Question

Bailey Co. and Spryt Bros. enter into a contract for the manufacture and sale of 400 lawn chairs. If both parties agree that a modification is necessary: What is the surest way to modify the contract?

1) Liquidate the contract
2) Modify the contract without court supervision
3) Agree to rescind the contract, terminating the contractual rights of both parties
4) Courts will generally not enforce a cancellation and modification of the contract unless one party received inadequate consideration under the original contract

Answer 1

The surest way to modify a contract between Bailey Co. and Spryt Bros. is through mutual agreement without court supervision. This entails the parties agreeing on the changes and amending the contract, typically in writing, to ensure clear records of the modifications.

Step-by-step explanation:

When Bailey Co. and Spryt Bros. wish to modify a contract they have entered into regarding the manufacture and sale of 400 lawn chairs, the surest way to modify the contract is for the two parties to mutually agree on the changes and amend the contract accordingly. This can be done without court supervision and should ideally be put in writing to ensure that there is a record of the modification. This is represented by option 2) Modify the contract without court supervision. Rescinding the contract (option 3) would terminate the entire agreement, not modify it, and liquidation of the contract (option 1) is usually associated with settling debts upon dissolving an agreement, not amending it. Regarding concern about inadequate consideration (option 4), as long as the modification has the consent of both parties, and new consideration is present, or if the modification meets the requirements under the Uniform Commercial Code (UCC) for sales contracts, the modification can be legally enforceable without the need for court intervention.