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28 April, 11:49

For the past seven years, Sommerset Storage, Inc. has hired Mountbattan Tax Associates to prepare its annual tax return. This year the parties agree to their usual $1,000 fee, but Mountbatten finds a loophole in the tax code and gets Sommerset a refund four times the usual amount. Mountbattan then requests that Sommerset pay $4,000 to reflect the increased tax refund. There is nothing in their contract about increased fees, but Mountbatten argues it would be unjust for Sommerset not to pay extra. Sommerset refuses and Mountbatten sues. What result? a. The court will apply a quasi-contract and Mountbatten will win.

b. The court will find that there is an implied contract and Mountbatten will win.

c. The court will rely on promissory estoppel and Mountbatten will win.

d. The court will uphold the original contract and Mountbatten will lose.

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  1. 28 April, 13:30
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    Option D. The court will uphold the original contract and Mountbatten will lose.

    Explanation:

    The reason is that the service consideration agreed will remain the same because the same level of services is provided from the tax firm. This means that the tax firm has not performed any special or excessive to the agreed level, hence the Sommerset Inc. is not liable to pay more than the agreed. On this basis, court will be uphold the original contract formed between these two parties and as a result Mountbatten will lose.
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