Question

In a world of get-rich-quick schemes, few are mentioned more frequently than lawsuits. One of the reasons is the infamous McDonald’s coffee case (Liebeck v. McDonald’s Restaurants). This is what happened in 1992 in Albuquerque, New Mexico. Stella Liebeck, seventy-nine, was riding in a car driven by her grandson. They stopped at a McDonald’s drive-through, where she purchased a Styrofoam cup of coffee. Wanting to add cream and sugar, she squeezed the cup between her knees and pulled off the plastic lid. The entire thing spilled back into her lap. The searing liquid left her with extensive third-degree burns. Eight days of hospitalization—which included skin grafts—were required.

Initially, she sought $20,000 from McDonald’s, which was more or less the cost of her medical bills. McDonald’s refused. They went to court. There it came to light that about seven hundred claims had been made by consumers between 1982 and 1992 for similar incidents. This seems to indicate that McDonald’s knew—or at least should have known—that the hot coffee was a problem.

Most of the rest of the case turned around temperature questions. McDonald’s admitted that they served their coffee at 185 degrees, which will burn the mouth and throat and is about 50 degrees higher than typical homemade coffee. More importantly, coffee served at temperatures up to 155 degrees won’t cause burns, but the danger rises abruptly with each degree above that limit. So why did McDonald’s serve it so hot? Most customers, the company claimed, bought on the way to work or home and would drink it on arrival. The high temperature would keep it fresh until then. Unfortunately, internal documents showed that McDonald’s knew their customers intended to drink the coffee in the car immediately after purchase. Next, McDonald’s asserted that their customers wanted their coffee hot. The restaurant conceded, however, that customers were unaware of the serious burn danger and that no adequate warning of the threat’s severity was provided.

Finally, the jury awarded Liebeck $160,000 in compensatory damages and $2.7 million in punitive damages (about two days’ worth of McDonalds’ coffee sales). The judge, however, reduced the $2.7 million to $480,000. McDonald’s threatened to appeal, and the two sides eventually came to a private settlement agreement. [1]

In general terms, what does it mean to claim that an implicit contract arises around a transaction? How does that contract protect the consumer?

From the information provided, and from your own experience, what are the main terms of the implicit contract surrounding the purchase of coffee at a fast-food drive-through?

What does the restaurant owe the consumer?

What does the consumer owe the restaurant?

Answer 1

A. Implicit contract is an unspoken or unwritten agreement between two or more parties caused by actions of the involved parties. In other terms it means that even though there is no legal contract being made at the time of initiating the transaction, still the actions of parties are sufficient enough to initiate a contract.

B.The contract protects the consumers by enforcing the undeniable obligations which the seller has towards them. It protects from the loss they might have to bear in case they don’t get product or services worth they paid for .

C. From the information provided and from my own experience the implicit contract surrounding the fast food drive though are:

1. McDonald’s should provide for the coffee in required quantity to the consumer.

2. McDonald’s should take care that the coffee is tolerably hot.

3. They should take measures to ensure that the coffee cups are spill proof and insulated.

4. If they are providing extra hot coffee to the consumers they should take prior permissions before doing so.

5. If any health related issue occurs to the consumer after consuming the coffee McDonald’s is definitely responsible for the consequences.

D.The restaurant owe the consumer to provide coffee which is readily consumable. If it is too hot it should be mentioned by the employees. Also, it is the responsibility of the companies to take extra care before serving such hot drinks to children and elderly people.

E. The consumer should also be careful while ordering hot drinks, it is also their duty to mention beforehand that it is for elderly people. They should not open the hot drink cups as the spillage may cause harm.