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Acct 556 Case Summary

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The issue is whether John can recover the deep discount offered to Charles for the goods sold. Under section 3 of the Sale of Goods Ordinances (SOGO), the contract of sale between John and Charles is existed. John, who is the seller, transfers or agrees to transfer the property in goods to Charles, who is the buyer, for a money consideration, which is $700,000. The consideration must be sufficient but need not be adequate which means that the consideration is valid in this case. Since John needed $700,000 to raise funds, the goods sold at that time were sufficient for John. When an offer is accepted, an agreement comes into existence, which cannot be revoked. John agreed and sold some of his stock to Charles for a ridiculously low price, …show more content…

John promised to sell some of his stock to Charles with lower price in order to raise funds when they made the agreement. When John sold the stock to the counter-party, John needed cash from liquidation in a short time. In fact, the stock can be sold with a higher price, but what John needed timely fund for repayment of the debt. Besides, it was not necessary for John to sell his stocks to Charles as John had the right to choose the buyer. However, John sold his stocks to Charles because Charles could make the payment within a short time, but not the full value of the stocks, which can help John to repay his debt on time. Therefore, although the selling price of the stock is not adequate to recover the full value of the stock, it is sufficient because the payment from Charles was timely to satisfy John’s demand of fund raising which other buyers may not be able to provide. To John, even if he could sell the stocks with higher price with more gain, but it is useless if he could not find the buyer or get the payment in time. Thus, what made the consideration from Charles sufficient is the timely fund rather than the full value of the stocks, which is urgently required by John to make repayment. As in the case Combe v Combe (1951), John, therefore, cannot deny the low price for the goods which Charles had relied. For an agreement, it is a promise made with

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