BBA 3210 Unit V Assignment

BBA 3210 Unit V Assignment

Columbia Southern University

Unit V Assignment

One day, Gump gets into an argument with the developer. Gump refuses to perform any work until the problem is solved. In this situation, can Alabama Sports Marketing seek specific performance of the contract? If yes, why? If no, why not?

Specific performance orders are unique in that courts are generally reluctant to grant these type of rulings and only do so when monetary damages are not satisfactory due to the fact that the subject matter involved within the contract, is in itself, unique. The subject matter of a contract may be deemed unique when the nonbreaching party; even if awarded compensation, cannot go elsewhere and obtain the same product, object, or service from someone else, therefore rendering any type of monetary compensation inadequate (Kubasek, Browne, Herron, Dhooge, & Barkacs, 2016). Kubasek et al. (2016) state that specific performance, also sometimes known as specific enforcement, “is an order requiring the breaching party to fulfill the terms of the agreement” (p. 285). Under the UCC, situations in which “other proper circumstances” are met, specific performance may be awarded. Though the UCC does not specifically define what “other circumstances” may encompass, “a commonly accepted circumstance is one in which the good is scarce or is no longer being produced and therefore would be difficult to obtain on the open market” (Kubasek, Browne, Herron, Dhooge, & Barkacs, 2016, p. 285).

With this information in mind, it would seem that within the dispute between Gump and Alabama Sports Marketing, the nonbreaching party (Alabama Sports Marketing) would have grounds to seek specific performance within the contract. This is due to the fact that the terms within the contract could be considered unique, in that Gump is set to serve as the CGI model for his character within the game and the developer would be unable to seek or obtain this same product on the open market as no one else can serve as the likeness of Gump and he must do it. If there are no terms within the contract stating the Gump may pause or cancel or portions of the development due to disagreements, then by not performing his agreed upon aspects of the contract, this may be deemed a breach of contract and once this occurs, Alabama Sports Marketing may seek enforcement through specific performance.

How would the court determine whether the liquidated damages clause is valid? Is this clause valid? Explain your answers.

Kubasek et al. (2016) explain that generally in most cases, a court decides the amount of compensation that will be awarded to the nonbreaching party within a contract dispute. However, in some cases the parties involved in a particular contract agree that should there be a breach of contract, it may be difficult for a court to appropriately determine the amount of damages required to compensate for the breach. As a solution and “to prevent a difficult court battle, the parties specify in advance what the liquidated damages will be if there is a particular kind of breach. The parties specify these damages in what is called a liquidated- or stipulated- damage clause in the contract” (Kubasek, Browne, Herron, Dhooge, & Barkacs, 2016, p. 281). Similar to the damages agreed upon between Gump and Alabama Sports Marketing, these specified damages may be expressed as a fixed amount, however, should it be difficult to determine an exact amount, the parties may agree to utilize a specific formula to determine the amount of compensation due within a breach. Courts typically uphold and enforce such clauses, barring that the conditions set forth in the clause are not unreasonable in relation to what the actual costs or rewards would have been should the contract have been fulfilled (Kubasek, Browne, Herron, Dhooge, & Barkacs, 2016). “If the amount specified is so unreasonable as not to bear any logical relationship to foreseeable costs, the courts declare the clause a penalty clause and do not enforce it” (Kubasek, Browne, Herron, Dhooge, & Barkacs, 2016, p. 282). In the case concerning Gump and Alabama Sports Marketing, the clause may be viewed and considered as valid stipulating that Alabama Sports Marketing is able to provide sufficient evidence as to what the estimated sales of the game bearing the likeness of Gump would have been. In the event that the firm is able to provide evidence that the expected sales were within the range of at least $2 million, then the court should deem the clause as reasonable and valid, therefore enforcing it.


Kubasek, N., Browne, M. N., Herron, D. J., Dhooge, L. J., & Barkacs, L. (2016). Dynamic business law: The

essentials (3rd ed.). New York, NY: McGraw-Hill Education.