The purpose of this assignment is to analyze and select an appropriate method of alternative dispute resolution (ADR) for a business dispute, to examine unethical business behavior, and to develop risk management procedures to avoid or reduce claims and litigation.
Read the following scenario:
Dazzling Dough Co. sells pizza dough to local pizza restaurants. Most of the restaurants buy at least 150 pounds of pizza dough from Dazzling Dough Co. in each order. Jerry’s Pizza contacted Dazzling Dough Co. to purchase 200 pounds of pizza dough, along with some other items. Dazzling Dough Co. sent Jerry’s Pizza a written contract, prepared by Dazzling Dough Co.’s lawyer, stating that “Jerry’s Pizza agrees to purchase 200 pounds of pizza dough, pizza toppings, desserts and soft drinks for $30,000.” Jerry’s Pizza signed and returned the contract.
A few days later, Dazzling Dough Co. sent Jerry’s Pizza 125 pounds of pizza dough and 75 pounds of pizza toppings, desserts, and soft drinks. Jerry’s Pizza contacted Dazzling Dough Co. about the error in the contract and demanded an extra 75 pounds of pizza dough. Dazzling Dough Co. said there was no error, that Jerry’s Pizza signed the contract so they agreed to the terms, and it was not sending the extra pizza dough.
After several attempts to resolve the dispute and a pressing need for dough, Jerry’s Pizza terminated the contract and sent Dazzling Dough Co. a check for $15,000 for the 125 pounds of pizza dough, pizza toppings, desserts and soft drinks. Jerry’s Pizza immediately purchased 75 pounds of pizza dough from another company for $12,000. Both parties are threatening to sue each other for breach of contract. They prefer to resolve the dispute out of court because the contract contains a clause that awards reimbursement of attorney’s fees to the winning party.
The board of directors of Jerry’s Pizza scheduled a meeting with you and other senior management at the company to discuss the dispute. You’ll need to prepare a strategic plan overview (an abbreviated strategic plan, not a full plan) for the board that explains why there is a dispute, suggests various settlement proposals, and provides recommendations on how Jerry’s Pizza can avoid this kind of dispute in the future.
Prepare a 600 word strategic plan overview to resolve the legal dispute for the board (use the bullet point headings provided below to format your overview) addressing the following:
- Summary of Dispute
- Identify the source of the dispute.
- Identify each party’s interpretation of the contract language.
- Identify whether each party’s interpretation is reasonable.
- Identify any missing facts that would be helpful to know in order to resolve the dispute.
- Proposed Revisions to Contract Language
- Recommend specific revisions to the contract’s language so that it is clear what Jerry’s Pizza expected to buy and what Dazzling Dough Co. is required to deliver.
- Ethical Considerations
- Explain the ethical considerations for a company to enforce specific terms of a contract against another company if the other company is mistaken about what was agreed to. Discuss the factors that should be considered.
- Two to three possible settlement options (e.g., pay for the disputed dough, reduce the amount of dough to be purchased, split the difference, refuse to pay, etc.)
- Two to three methods of dispute resolution (e.g., negotiation, mediation, arbitration, litigation, etc.) that Jerry’s Pizza can propose to Dazzling Dough Co.