Breach Of Contract Lawsuit By Hospital On Imaging Company

Question

You are the Hospital Administrator of Jefferson Hospital. Over lunch, the President of Imaging Company offers to sell Jefferson Hospital a piece of fully depreciated magnetic resonance imaging equipment for $450. You know that this is less than the fair market value of the equipment. You tell the President of Imaging Company that you will buy it, and you shake on it. The Imaging Company President later changes his mind and decides to keep the equipment. Jefferson Hospital sues Imaging Company for breach of contract.

a)    Is your oral agreement an enforceable contract? Explain why or why not.
b)    Assuming that the contract is enforceable, what remedies could Jefferson Hospital seek in a lawsuit?
c)    Imaging Company defends on the grounds that the equipment is really worth $25,000, something the President of Imaging Company did not realize at lunch but which you, as the Hospital Administrator of Jefferson Hospital, knew, making the contract too unfair to enforce. Is this a viable defense? Why or why not? Be sure to use the analytical tools described in the lesson.
d)    Assume the same facts regarding the initial meeting, but the Imaging Company owner goes back to Imaging Company and finds that the equipment has been sold to someone else. Jefferson Hospital sues Imaging Company for breach of contract. What defenses could Imaging Company raise? Would Jefferson Hospital win the lawsuit?
e)    Assume the same facts but the Imaging Company President consumed four martinis at lunch. Imaging Company defends on the grounds that the Imaging Company President was intoxicated and incapable of understanding what he was doing. Is this a viable defense? Why or why not?

Summary

The question belongs to Law and it discusses about a scenario where a hospital sues an imaging company which offers to sell an MRI machine at very low cost and refuses to sell it later on. The solution discusses the impact of this scenario in detail.

Total Word Count 878

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