Project 3: Contract Law
Department of Business, Southern New Hampshire University
BUS-206: Business Law I
2
Project 3: Contract Law
The Friendly Dawg and Landlord Lou
A contract must contain four elements to be considered valid. The contract must contain
an agreement, which is an offer made by one party, the offeror, and an acceptance of the offer by
another party, the offeree (Kubasek, N.L. et al., 2020). In the case of The Friendly Dawg and
landlord Lou, this is the offer for lease of property extended by Lou to Dave, the owner of The
Friendly Dawg. Dave accepts this offer by paying his rent of $500 on time, every month. The
next element required for a valid contract is consideration, which is what each party will receive
for their promise under the contract (Kubasek, N.L. et al., 2020). In the contract between Lou
and Dave, these would be the obligations Lou must meet as the landlord for the property, such as
maintenance and repairs to equipment on the property. The third element of a valid contract is
contractual capacity or the legal ability to enter into a binding agreement (Kubasek, N.L. et al.,
2020). Both Dave and Lou are of sound mind and are over the age of majority and therefore are
legally capable of entering into this contract. The final element of a valid contract is legal object
which means that the to be enforceable, the contract cannot be either illegal or against a public
policy. The contract between Dave and Lou does not cover illegal acts and falls within public
policy.
Given the elements required for a contract above, Dave and Lou have entered into a legal
agreement and are both obligated to uphold their part of the contract details. Lou believes that he
should not have to pay rent on his property because the A/C equipment did not properly cool the
back area of his shop where he kept live animals. Unfortunately, this is not within the details of
the contract that Dave and Lou had agreed to. The contract does include coverage for repair of
the A/C equipment if it had failed but it did not cover the upgrade of the unit to meet Dave's
needs for keeping live animals. While Dave is an exemplary tenant by paying his rent on time.
and bringing in a substantiable customer base, he did not disclose the details of his inventory
expansion to Lou. His employee acted as an agent to the business and informed Lou that they
would be expanding their physical location to accommodate their needs. Lou allowed the
company to expand but was unaware that The Friendly Dawg would now keep wild animals
within the property.
Dave does pay more in rent each month and should have the right to renovate his
property if not explicitly stated in his contract that he cannot. Lou and Dave should review the
renovations that The Friendly Dawg is planning for and should be accepted by Lou so that