Gerald Was a Subcontractor,bidding on a Contract for XYZ Corp

question 12

Multiple Choice

Gerald was a subcontractor,bidding on a contract for XYZ Corp.,the general contractor.When adding up the total of materials and labor,Gerald's secretary made a clerical error with a total of $45,000 instead of $450,000.Gerald then submitted his bid for $45,000.XYZ accepted Gerald's bid of $45,000,mostly because all the other bids were over $400,000.When Gerald learns of his mistake,he tells XYZ that he cannot perform the contract.If XYZ sues to enforce this contract,what is the most likely result?

• A) The contract is fully enforceable because there was a valid offer and acceptance.
• B) This is a bilateral mistake,so either party can rescind the contract.
• C) This is a unilateral mistake,which can usually be rescinded by the mistaking party.
• D) Because XYZ should have known that this was an error,Gerald will be allowed to rescind the contract.
• E) This is a case of economic duress and Gerald will be allowed to rescind the contract.

---

Definitions:

Cause

A factor or element that brings about an effect or result.

Hasty Generalization

A logical fallacy where a conclusion is not logically justified by sufficient or unbiased evidence.

Arguments

Reasons given in proof or rebuttal, or discussions aimed at reaching a conclusion through reasoning.

Trout

A common name for several species of freshwater fish belonging to the salmon family, often valued as food and game.