability deny enforcement if the free will of a party has been overborne” (Spann, 1988). Besides contract law, it also makes sense to look at the Uniform Commercial Code (UCC) and how it relates to this case. Contracts for goods, as in this situation, are governed by statutory law. The UCC is the statutory law that governs the sales of goods. Under Article 2 of the UCC, all sales over $500 must be in writing. This is also a bilateral contract where Takem’s has promised the delivery of a good (computer) in return for payments and fees. Takem’s has delivered on their part of the contract and Sally Walker is now threatening to stop fulfilling her side of the contract by ending payments. The contract is an express contract in which both parties have “knowingly and intentionally agreed on the promises and performances (Custom Text, 2017). There is no information in the prompt to think that Ms. Walker was not informed of all costs, at least in writing for the bill of sale if not by the salespeople. It is also given that the customer signs all
The question is between agreement and non-agreement and the law clearly favors agreement because non-agreement “embodies coercion and interference with private autonomy” (Spann, 1988). In the law of mutual assent, “parties’ beliefs about contract formation sometimes actually influence case outcomes” (Wilkinson-Ryan & Hoffman, 2015). In the agreement between Takem’s Appliances and Electronics, LLC and Sally Walker, it can be assumed that Ms. Walker had to sign a bill of sale, a security agreement, and a negotiable promissory note according to the prompt. An assumption can also be made that all terms of the agreement were included within these documents. If Ms. Walker signed, which must have been done since the sale was processed, she agreed to the terms. For these reasons, the mutual assent principle appears to have been met. Consideration “Under eighteenth century contract law, consideration consisted of a benefit to the promisor or a detriment to the promisee, and contracts were enforced in order to avoid the unjust enrichment of the promisor or the reliance injury the promisee that would result from non-enforcement. Since the nineteenth century, however, consideration has consisted of a bargained-for exchange-an exchange in which the component promises or performances of the contract induce each other” (Spann,