Case study analysis and research methodology

Jones may be successful in pursuing the additional payment, but only if he can convince the court of a specific interpretation of the last sentence of the letter of September 2008. Jones must convince the court that the first part of the letter was a binding severance award and that the last sentence of the letter was nothing more than an operational instruction from a superior. In that respect, Jones' position is that the phrase "If your employment is terminated without cause before September 1, 2010, Heckler & Quiat agrees that within one month of the date on which your full salary ceases to be paid, you will receive an additional payment of $5,000" was an announcement that Jones had already earned a severance package on the basis of his previous work.

One advantage of that interpretation is that it removes any possible issue of breach of contract on the part of Jones if that sentence is characterized as an offer. If that part of the letter is interpreted as an offer, that would imply that the last sentence reading "You are to give your full attention to Heckler & Quiat client matters in the meantime" set forth that Jones' acceptance would be by agreeing to give his full attention to Heckler & Quiat client matters for the duration of his continued employment.

If the letter is interpreted as an offer of a severance payment that Jones accepted, then Jones' obligation created under the contract would have been to give his full attention to Heckler & Quiat client matters for the duration of his continued employment as a condition of the contact. In that case, as soon as Jones failed to give his full attention to Heckler & Quiat client matters, Jones was in breach of contract that extinguished Heckler & Quiat's obligation to perform by issuing the severance payment.

Heckler & Quiat will try to convince the court that the (entire) letter satisfied the formal requirements of a legal bilateral contract (i.e. offer, acceptance, and valuable consideration) in conjunction with the date and definite amount of value transferred between the parties. In effect, their position is that the first sentence of the letter was actually the first clause of an offer and also the first clause of a contract and that the second sentence was a second contractual clause specifying Jones' exact obligation under the contract.

Jones' position is that the meaning of the first sentence was simply a congratulatory announcement that Jones had already earned a severance package by his previous work. The second sentence was nothing more than an instruction from a superior about Jones' job. In effect, Jones' position is that his previous performance at the firm should be considered past consideration for the severance package that he received in return.