Legal Environment of Business

Exam 2

Answer any two questions with a short answer NOT to exceed four sentences in length.

Answer the remaining two questions with a well-developed essay.

1) Rowe was admitted to the hospital suffering from a critical illness. He was given emergency treatment and later underwent surgery. On at least four occasions, Rowe’s two sons discussed with the hospital the payment for services to be rendered by the hospital. The first of these four conversations took place that day after Rowe was admitted. The sons informed the treating physician that their father had no financial means but that they themselves would pay for such services. During the other conversations, the sons authorized whatever treatment their father needed, assuring the hospital that they would pay for the services. After Rowe’s discharge, the hospital brought this action against the sons to recover the unpaid bill for the services rendered to their father. Are the sons’ promises to the hospital enforceable?

2) Metal made a contract to design a new earth-moving vehicle for Lamar, Inc. Metal was depending on the genius of Sam, the head of its research department, to design a new vehicle. Shortly after the contract was made, Sam was killed in a horrific gardening accident. Metal was not able to design the vehicle without Sam. Lamar sued Metal for damages and breach. Metal argues their duty to perform was discharged. Are they correct?

3) Anthony promises to pay McCarthy $10,000 if McCarthy reveals to the public that Washington is a communist. Washington is not a communist and never has been. McCarthy successfully persuades the media to report that Washington is a communist and now seeks to recover the $10,000 from Anthony, who refuses to pay. McCarthy initiates a lawsuit against Anthony. What will be the result?

4) Joan, a bedridden, lonely 80 year old woman, owned Greenacre (her family estate) outright. Al, her doctor and friend, visited her weekly and was held to the highest regard by Joan. Joan was terrified of pain and suffering and depended on Al to ease her fears. Several months before her death she sold Greenacre to Al for $5000. The value of the land was well-over $5,000,000. Joan’s two children challenged the validity of the sale of the land to Al. Was it valid?

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