solution

Elite Development Inc. (“Elite”) is in the business
of acquiring large parcels of land for commercial development. Elite has
pursued William Howell III for a number of years looking to purchase his family
estate (“The Estate”) for the purpose of developing a golf and
country club (“The Club”). Mr. Howell has always refused Elite’s
offers to purchase. Over the years Elite has acquired two other large pieces of
land adjacent to The Estate, but The Estate is critical to the development of
The Club. Unfortunately, Mr. Howell is not getting any younger and with the
upkeep and maintenance of The Estate becoming increasingly difficult for him to
manage, he has finally decided to dispose of The Estate.

On September 10th, Mr.
Howell’s real estate agent gave Elite’s president an offer whereby Mr. Howell
offered to sell The Estate to Elite for $5,000,000. The offer was
“open” until September 17th and specified that acceptance was
required in writing. On September 13th Mr. Howell’s the real estate agent
contacted Elite’s president and informed her that Mr. Howell had unexpectedly
sold The Estate to someone else. In response. Elite’s president stated that
Elite’s Board of Directors had met the night before, had approved the purchase
and she had already initialled the offer and prepared a formal letter of
acceptance. Following her discussion with the real estate agent, Elite’s
president immediately delivered the initialled offer and the letter of
acceptance to Mr. Howell.

Elite sued Mr. Howell
for breach of contract.

1. Discuss the basic elements of a contract and
whether the negotiations set out above constitute a legally enforceable
contract. Your discussion should include Mr. Howell’s defence. Be sure to
consider the fact that this is a contract involving land. Render a decision.

ii. What could the parties have done to keep a firm offer open? Would
such an agreement impact whether there was an enforceable contract between the
parties?

iii. What avenues of dispute resolution do you recommend to Elite in
resolving the dispute with Mr. Howell? Why?