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Rent Contract Change Analysis

In January Marcus, a CEO of a large corporation located in Canada, contacted Samuel to secure a condo in Hawaii, for July1,2,3, 4 and 5th for his corporate annual meeting with the board of directors. The meeting generally is two half days, and on the last day there is a party to thank all for attending the annual meeting. Marcus wanted to continue his stay throughout the holiday weekend. As in the past, Marcus wants to have the party in the condo. Marcus called Samuel and was advised that for the specific dates he is requesting, there is only a 5 bedroom home available at $2,000 per day instead of the condo which was a rate of $1,000 per day. Marcus responded, "I don't need a five bedroom house. What if I only use one of the bedrooms?" Samuel replied, "That would be O. K. Since we want to do everything possible to satisfy you since you have been such a good customer, we'll let you have the house under the condition that you are using only one bedroom. We can honor a special price for $1,500 per day." Marcus said, "Thanks, and instructed Samuel to send the bill to his office."

In late March Marcus was offered a new job and decided to take it, knowing he booked the house in Hawaii for his corporate meeting, and due to his new job, he is unable to attend the meeting. He offered the house to his friend, Thomas, who has always wanted to take a vacation to Hawaii. Thomas accepted. Marcus told Thomas: "It's $1,500 a day. After your stay, tell Samuel to send you the bill." Marcus neglected to tell Thomas about the condition that he could only use one bedroom.

Thomas arrived and stayed in the house for the 5 days. At the end of his stay, Samuel sent a bill for $10,000, $2,000 per day to Marcus. Marcus has refused to pay the bill, and Thomas claims that he is only responsible for $1,500 per day. What rights, if any, does Samuel have against Marcus and/or Thomas? Discuss.

Solution Preview

Step 1
There is a contract between Marcus and Samuel for the 5 bedroom home at the rate of $1,500 a day. According to this contract Marcus will use only one bedroom and will pay $1,500 a day. The discounted rate of $1,500 was offered to Marcus on the condition that he will use only one bedroom.

Step 2
When Marcus told Thomas that it is $1,500 a day, he assigned the rental contract to Thomas. When Marcus assigned the contract to Thomas it was his responsibility to inform Thomas that he was supposed to use only one ...

Solution Summary

Changes in contract for rental are discussed step-by-step in this solution. The response also has the sources used.

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