Case Brief – Bill Beasley and California Cuisine Inc Premature Contract Termination

This paper discusses the conclusions, which Bill Beasley and California Cuisine, Inc. arrived at after a disagreement between them arose leading to premature termination of the contract. In regard to the issue, the later hired the former as its executive office during company management restructuring. As a proactive executive, Bill got involvement in the development of a new restaurant concept without either involving or informing the company’s board of directors and/or the Company’s Co-Chief Executive officers. Upon discovering that Bill had developed a new restaurant concept and operationalized it, the company management became angry for not being involved in its development. For this reason, Bill’s services were terminated before the expiry of the contract period on claims that he breached the contract. Besides, terminating the contract, the company demanded the return of the salary that Bill had received for the entire time he was employed. Bill, on the other hand, claimed that he had been wrongly terminated and filed a number of demands, which he required the company to meet.

In regard to the rule, the contract between Bill Beasley and California Cuisine had been formalized into a written agreement before the former began delivering his services to the later. Section 3 of the contract agreement between California Cuisine and Bill Beasley had a clear outline of the Executive’s duties during the period of the contract. The duty requirements of the executive entailed “directing and supervising the management, officers, business, and affairs of the company and perform such other duties commensurate with his offices and as directed by the Board and/or the Company’s Co-Chief Executive officers”. According to Mallor, Barnes, Bowers & Langvardt (343), the offeror of the contract agreement is usually regarded as the “master of the offer”. In this case, California Cuisine offered Bill Beasley a contract to serve as its executive officer, but the terms of the agreement required him to perform his duties in accordance with the directions of Board and/or the CO-CEOs. California Cuisine as the offeror of the contract, included terms and conditions in the agreement could limit the effective life of the agreement. The phrase “as directed by the Board and/or the CO-CEOs”, was meant Bill’s freedom to operationalize his ideas in the company without involvement of the Board and/or the -CEOs. Section 3 of the contract agreement meant that the Executive was supposed to inform and involve the Board and/or the CO-CEOs in every idea that he intended to functionalize Co in the company.

In regard to the application, Mallor et al.  (355) claim that acceptance of the terms of the offeror is the mirror image of the offer. Therefore, in accordance with the traditional contract law, the offeror should not make any attempts to add new terms or make changes to the existing terms. Any attempts to make additions or changes to the terms amounts to counteroffers. This is because such offeree’s attempts are an implied indication of his or her inability to be bound to the terms of the offer. The contract agreement that was signed between Bill Beasley and California, Inc. had terms that were supposed to be observed by the former. Under section 3 of the contract agreement, the executive’s duties were supposed to be solely supervision in accordance to the directions of the Board and the Co-CEOs.

Even though Bill Beasley, being the executive, was supposed to offer supervisory services, as directed by the Board and/or the CO-CEOs, his participation in the strategic planning was part of his managerial duties. It is evident that the new restaurant concept raised the company’s pre-tax net income from $72,000 in 2011 to $387,191 in 2012. Even though the company was not informed about the new restaurant concept, the main objective of maximizing revenues was realized. This is a sure indication that Bill’s involvement in the development of the restaurant concept was done in good faith, and had no intentions of changing the terms of the contract agreement. Since section 3 of the agreement required Bill to perform supervisory services, it was right for him to perform his managerial duty of supervising the company’s strategic planning office that led to the development of the new concept. Taking the matter to the court will be the best option for Bill because his efforts at the company were meant to improve the revenues of the company and the financial records are available to prove that.


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