Nelson Ltd is a publisher, specializing in producing fictional textbooks. In Jan

Question

Nelson Ltd is a publisher, specializing in producing fictional textbooks. In January 2018, they decided to produce a new edition of a particular book and commissioned Hilary and Donald to produce the work. Hilary was to provide the text and Donald was to produce the extensive diagrams and each of them was to be paid $25,000. The contract entered into between Nelson Ltd and Hilary required the text to be produced by 30th April 2017 and the terms of Donald’s contract required the diagrams to be submitted by 30th June 2017. In March 2017, Hilary informed Nelson Ltd that she would not supply the finished text on time, unless Nelson Ltd increased her payment by $5,000. Nelson Ltd agreed to the increase, but when Hilary submitted her invoice on delivering the text, Nelson Ltd refused to pay the additional amount. In May 2017, Donald informed Nelson Ltd that he was no longer willing to produce the diagrams for the book. Nelson Ltd however, can get someone else to produce the diagrams, but given the time lost, they will have to pay an additional $1,500 to produce the diagrams on time for printing the textbook as originally planned.

Required: In the context of the law of contract, advise: (a) what action Hilary can take against Nelson Ltd to enforce the additional payment; Can Nelson Ltd take any actions against Donald for his failure to produce the diagram as agreed?

Explanation / Answer

Answer:

In the context of the law of contract, Hilary can take below actions against Nelson Ltd to enforce the additional payment as below

·       Hilary can ask the reason for not paying her the additional amount as Nelson agreed and asks Nelson to pay her her additional amount as per invoice submitted.

·       If not, then Hilary can reach to court for legal action, as both of them had agreement for the increased rate for Hilary.

·       The lawsuit will help Hilary to provide her the additional payment as per the agreed contract terms.

·       The increased contract rate was agreed by both Hilary and Nelson, so court hearing will be favoring Hilary and she will get the additional pay for her work.

Nelson Ltd can take actions against Donald for his failure to produce the diagram as agreed as below

·       Donald and nelson had a contract to provide the pictures by 30th June, so Donald had to provide as per his contract terms.

·       If not, then Nelson may reach to court and raise the law suit against Donald for not meeting the contract terms.

·       The court hearing will be in favor of Nelson Ltd, as the hearing will be as per agreed contract tersm.   

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