IN THE FEDERAL COURT OF THE COMMONWEALTH OF REDMONT
This is practically an open-shut case of the Plaintiff trying to frame the Defendant as someone who unrightfully failed to fulfill his end of a contract, but this is not what happened. I've presented all my arguments in the Answer to Complaint, and will briefly reiterate and clarify them in this filing, but the majority will be a response to the Plaintiff's Opening Statement.
II. RESPONSE TO PLAINTIFF'S OPENING STATEMENT
1. "In their first argument, the Defendant attempts to invalidate our position in the contract as we did not pay xLayzur the $150,000, as was agreed upon, and therefore the contract should have been invalidated. However, we acknowledge that this sum was not paid, however we defend that this was the right decision on the Plaintiff’s part for two key reasons:
a) According to our calculations, the Defendant owed the Plaintiff a massive sum of over $5.3 million. As we would have been paid back easily even if we had given the Defendant the $150,000, it did not seem necessary in our eyes to pay the sum, especially when there was the potential (there was not a potential, we had reason to believe, based upon evidence, that they would not live up to their end) that the Defendant may not follow through on their end of the contract.
b) We intentionally committed an anticipatory breach of contract due to evidence provided to our firm within a week of the contract’s expiry, which showed that the Defendant had no intention of paying their end of the contract (fig. 7) and therefore we were forced to anticipatorily breach the contract to prevent any (further) monetary damages."
Well, that isn't so difficult to see. The Plaintiff did not pay the Defendant $150,000, as agreed upon in the "contract." It is plain and simple. Thus, the Defendant had no legal obligation to fulfill his end. The quote is literally a confession that they did not fulfill their end of the contract. They try to defend this choice, but there is no legal backing for this.
2. "In their second argument, the Defendant actually makes two claims: first, that the definition of “inflation” in the contract is arbitrary and cannot be enforced due to the Contract Law Foundation Act, and second, that our calculation is incorrect and in fact we should owe the Defendant $5.3 million.
a) There is no “misrepresentation” found in the contract which the Defendant signed of their own volition and with a full understanding of the terms of the contract. In figure 1, the Defendant clearly understands what is meant by the terms of the contract by acknowledging that the contract is done with the intention of being represented as an “inflation-swap.” If both parties agreed to the representation and believed it to be true, it is simply egregious to attempt to accuse one party to the contract of misrepresentation, and it would be egregiously wrong for the court to rule on this point as the representation was mutual, regardless of if it was true.
b) Second, I respectfully encourage the Defense counsel to brush up on his math knowledge. To take the absolute value of a number is to find the distance between that number and zero. That is to say, the absolute value of a number, regardless of if it is positive or negative, will always be positive. Even if the calculations before the absolute value resulted in a negative number, due to the absolute value being applied, the number must be positive. This argument is simply false."
I do not appreciate the insult to my intelligence, but I will ignore it and respond substantively to clarify the argument. My understanding is that the Defendant is referring to this argument:
"Another Misrepresentation is that the Calculation used to find the payment is:
ABS(A * [(IE / IS) - 1])
Interestingly this would be, in word, “the absolute value of [$150,000 times (the inflation rate at the end of the term divided by the inflation rate at the start of the term) minus one]”
Yet the “contract” states “xLayzur will pay Belmont Financial Group LLC an amount equal to the inflation rate over the next three months multiplied by the notional amount.” This would mean xLayzur would pay the Plaintiff NEGATIVE $5,302,548.77. Thus, if this “contract” were enforceable, the Plaintiff would actually owe xLayzur over 5 million dollars. The Plaintiff is fortunate that this contract was made so poorly as to be unenforceable."
I fully understand how Absolute Value works, and that the "Calculation" would result in $5,302,548.77, however, if you actually read the argument and the "contract" , you would see the very next line of the "contract" saying "xLayzur will pay Belmont Financial Group LLC an amount equal to the inflation rate over the next three months multiplied by the notional amount." This does not include Absolute Value and is not used to calculate any of the values used within this sentence. Thus, either the calculation formula is a misrepresentation, or the sentence is a misrepresentation. Thus, the contract is unenforceable. I hope that clears it up.
I also return to the terms of the contract requiring that the Government determine the inflation rate and that the inflation rate is found in the CPI. The inflation rate was not available in the CPI, and thus this contract is unenforceable. Sure, the Defendant was aware that this was allegedly an inflation-swap, but there was so much misrepresentation within the "contract" that in actuality, the "inflation-swap" was a guaranteed net-gain of money for the Plaintiff, and guaranteed net-loss for the Defendant, but again, this is solely due to the misrepresentations.
3. "This argument claiming that Aezal bought Nexalin’s (Belmont/Morgan Sheraton’s) share in the contract is simply a false statement and we will be addressing this through a line of questioning when Aezal is called as a witness to this case."
As stated previously, we aren't certain of the validity of this claim, but thought it was relevant. We are willing to believe the Plaintiff on this particular point.
4. "Let’s break down this extremely complex argument focused on the definitions of contracts under the Foundation of Contract Law Act (CLF). In their argument, the Defendant claims that this contract does not have capacity nor legality, two aspects of a contract, however, they fail to define these aspects of a contract and simply assert their misconstrued idea of what a contract is, and I will now be addressing why each aspect of their argument is misconstrued:
a) Capacity is not once defined under the CLF, which they proudly and mistakenly cite. In fact, the Supreme Court has set a precedent which this court must follow for what one should consider capacity to be in  SCR 11. In the majority opinion, Justice JoeGamer defined capacity as “a party that has the legal ability to enter into a contract.” There is no dispute here about the ability for both the Plaintiff and Defendant having the means to enter into the contract, as both parties, being private citizens, are not restricted from entering into contracts, and both parties had the means to fulfill their obligation.
b) Legality is also not once defined under the CLF, and also has been defined in  SCR 11 as “whether the contract itself is enforceable and legally binding.” The Defendant asserts that the contract lacks legality due to a supposed lack of capacity, however as we have established, there was no lack of capacity at the time of signing, and therefore the contract fulfills all other legal obligations set out by the CLF, and the Defendant agrees.
c) The Defendant finally attempts to make a very convoluted argument that the contract does not possess consideration and calls it a “promise.” However, we would argue, in this case, the contract does indeed satisfy the test for Consideration laid out under §9 of the CLF. In fact, this contract explicitly falls under §9(4), which defines executory consideration as “a promise in return for a promise.” In the contract, the Plaintiff promised to pay the Defendant $150,000, and the Defendant promised to pay the Plaintiff the appropriate sum by the calculation defined by an agreed-upon representation by both parties. Therefore, consideration does exist in this contract."
I am willing to agree that I was sorely mistaken and that Capacity was met. The requirement for Legality, however, was not met, as the "contract" is illegal due to all the other arguments, particularly argument 5.
Moving on, "the Plaintiff promised to pay the Defendant $150,000 ..." yep.... there we have it again. The Plaintiff never paid the Defendant, so why on earth would the Defendant pay the Plaintiff? The Plaintiff failed the Defendant, and they should be getting a 1-star review on Yelp.
5. "In the Defendant’s last argument, they attempt to define the contract as “unfair,” which is untrue for the following reasons:
a) Regarding protecting the contractor’s legitimate interests, yes, this contract does protect the legitimate interests of the contractor, as the contractor is a financial and investment firm, and such invalidating this contract would leave the contractor open to future damages from clients. Thus, it is imperative that the contractor is able to enforce the terms to protect their interests of maintaining safe and legitimate services.
b) Regarding detriment to the Defendant, while we acknowledge the sum to be payed is a large amount, the Defendant willingly entered into this contract, and striking down this contract based on detriment to the defendant would significantly and erroneously cause the entire contract law system of Redmont to go into crisis, as any person who has to pay due to a contract could claim that they are being caused detriment by having to pay a contract.
c) Finally, regarding transparency, as established multiple times, both parties were well aware of the terms of the contract at the time of signing and therefore the contract is transparent. The Defendant tries to point to the mutual misrepresentations here, however as we demonstrated earlier, these misrepresentations were not malicious and were made mutually and thus cannot be enforced."
Let's focus on this: "The Defendant tries to point to the mutual misrepresentations here, however as we demonstrated earlier, these misrepresentations were not malicious and were made mutually and thus cannot be enforced."
Here, we have another confession: there were misrepresentations in the contract. I need not say more.
Going back to the rest, the Plaintiff can say whatever they wish, but my response stays the same as it was:
"So, your honor. Ask yourself, are these terms reasonably necessary to protect the legitimate interest of the contractor? I don’t think so. $150,000 three months ago is not equal to over $5 million now, so these terms are unfair.
Does this term cause xLayzur detriment if the contractor enforces it? Yes, your honor. It would literally take the Defendant’s entire net worth – everything he has worked for his entire life – to even begin to pay off this “contract.” Thus, these terms are unfair.
Finally, how transparent are these terms? Well, as stated before, there are multiple misrepresentations and the calculation of the payment is stated different in two different places within the contract. Thus, these terms are unfair."
6. "Finally, neither in the CLF Amendment Act nor in the CLF itself does it state that the courts have the authority to strike down a contract due to “unfair terms.” The only way that a contract may be struck down by the courts, per the CLF, is if the contract lacks Offer, Acceptance, Consideration, Capacity, Legality, Legal Intent, or Format. Therefore, regardless of if some terms may be “unfair,” this point is moot, as there is no legal basis for the court to invalidate the contract based on this argument."
First of all, this is not true. The Unfair Terms clause clearly exists to define unfair contracts and allow the court to strike it. The Plaintiff mentions precedent that this is not true, but never states where this precedent can be found, so I question its validity.
III. OPENING STATEMENTS
1. The Plaintiff breached the terms of the contract by not paying the Defendant $150,000. Because of this, the Defendant has no obligation to pay the Plaintiff anything. This argument alone is enough to win this case.
2. The contract contains multiple misrepresentations. This is confirmed by the Plaintiff, saying, "these misrepresentations were not malicious and were made mutually and thus cannot be enforced."
3. The contract is unfair, as per the CLF Act and its only amendment.
4. For those reasons, it is abundantly clear that the Defendant owes the Plaintiff nothing.
IV. COUNTER PRAYER FOR RELIEF
1. The Defendant seeks a public apology from Morgan Sheraton & Co LLP for filing a baseless lawsuit, worth over $5 million, against him.