Joe Was a Contractor and He Hired Subtrades to Help

question 74

Essay

Joe was a contractor and he hired subtrades to help build his houses.Sam was a framer and had agreed to frame four houses for Joe for a set price.Joe was to supply the materials.After two houses were completed,Joe's suppliers increased the cost of lumber,and Joe told Sam that he could no longer pay him the amount on which they'd agreed.Sam agreed to take 15% less for the other two jobs,which were then completed.During this time,regular payments were made from Joe to Sam,but the total amount received was 15% lower than the originally agreed-upon price for the last two jobs.Sam sued Joe for the original contract price,claiming that he'd received no consideration for his agreement to take less for the last two jobs.Explain what defences may be available to Joe under these circumstances and his likelihood of success.

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Definitions:

Put Option

A financial contract giving the holder the right, but not the obligation, to sell a specified amount of an underlying asset at a set price within a specified time.

Strike Price

The price at which the holder of an option can execute the contract to buy (call) or sell (put) the underlying asset.

Stock Price

The current price at which a single share of a company's stock can be bought or sold in the financial markets.

Exchange-Traded

Refers to securities or other financial instruments that are traded on a formal exchange, facilitating transparency and liquidity.