Business law; verbal contract; small claims case

Restoration Experts – Contract – Scenario
When William Shelton’s carpet business was swept away due to a fire, he got a first-hand, crash course in restoring the building back to its original state. His friends and family couldn’t believe how beautiful it was once it was done, and through their encouragement, William got into the restoration business. His son, Lee Shelton, came alongside him, and at the age of 16, Lee learned everything from his father about clean up, including water and flood damage, fire damage, earthquake damage and the like. Lee soon took over his dad’s business, and his reputation proceeded him in the community of Davis, California.
Recently, Mr. Lee Shelton received a phone call from a woman in Washington requesting his services. She introduced herself as Mrs. Kim Hawkins. She told Mr. Shelton that she had recently been an unwitting victim of flooding in the basement of her home, as a levee on the Touchet River broke just outside of her small town. Her basement was actually a second living space that had been converted in 2012. She has friends and family in Davis California, and although it’s a distance, Mr. Shelton was highly praised and recommended to Mrs. Hawkins. (Since Mrs. Hawkins is well-to-do, and lives in a very expensive home, she considered their endorsement, and called Mr. Shelton.) In the conversation between Mr. Shelton and Mrs. Hawkins, they agreed upon the date of April 10th to start the work of restoration of the basement. Since it was a 12-hour drive from Davis to Waitsburg, it was discussed in the conversation that Mr. Shelton would drive up from his home on the evening of April 8th, and start work on April 10th to do the following:
• Remove damaged components: Any unsafe components that are not able to be restored are removed from the home.
• Removing flooring: To prevent the collection of soot, dust, and other harmful elements and remove any floor coverings that could promote an unhealthy or unsafe environment.
• Evaluating structural framing: Such as framing and subfloor material, and bring them up to safety standards.
• Treating for odor and contamination: with odor counteractants that ensure no microbial contamination is present.
• Removing or restoring the HVAC system: To ensure no harmful particles will spread throughout the air and cause future health problems.
o https://www.restoration1.com/our-services/fire-smoke-damage/
Mr. Shelton discussed the above listing with Mrs. Hawkins in detail, and took down the measurements of the basement. Mrs. Hawkins also sent photos of the damage, and requested that Mr. Shelton purchase carpeting that would replace the damaged flooring. All of these particulars were discussed over the phone prior to the conversation ending.
Because flattery will get you everywhere, only a verbal agreement was struck between Mr. Shelton and Mrs. Kim Hawkins. On the evening of April 8th, Mr. Shelton pulled his truck out of his driveway with all his installation equipment, including the following materials he had purchased, as requested by Mrs. Hawkins:
600 sq. ft. basement (new) carpet @ $2,400.
3 Gallons of Odorcide 210 Concentrate, Fresh Scent @ 78.25 each plus tax (7.25) = $95.26

Other expenses would be purchased after he stated the job:
$4,758, while 500-600 sq. ft. spaces cost $6,912
HVAC system – Cost, Duct work &Installation – Estimation @ $4,000
On April 9th, the night before the appointment, Mrs. Hawkins called Mr. Shelton at 10:30 pm and cancelled the job. Mr. Shelton had already driven the 772 miles to Waitsburg, and had paid for his hotel for the week, which was non-refundable, given the time-frame of the reservation was past the grace period for cancellation. Mr. Young lost a total of $1,810 in day wages, travel/gas, food and hotel expenses, (to include the hotel and food expenses from April 8 & 9th), plus $2495.26 in material purchases, for a total of $4305.26.
Mr. Shelton now wants to take Mrs. Hawkins to small claims court, but is unsure as to which court he should make the claim, given that Mrs. Hawkins lives in Washington, and he is unsure of the jurisdiction laws. There are also other considerations as well that he is concerned about; and he is unsure as to what to do at this point.

1. Given the circumstances of this case, and based on your research below, which state should have jurisdiction over this verbal agreement, Washington or California? Explain your answer in detail.
2. Given that this was a verbal agreement between Mr. Shelton and Ms. Hawkins, what concrete evidence should Mr. Shelton bring with him to small claims court in order to establish and present his case, given there were verbal arrangements made for this service to be done?
3. Obviously, Mr. Shelton needs to develop a contract. List 5 terms of agreement that should be included in a written contract, and specifically why they need to be included in order to establish future client agreements. (For example, a Cancelation Clause) Use the research below.
4. Mr. Shelton has now filed a claim in small claims court asking for the reimbursement for money he spent in anticipation of a service that he was not able to perform due to the cancelation. As a judge in this case, at what time did the job commence? (Substantiate your reasoning.) Does Mrs. Hawkins owe Mr. Shelton the $4305.26 dollars lost in day wages, travel food and material expenses? What are your findings, based on the evidence presented by Mr. Shelton, to find in favor of the plaintiff or the defendant? Explain and back up your answer.
5. In conclusion, if you were approached by Mr. Shelton to help manage his future dealings, how would you specifically instruct him in working with clients, especially clients that are calling over the phone for his restoration service, requesting him to come out to their personal residence.

 

 

Sample Solution

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