D H R Patio Homes, LLC and Snowy Mountains, LLC:¹ Who Goes There? Friend or Foe?

Abstract

This is a field-based disguised case which describes a dilemma faced by the protagonists; do they continue to do business with a land developer who has assisted them in the past when now the developer chooses to, against their recommendations, also do business with their ex-business partner? The problem for the characters in question is whether or not to work on a project that will yield them a net profit of $4 million dollars given the fact it would require them to work in the same development as their former business associate. The central characters are afraid that their ex-partner will be a destabilizing factor in the development of the project and that their work sites will be in jeopardy of being vandalized. Several factors complicate this situation including: the developer’s desire for a quick land purchase, the developer’s changing the discount rate from 20% to 10% perhaps based upon difficulties that surrounded the first land deal, the protagonists’ plans to build their own homes in this new development, and the negative relationship between the protagonists and the ex-business partner. The case has a difficulty level appropriate for a sophomore or junior level course. The case is designed to be taught in one class period (may vary from 50–80 min depending upon instructional approach employed, see instructor’s note) and is expected to require between three to five hours of outside preparation by students (again, depending upon instructor’s choice of class preparation method).