John Leonard and Pepsico, inc Essay Example | Topics and Well Written Essays - 500 words

John Leonard and Pepsico, inc - Essay Example Fourth, the contract would have to have legal purpose. A contract would not be binding if the terms or enforcement were illegal at the time and place that it was implemented. The ruling in the Leonard v. Pepsico case relied on the objective theory to consider the contact void. This theory, often called the innocent bystander theory, purports to ask the question of what a reasonable person might expect from the agreement. Simply put, if an innocent bystander had witnessed the agreement, would they expect it to be serious This sometimes enters a ruling where one party has misstated a condition that any reasonable bystander would understand as a mistake. The party would not be bound by this error. In this case, it was held that any reasonable person would assume that the offer was a joke. The court found that Pepsico was not bound by the agreement on two key points raised by the defense. The first was that the humor used by Pepsico in the advertisement clearly indicated that the offer was intended as a joke and thus failed the innocent bystander test. In Judge Wood's ruling she writes, "The commercial is the embodiment of what defendant appropriately characterizes as 'zany humor'" (United States District Court, 1999, p.6).