TABLE OF CONTENTS Introduction......................................................................................................................................3 Task 1...............................................................................................................................................3 1.1 Importance of essential elements of contract.........................................................................3 1.2 Description of different types of contract..............................................................................4 1.3 Applicability of provisions in given case scenarios...............................................................4 Task 2...............................................................................................................................................5 2.1 Application of the essential elements of contract in given case study...................................5 2.2 Description of contractual terms along with its impact.........................................................5 2.3 Implications of contractual terms in the given case scenario................................................6 Task 3...............................................................................................................................................7 3.1 Contrast between contractual and tort liability......................................................................7 3.2 Nature of liability in negligence............................................................................................7 3.3 Vicarious liability of business................................................................................................8 Case study....................................................................................................................................8 Task 4...............................................................................................................................................9 Defenses provided by negligence law..........................................................................................9 Case study..................................................................................................................................10 Conclusion.....................................................................................................................................11 References......................................................................................................................................12 2
INTRODUCTION Business legislation is formulated to prevent fraud and protect interest of parties in order to promote fairness in the commercial environment. Law of contract and negligence is important of business legislation because it describes standard obligations of parties (Clarkson, 2010). All individuals and business organizations are required to act in accordance with guidelines in order to prevent obligation for payment of damages. Present project report is focused on evaluation of givencasescenariosbyconsideringsuitableprovisions.Inordertoprovideappropriate recommendation reference of previous case precedents will be considered. TASK 1 1.1 Importance of essential elements of contract Contract is a legal enforceable agreement which binds two or more parties to provide appropriateperformanceinaccordancewithcontractualtermsandconditions.Forthe formulation of valid contract parties are required to insert following elements-Offer-Offer isa proposal given by one party to another for entering into legal relationship. It should be supported by justified objective and certainty. Offeror can provide offer either to specific person or in general where all individuals are entitled for the acceptance (Adams, 2010). However, invitation to treat will not be considered as offer in any circumstances.Acceptance-It can be defined as consent given by the offeree to initial party on the offer proposed by them. Offeree is required to accept offer in similar sense without making any material alteration in the subject matter. In situation where modified acceptance is provided by parties then, it will be treated as counter offer (Hyde v Wrench(1840) 49 ER 132).Consideration-In legal terminology, consideration is known as pro-quo which means something in return. Contractual agreement of parties is required to be supported by mutual exchange of beneficial promises (Rush and Ottley, 2006). However, consideration is not required to be fair but it should be as per the mutual agreement. 3
Intention-Parties should intend to create legal agreement to fulfill promises made by them. By considering these aspects, domestic and charitable agreements are not legally enforceable. 1.2 Description of different types of contract Parties entering into contractual relationship can select different types of contract in accordance with their convenience and objective of agreement. Description of different types of contract along with their impact is enumerated below- 1.Face to face and distance contract-Face to face agreement is formed in scenario where all individual are present at common place for the negotiation of terms. In this contract, quick acceptance is expected from party else offer will be terminated (lapsed). Distance contract is selected in situation where parties are apart from one another (Entorres v Miles Far East [1955] 2 QB 327). Due to aspect, agreement is created on the basis of verbal and written communication. In this contract, postal rule is applied to determine validity. As per this rule, acceptance is to be valid if it is appropriately communicated to the offeror. 2.Written and verbal contract-Written contracts are supported by contractual deed in which entire terms and conditions are described. These contracts are comparatively more formal and specific (Treitel, 2003). In contradictory situation, this deed is considered by statutory parties to provide relief to aggrieved party. Verbal contracts are formed on the basis of trustful relationship between parties (Holwell Securities v Hughes[1974] 1 WLR 155). In which terms are discussed through oral communication due to which there is no evidence of initial terms. In this agreement, dispute is resolved by interpreting situation instead of focusing on initial agreement. 1.3 Applicability of provisions in given case scenarios Legal aspects of case study As per the described case study, unilateral offer (offer to entire public) is given by the Techno products in the form of advertisement (Carlill v Carbolic Smoke Ball co[1893] 1 QB 256). In the provided advert, it was stated that initial 10 customers on 12th September 2013 will be entitled to buy high quality customers at the rate of £1.00. On the basis of this advert, Peter waited outside the shop entire night in order to get considered in the first ten customers. On 12th 4
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September he was the first customer and he demanded computer in the stated price. However, Techno products had denied for the same by giving the fact that, no prudent person will believe that computer will be available in this price. In this case main issue is of consideration. Techno products are not completing their performance on the basis of the justification that consideration is not at arm length price (Elliot and Quinn, 2009). In accordance with the provisions of English law, consideration is not required to be sufficient but it should be sufficient in the eyes of law. Applicability of legal aspects By considering the provision of consideration in the given case scenario, it can be said that justification given by Techno products in not logical. In accordance with the case of Chappell v Nestle [1960] AC 87,consideration is not essential to be adequate but it must be sufficient in eyes of law. It is because; fair consideration does not require that benefit to the party should be at arm length price in market (Emerson, 2009). As a consequence, Techno products will be obliged to provide computer to the Peter at the described price in the advertisement as all the essential elements are satisfied in the agreement formed by them. TASK 2 2.1 Application of the essential elements of contract in given case study Legal aspects of case study In accordance with the described case scenario, there is written agreement between parties. In this agreement offer was given by the Jack in order to make purchase of mobile phone. Provided offer was accepted by Telephone by us. In order to support their agreement deed was formed by parties. Consideration for the Jack was television while for “Telephones by us” was money payable. Both the parties intend to enter into contractual relationship in order to fulfill promises made by them. By considering these facts, it can be noticed that all the essential elements are fulfilled in their agreement thus they are having valid contract which is legally enforceable (Goldman, 2013). 2.2 Description of contractual terms along with its impact Contractual terms are clauses inserted in the agreement to describe the obligation of the partieswhich isrequired to be satisfied in order to discharge contract by performance. Bifurcation of contractual terms can be done in following manner- 5
Expressed terms Terms which are inserted by the mutual will of parties are known as expressed terms. Thesetermscanbefurtherclassifiedintoconditions,warrantiesandinnominateterms. Conditions are the core contractual terms which are essential to be satisfied. In situation where these terms are not satisfied then aggrieved party is in position to terminate the contract. Warranties are additional terms inserted to clarify the obligations in proper manner (Kelly and et.al., 2013). If these, terms are not satisfied then is such situation innocent party can only claim for damages. Approach of innominate terms is applicable in situation where contractual terms cannot be bifurcated into condition and warranties. In innominate terms damages are provided by considering impact on breach instead of making classification of terms in conditions and warranties. Implied terms These terms are inserted by statue, custom and previous case precedents in order to provide effect to the obvious intention of the parties. Implied terms are not expressly inserted in contractual deed as it is assumed to be part of the contract (Manuel, 2011). Contracting parties are required to insert terms in accordance with implied terms else it will not be considered as part of contract. Further, in situation of contradiction of implied and expressed terms, implied terms will prevail. Exclusion clause These terms are included in contractual deed in order to reduce obligation in situations where inappropriate performance is given by the parties. These terms will only be considered for relief in situation if it is properly inserted and it is in accordance with the provisions of law (McKendrick, 2012). 2.3 Implications of contractual terms in the given case scenario Legal aspects of case study According to the given case scenario, written contract was signed by Jack for the purchase of telephone. In this agreement, there was an exclusion clause that store will not accept the liability for replacement or repairing in situation of faulty product. Along with this, contracting parties will be liable to entire for the full duration. Provided telephone by store was 6
defective as it was not working in proper manner. Due to this aspect, Jack had complained for replacement but he was informed that he will be liable to provide damages for repair. Applicability of legal aspects In the described case, inserted exclusion clause by Telephones are us is in contradiction with the terms of Sales of Goods Act. In accordance with the provisions of this Act, seller is required to provide product which are free from material defects (Weiss, 2003). Further, in situation of delivery of defective product they will be liable to provide damages. By considering this fact, it can be said that store will be obliged for the replacement. Along with this, they are not entitled to demand damages for the repair from Jack. TASK 3 3.1 Contrast between contractual and tort liability Provision of liability in contract law and tort law is introduced to compensate the damages of the innocent party. Both these liabilities are governed with the regulations of civil law. Contractual liability is imposed on faulty party in situation where they are not able to satisfy terms and conditions of the agreement in a proper manner (Williams v Roffey Bros[1990] 2 WLR 1153). On the other hand, tort liability arises in situation when a person fails to act in accordance with their standard responsibilities and due to which another innocent party is injured (Weiss, 2006). Contract is created by the mutual agreement of parties while in tort relationship is enforced by the legislation (Hall, 2003). Purpose of tort liability is to bring claimant in situation where negligent action was not committed (Vaughan v Menlove (1837) 3 Bing. N.C. 467). Further, damages in contractual liability is provided to bring claimant in situation if satisfactory performance is given by the parties. Damages in contract is predictable in accordance with the deed formed by parties. However, it tort, damages varies as per the situation of negligence and injury of the claimant. 3.2 Nature of liability in negligence Negligence is a tortuous act conducted by individual in which they intentionally or unintentionally omit to take care of their general duties due to which injury is occurred to innocent party. A claimant can make successful claim for the damages of negligent action if they are able to satisfy following aspects (For better understanding of negligence principle following points will be linked to case of Donoghue V Stevenson)- 7
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1.Duty of care-Initially claimant is required to show that defendant owe duty of standard care in order to prevent possibility of injury. In the case of Donoghue V Stevenson, defendant was producer of the ginger beer(Donoghue v Stevenson [1932] AC 562). Thus, it was his duty to take care of manufacturing process to prevent injury to consumers. 2.Breach of duty-Defendant should failed to act in standard manner due to which their duties were breached and act of negligence occurred (Marsh and Soulsby, 2002). In the selected case, decomposed insect was occurred in the drink of claimant which shows negligence of the defendant. 3.Causation and Forseeability of injury-Primary reason of injury should be negligent action of the defendant. Further, claimant should not have any contribution in the act of negligence else they will not be entitled to make claim of damages. In this case, claimant had to suffered from food poisoning and mental trauma (What Does Negligence Liability Involve,2015). As a consequence, claimant was able to proof forseeability and her claim was held successful. Defendant will not be held liable to provide damages in situation where they are able to take benefit of defense available in negligence law. 3.3 Vicarious liability of business As per the vicarious liability provisions an individual is liable for the negligence of parties which are controlled or influenced by them. However, transfer of this obligation does not relinquish original faulty party from guilt (Pesqueux, 2012). On the basis of this provision, business will be held vicariously liable for the action of employees in situation where following conditions are satisfied- 1.Faulty party has status of employee (either part time worker or full time worker). 2.Misconduct should be occurred in course of employment in described duties. Due to this aspect employer is required to take care of actions of employees in order to prevent act of negligence (Vicarious Liability,2013). In addition to this, they should provide them proper guidelines by which employees can perform in a proper manner. 8
Case study Legal aspects of case study In the given case study, Patricia suffered from leg injury due to the incident of train accident. At that time she was traveling from “Safe and steady Trains”. Driver of this train fall asleep due to which crash was caused. Applicability of legal aspects Applicability of negligence principles in the described case situation is as follows- 1.Duty of care-It was duty of train driver to drive with full focus in order to prevent situation of accident as it can cause injury to the passengers. 2.Breach of duty-Act of sleeping during driving shows breach of duty by train driver. It is because, a driver is expected to not to sleep during operating hours because it can severe injury to the passengers (Liability In Negligence,2003). 3.Causation and Forseeability of injury-Driver of “Safe and steady Trains” train fall asleepduetowhichcrashwascaused( The Wagon Mound no 1 [1961] AC 388). As a consequence, Patricia suffered from leg injury. In this case situation all the principles of negligence are satisfied. Henceforth, there are high chances that claim made by Patricia will be held successful. TASK 4 Defenses provided by negligence law Defendant is not required to provide damages for the negligent action in situation where they are entitled to take benefit of one of the following defense- 1.Volenti non fit injuria-In accordance with this defense, if claimant voluntarily put themselves in a scenario where there is risk of injury then they have not right to demand compensation for the damages (Mahamid, 2012). However, these defense is applicable only if claimant isaware of the risk and act is committed voluntarily. For this aspect case of Glasbrook Bros v Glamorgan County Council [1925] AC 270 can be referred. 9
2.Contributory negligence-Defense of contributory negligence depicts that if an individual had contributed in the negligence action then they can not make claim for the damages from the defendant party (Defences to the Tort of Negligence,n.d.). 3.Ex-turpi causa-As per this defense, defendant is not liable to provide compensation for the damages in situation where there none of their action is immoral or unjustified (Oyegoke, 2006). For the applicability of this defense case of Reeves v Commissioner of Police of the Metropolis[2000] 1 AC 360 can be referred. With the applicability of provisions of above described defenses individual is not entitled to provide damages for the negligent action even in situation where all the principles of negligence are satisfied. Case study Legal aspects of case study In the described case situation, Paula was invited to a job interview by the “Pushing and Pulling Ltd” in the building which was solely occupied by them. During her visit tripped over a cable that was running across the reception area at floor level (McKeown, 2003). Company had not provided any notice regarding warning from the exposed cable in the building. In accordance with the provisions of Occupier's Liability Act, an occupier of the premises is responsible to take care of visitors. They should assure that there is no risk of injury to the visitors from the operational activities of business. According to the case precedent ofWheat v E Lacon & Co Ltd[1966] AC 552, in situation where visitors are injured due to their negligence, then they will be obliged to provide damages for the same. By considering this aspect, in the given case scenario, “Pushing and Pulling Ltd” is liable to provide damages to the Paula for her injury. It is because, it was their obligation to provide appropriate warning notice for exposed cable wire being a sole occupier of the building. However, Paula had also taken medication for the virus and it was clear instruction that this medicine should be taken after having food. Paula had taken this medicine without having food due to which she had also contributed in the act of negligence. Applicability of legal aspects By considering the above case scenario, “Pushing and Pulling Ltd” is entitled to take benefit of the defense of contributory negligence. It is because, Paula had contributed in 10
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negligence actions as she had taken this medicine without having food due to which side effects occurred (Gough (an infant) v Thorns [1966] 1 WLR 1387).As a consequence, she is not entitled to make claim of damages in order to compensate her injury (Balatbat, 2010). CONCLUSION In accordance with present report, conclusion can be drawn that parties are required to act in an appropriate manner by complying their standard duties described by law. If parties are not able to provide satisfactory performance, then they will be obliged to provide damages in order to compensate injury of the innocent party. Employer is required to take care of actions of employees in order to reduce possibility of negligent actions. In situation where they failed to do so, they will be held vicariously liable to provide damages to the injured party. Liabilities in negligence can be relinquished if defendants are able to satisfy the provisions of defense provided by the law of negligence. 11
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