Apply: Alternative Dispute Resolution (ADR), Ethics and Risk Management Study Th
ID: 422632 • Letter: A
Question
Apply: Alternative Dispute Resolution (ADR), Ethics and Risk Management Study
The purpose of this assignment is to analyze and select an appropriate method of alternative dispute resolution (ADR) for a business dispute, to examine unethical business behavior, and to develop risk management procedures to avoid or reduce claims and litigation.
Read the following scenario:
Dazzling Dough Co. sells pizza dough to local pizza restaurants. Most of the restaurants buy at least 150 pounds of pizza dough from Dazzling Dough Co. in each order. Jerry's Pizza contacted Dazzling Dough Co. to purchase 200 pounds of pizza dough, along with some other items. Dazzling Dough Co. sent Jerry's Pizza a written contract, prepared by Dazzling Dough Co.'s lawyer, stating that "Jerry's Pizza agrees to purchase 200 pounds of pizza dough, pizza toppings, desserts and soft drinks for $30,000." Jerry's Pizza signed and returned the contract.
A few days later, Dazzling Dough Co. sent Jerry's Pizza 125 pounds of pizza dough and 75 pounds of pizza toppings, desserts, and soft drinks. Jerry's Pizza contacted Dazzling Dough Co. about the error in the contract and demanded an extra 75 pounds of pizza dough. Dazzling Dough Co. said there was no error, that Jerry's Pizza signed the contract so they agreed to the terms, and it was not sending the extra pizza dough.
After several attempts to resolve the dispute and a pressing need for dough, Jerry's Pizza terminated the contract and sent Dazzling Dough Co. a check for $15,000 for the 125 pounds of pizza dough, pizza toppings, desserts and soft drinks. Jerry's Pizza immediately purchased 75 pounds of pizza dough from another company for $12,000. Both parties are threatening to sue each other for breach of contract. They prefer to resolve the dispute out of court because the contract contains a clause that awards reimbursement of attorney's fees to the winning party.
The board of directors of Jerry's Pizza scheduled a meeting with you and other senior management at the company to discuss the dispute. You'll need to prepare a strategic plan overview (an abbreviated strategic plan, not a full plan) for the board that explains why there is a dispute, suggests various settlement proposals, and provides recommendations on how Jerry's Pizza can avoid this kind of dispute in the future.
Prepare a 525- to 875-word strategic plan overview to resolve the legal dispute for the board (use the bullet point headings provided below to format your overview) addressing the following:
Summary of Dispute
Identify the source of the dispute.
Identify each party's interpretation of the contract language.
Identify whether each party's interpretation is reasonable.
Identify any missing facts that would be helpful to know in order to resolve the dispute.
Proposed Revisions to Contract Language
Recommend specific revisions to the contract's language so that it is clear what Jerry's Pizza expected to buy and what Dazzling Dough Co. is required to deliver.
Ethical Considerations
Explain the ethical considerations for a company to enforce specific terms of a contract against another company if the other company is mistaken about what was agreed to. Discuss the factors that should be considered.
Recommendations
Two to three possible settlement options (e.g., pay for the disputed dough, reduce the amount of dough to be purchased, split the difference, refuse to pay, etc.)
Two to three methods of dispute resolution (e.g., negotiation, mediation, arbitration, litigation, etc.) that Jerry's Pizza can propose to Dazzling Dough Co.
Create a one-page visualization to represent the information you provide in this assignment.
Use the Table, SmartArt, or Chart visual representation options available in Microsoft® Word by clicking on the Insert tab located on the ribbon at the top of the window. Locate the Word Help function in the version of Microsoft® Word that is installed on your computer for assistance.
Explanation / Answer
Summary Of A Dispute:
As per the contract, Jerry Pizza signs a deal with Dazzling Dough Co. for purchasing 200 pounds of pizza dough and some other items including pizza toppings, desserts and soft drinks for $30,000. Post agreement Dazzling Dough Co. sent 125 Pounds of pizza and 75 pounds of other items mentioned in order, as per Jerry Pizza order they received from Dazzling Dough was not in accrodance with contract.
Source of the Dispute:
Contract language was the source of the dispute. Lawyer of the Dazzling Dough sent aggrement to jerry pizza stating that "Jerry's Pizza agrees to purchase 200 pounds of pizza dough, pizza toppings, desserts and soft drinks for $30,000." This was misunderstood by both parties. According to Dazzling Dough, Jerry Pizza placed an order of total of 200 pounds including pizza and other items in which quanity of each item was not specified.
Each Party Interpretation of the contract language:
Contract statement is the major reason of dispute between dazzling dough and jerry pizza. Both parties have build different perception of the contract statement. As per Dazzling Dough, Jerry Pizza have agreed to purchase total order of 200 Pounds in which quanity of each item was not specified.
According to Jerry Pizza they have signed an agreement to buy 200 Pounds of Pizza Dough along with other items including Pizza Toppings, Desserts and soft drinks.
Identify whether each party's interpretation is reasonable.
As per the contract both the parties interpretation was reasonable on their ends. Contract Statement has created misconception for both the parties which resulted in the dispute between buyer and seller. In this situtation both the parties have contradiction rights on each other.
Identify any missing facts that would be helpful to know in order to resolve the dispute.
Amendments in contract language is the way for resolving or avoiding such disputes. On one end Dazzling Dough Lawyer should have specified the items and quantity of which Jerry Pizza
signed an agreement for. On the other end, Jerry Pizza should have objected the contract when they received it from Dazzling Dough stating incomplete order information and should not have signed and return it back to Dazzling Dough.
As both the parties preferred to resolve this dispute out of court, so they should follow Alternative Dispute Resolution (ADR) procedure without litigation such as arbitration, mediation or negotiation.
Following an alternative option, Jerry Pizza ended the contract with Dazzling Dough after paying $15,000 for 125 Pounds of Pizza Dough and 75 Pounds of other items. This was appropriate step as they purchased remaining 75 Pounds of Pizza Dough worth Rs $12,000 from other company and Dazzling Dough should cooperate in this case as the contract written by their lawyer was missing complete order details.
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