2105AFE Business Law Assignment

Hypoyhetical Problem

Answer the following question using the Issue, Law, Application of Law and Conclusion (ILAC) format.

Adam Hues owns and runs a successful café and catering business, Café Express, in the heart of Valley, Brisbane. He is tired of working long hours and decides to sell Café Express. Adam contacts Williams and Associates Real Estate Agents to arrange the sale of the business. Williams and Associates place an advertisement in the local newspaper advertising Café Express for sale. The advertisement reads:

Stephanie Brown, a close family friend of Adam, notices the advertisement in the newspaper and telephones Adam directly. Stephanie, knowing that Adam is fed up with running the restaurant and he wants to leave the hospitality industry, offers to purchase Café Express for $300,000. As Stephanie’s offer is $50,000 below the minimum asking price, Adam is hesitant to accept the offer. Stephanie tells Adam to think about her offer and to reply to her via phone or email at the end of the week, but no later than the coming Saturday at 5.00pm.

On Wednesday morning, Adam emails Stephanie advising her that he is willing to sell Café Express to her for $300,000. Stephanie reads the email and decides to phone Adam on Wednesday night to thank him for accepting her offer.

On Wednesday afternoon, Brad Williams from the Real Estate Agency contacts Adam and informs him that a businessman, Conrad Jones has provided a written offer to purchase Café Express for $400,000. Brad tells Adam to accept the offer on his behalf.

Adam immediately phones Stephanie and tells her to disregard the email that he had sent her earlier that day. Stephanie is very angry and believes that she has formed a legally binding contract with Adam.

Advise Stephanie and Adam as to whether they have formed a legally enforceable contract. Discuss your answer with reference to the law of contract only.