Chet Gaines, the director in the real estate division of Jabil, met with Mack Smith about purchasing a large tract of land owned by Smith in Clearwater Florida. Gaines knew the company planned to clear the property to create a new distribution center. Gaines judged Smith to be 80 to 85 years old. During the meeting, Gaines noticed several brochures about dementia and assisted living facilities, as well as several prescription bottles sitting on the table. After discussing the good old days for several hours, Gaines and Smith agreed on the sale of the land for $500,000. Since Gaines brought a blank copy of a contract with him, he helped Smith complete the paperwork and both parties signed. Unbeknownst to either party, the purchase price was written as $50,000. On the day before the closing, Gaines called Smith to remind him of the location of their meeting to sign the remaining documents. Confused, Smith said he didn’t know anything about selling that land and he had no intention of selling his land to some young shyster who was still wet behind his ears and was trying to cheat him.
· What are the basic requirements for contract formation?
· What defects in the contract formation process may have occurred?
· Does Gaines, on behalf of Jabil, have a valid contract with Smith?
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