Royal Hotel Inc. verbally orders 100 sets of sheets and pillowcases, each to be embroidered with the chain’s coronet logo, for $1,000, from Textile Inc. Textile starts on the order and has completed 45 sets when Royal calls back and cancels the order. Which of the following is true? (Points : 1)
None.
Your school subject is not the name of your school.
The contract is fully enforceable; this is the specially manufactured goods exception to the Statute of Frauds.
The remaining 55 sets of sheets and pillowcases were not yet completed by Textile Inc.
The statement "Textile is entitled to the full contract price of $1,000" is NOT true.
To determine the correct answer, we need to understand the legal concept of a contract and its implications.
In this scenario, Royal Hotel Inc. verbally orders 100 sets of sheets and pillowcases from Textile Inc. There is no mention of a written contract.
In most jurisdictions, verbal contracts are considered legally binding, but they can be more challenging to enforce as compared to written contracts. Typically, to be enforceable, a contract must have the following elements: offer, acceptance, consideration (something of value exchanged), and mutual intent to be bound by the terms.
However, it's important to note that each jurisdiction may have specific laws and regulations regarding verbal contracts. Therefore, it is advisable to consult legal counsel and consider the laws applicable in your jurisdiction.
In this case, Textile Inc. started working on the order and completed 45 sets before Royal Hotel Inc. canceled the order. The cancellation of the order may have several legal implications, depending on the circumstances and the nature of the agreement between the parties.
Typically, canceling an order before completion may lead to discussions around compensation for the work already performed. Textile Inc. may be entitled to reimbursement for the expenses incurred and the value of the completed portion of the order. However, the specific terms of the agreement, as well as any applicable laws and regulations, would govern this situation.
It is unlikely that Textile Inc. would be entitled to the full contract price of $1,000. Instead, they might be entitled to payment for the completed portion of the work or compensation for any expenses they incurred.
To navigate this situation, it is essential for both parties to communicate and find a mutually agreeable resolution. This may involve negotiating a partial payment or exploring other options to reach a fair outcome considering the work already performed and any damages suffered by Textile Inc.