17-1 Inez has a specific set of plans to build a sailboat. The plans are detaile

Question

17-1 Inez has a specific set of plans to build a sailboat. The plans are detailed, and any boatbuilder can construct the boat. Inez secures bids, and the low bid is made by Whale of A Boat Corp. Inez contracts with Whale to the build the boat for $40,000. Whale then receives unexpected business from elsewhere. To meet the delivery date in the contract with Inez, Whale delegates its obligation to build the boat, without Inez's consent to Quick Brothers, a reputable boat builder. When the boat is ready for delivery Inez learns of the delegation and refuses to accept delivery, even though the boat is built to her specifications. Discuss fully whether Inez is obligated to accept and pay for the boat. Further, would your answer be different if Inez had not had a specific set of plans but had instead contracted with Whale to design and build the boat? Explain.

17-2 As the building services manager for Fulton County, Georgia, Steve Fullard oversaw custodial services. Fullard determined which services to contract for, received the bids, and recommended the selection of a vendor. After the selection of Total Quality Maintenance of Georgia, (TQM) on a particular contract, Fullard supervised TQM's performance and received and processed its invoices. Later, TQM, assigned its unpaid invoices to American Factors of Nashville, Inc., which forwarded copies to Fullard with a statement rubber stamped on each invoice. The statement began with the word "NOTICE" and the name, address, and phone number of American Factors. It also said, "Remittance to to other than American Factors of Nashville, Inc., does not constitute payment of this Invoice". Included with each invoice was a certification by TQM's president that the invoice had been assigned to American Factors. Nevertheless, the county paid TQM on these invoices, and American Factors filed a suit in a Georgia State Court against the county claiming it still owed American Factors. Can the county be required to pay the same invoice twice? Why or why not? See Fulton County vs. American Factors of Nashville, Inc., 551 S.E. 2d 781 (Ga. App. 2001).

Explanation / Answer

17-1 In case of delegated contracts there are three parties the delegator(who originally incurred the obligation to perform the contract), delegatee (the party who later takes the responsibility of performing the contract ), and the debtor (who is the contracting party opposite delegator).

In delegated contract cases the contract stands null and void when there is a threat to the fulfillment of the contract commercially. For example when the contract is to be performed specifically as per certain specifications then if the contract is not performed up to the specifications and there is a possibility of non performance then such contracts stand void.

In the above case if the boat constructed by Quick Brothers is not upto the specifications of Inez then the contract would have stood null and void. But in this case the boat constructed by Quick Brothers is exactly how Inez demanded it to be. Had there been any alterations in the specifications the contract would have ended to be null and void.

Even if Inez contracted with Whale to design and build the boat with no specific plan then also it would not have affected the contract between Inez and Whale as the boat to be designed and made needs to be done in time. If that is done the contract stands valid.

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