Cengage Advantage Books: Law for Business 18th Edition by John Ashcroft ,Janet Ashcroft

Exercise 1

Pines Grazing Association Inc. (Pines) contracted to sell a ranch to J. C. Investments (JC). Before the sale, the parties discovered that 80 acres they thought had been included in the ranch were not. They went ahead with the sale while Pines tried to buy the 80 acres from Lemhi County. The county had to sell the property at public auction. Pines sent Fred Snook, and JC sent Scott Karterman to the auction to buy the acreage. They met at the auction, and JC agreed to pay Pines $20,000 if it would not bid on the property so they would not bid against each other and drive up the price. Pines did not bid, and JC bought the property for much less than it would have had to pay Pines. JC did not pay Pines the $20,000, and in the resulting lawsuit JC argued that the agreement not to bid was illegal and therefore unenforceable. Should the court enforce the agreement to pay Pines $20,000?