Question details

Although they had no written contract, Larson agreed to take on the project
$ 15.00


Take Home Exam – Question 1.

Due:  IN CLASS April 21


This question is worth 20  points on the final exam.

Please use the class period on April 19th to complete this assignment. 

The following facts are true.  This same statement of facts appears in your book at page 244.  Nevertheless, information from other chapters is pertinent in analyzing this question. USE ONLY YOUR BOOK AND CLAS NOTES TO ANSWER THE QUESTION.  Using outside information will confuse your answer and if you introduce extraneous material, it will not be considered in grading this question.You should consider all theories of contract law that reasonably apply to this case. 


Edward Johnson III, the CEO and principal owner of the world’s largest mutual fund company, Fidelity Investments, Inc., was a longtime tennis buddy of Richard Larson. In 1995, Johnson asked Larson, who had construction experience, to supervise the construction of a house on Long Pond, Mount Desert Island, Maine. 


Although they had no written contract, Larson agreed to take on the project for $6,700 per month plus lodging.  At the end of the project in 1997, Johnson made a $175,000 cash payment to Larson, and he made arrangements for Larson to live rent-free on another Johnson property in the area called Pray’s Meadow in exchange for looking after Johnson’s extensive property interests in Maine. 


In the late summer of 1999, Johnson initiated a new project on the Long Pond property.  Johnson had discussions with Larson about doing this project, but Larson asked to be paid his former rate, and Johnson balked because he had already hired a project manager.  According to Johnson, at a later date he again asked Larson to take on the “shop project” as a favor and in consideration of continued rent-free use of the Pray’s Meadow home.  Johnson stated that Larson agreed to do the job “pro bono” in exchange for the use of the house, and Johnson acknowledged that he told Larson he would “take care” of Larson at the end of the project, which, according to Johnson, meant that he could pay him as much as or little as Johnson determined.


Larson stated that Johnson told him that he would “take care of”  Larson if he would do the project and told him to “trust the Great Oracle” (meaning Johnson, the highly successful businessperson).


Larson sought payment in March 2000 and asked Johnson for “something on account” in April.   Johnson offered Larson a loan.  In August during a tennis match, Larson again asked Johnson to pay him.  Johnson became incensed, and through an employee, he ended Larson’s participation in the project and asked him to vacate Pray’s Meadow.  Larson complied and filed suit for payment for work performed at the rate of $6,700 per month. 


  1. What legal theory or theories  Larsoncould utilize in his lawsuit? For each theory, explain what Larson would have to prove.


  1. Write a paragraph as if  you were the judge deciding this case.  Be clear which part prevails and what remedy, if any, should be awarded.



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