Purpose

The purpose of this project is to research, analyze and create a plan that demonstrates your understanding of legal risks and liabilities related to tort law, product liability law, and contract law.

The project requires you to identify and analyze legal issues and to make recommendations. These issues will relate to the concepts covered in weeks 1-7.

You will also develop skills in writing a memorandum and using critical thinking to write an in-depth comprehensive analysis.

Outcomes Met by Completing this Assignment:

analyze contractual rights, obligations, liabilities, and remedies in the business environment
analyze tort rights, obligations, liabilities, and remedies in the business environment

Background: Things have been moving quickly for the PI owners. They are almost ready to open operations. An important next step is to finalize negotiations to contract with Naturals to purchase paint and paint supplies. PI wants a clause in the contract with Naturals that PI would buy paint and paint products exclusively from Naturals for 3 years. The contract will also include a product description that all paints are zero-VOC.

Recently, PI owners learned that although some of Naturals paint products are zero-VOC, most Naturals paint contains 1-5% VOCs, and thus, are not actually zero-VOC.

Under state and federal regulations, paint products that contain less than 8% VOCs can legally be categorized as a zero-VOC green product. However, PI has already begun advertising and marketing its business and paint as zero-VOC.

Naturals paint products are 15-20% less expensive than other equivalent paint products on the market. PI is unsure whether to continue its plan to contract with Naturals for use of Naturals'' paint. The owners are concerned about possible liabilities for PI if it uses Naturals' products knowing the products are not zero-VOC paints. PI has again come to BCA for advice.

The PI owners believe they have 2 options regarding purchase of paint products and supplies.

The options are:

Option 1: Continue PI's plan to sign a contract with Naturals, use Naturals paint under a 3-year exclusive contract, and advertise and market the paint as zero-VOC paint because Naturals paint legally can be categorized as zero-VOC paint under state and federal regulations.

Option 2: Discontinue contract negotiations with Naturals and opt to contract and purchase similarly-priced paints from New Green, Inc., a manufacturer in Mexico. New Green is a new company and one with which PI has no experience. The Mexico company guarantees all its paint are zero-VOC and its paint supplies are chemical-free.

PI has again come to BCA for advice on this matter.

Instructions: Your BCA supervisors, Pat Braden and Gale Roth, have given you the responsibility of researching and analyzing possible legal implications and potential risks and liabilities regarding the decision facing the PI owners about whether to continue buying paint products from Naturals or switch to purchasing paint products from New Green.

You are to research and present your recommendations to PI as a Power Point (PPT) presentation. Scroll down for format requirements for the presentation.

The presentation should address the following:

A. Analyze and discuss the pros and cons - from a business perspective - of PI choosing Option 1 above and continuing to contract with Naturals.

B. Analyze and discuss all the specific potential legal risks and liabilities under negligence law associated with choosing Option 1 and continuing to contract with Naturals.

Be very specific and fully explain each legal risk and liability.

(1) Provide an example of each specific legal risk and liability associated with negligence and Option 1.

C. Analyze and discuss all the specific potential legal risks and liabilities under product liability law associated with Option 1 and continuing to contract with Naturals.

Be very specific and fully explain each legal risk and liability.

(1) Provide at least one example of a specific risk and liability associated with product liability and Option 1.

D. Analyze and discuss the pros and cons - from a business perspective - of PI choosing Option 2 above and contracting instead with New Green.

E. Analyze and discuss any potential risks and liabilities arising under contract law by choosing Option 2 and contracting with a company (New Green) in Mexico.

F. Assume PI chooses Option 1 and establishes a 3-year exclusive contract with Naturals to buy their paint and supplies. Assume further that PI was sued 1 year into this 3-year contract period under product liability law (for example, if a client sued because of some problem directly resulting from use of Naturals paint), what liabilities could PI face under contract law if PI chose to cancel its 3-year exclusive contract with Naturals prior to the end of the 3 years. NOTE: You are to address contract law risks and liabilities, not product liability law.

PRESENTATION FORMAT:

PPT Format 1: Prepare a PPT with all necessary information on each slide. Place all notes, comments, and explanations to clarify and support your recommendations and conclusions for EACH slide directly on slides in the PPT presentation - not in a separate document. You will need more than one PPT slide for each point/idea/concept.

Everything you want to say/include in the presentation should be contained in the PPT slides. You may use bullets for the notes, comments, and explanations for each slide. However, the slides need to be comprehensive and complete, so they could "stand alone" without the additional explanation of the memorandum.

There is no set number of slides, but it must be comprehensive and detailed.

Include a title page, in-text citations, and a reference page on the slides.