MGT-825-O500 Topic 2 Discussion GCU

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MGT-825-O500 Topic 2 Discussion GCU

Module 2 DQ 1

A successful real estate developer owns property throughout the United States (U.S.). Fab Coffee is a
successful coffee shop that is expanding rapidly throughout the U.S. and wants to purchase a parcel of
property from the developer for a new coffee shop. Fab Coffee establishes a new corporate entity under the
name Coffee Supreme in order to hide its true identity and negotiate the best possible price for the property.
After a lengthy negotiation, with counsel representing both parties, the developer agrees to sell the property
to Coffee Supreme for $1 million in cash. After signing the agreement, but before closing, the developer
discovers that Coffee Supreme is owned by Fab Coffee and refuses to sell the property unless Fab Coffee pays
$2 million. Given the historical and theoretical background of contracts, do the parties have a valid,
enforceable contract? Is it ethical for Fab Coffee to approach this transaction in this manner? Why or why not?
Is it ethical for the developer to attempt to terminate the agreement and ask for more money for the
property? Why or why not?

Module 2 DQ 2

Two friends start a business as a partnership with no agreement governing their rights as business partners.
What are the implications of this decision if the business is successful? What are the implications of this
decision if the business is unsuccessful? Would a written agreement help sustain the business as it develops
over time? Explain.