Contract Law and Business Operations

This assignment delves into the crucial role of contract law in shaping business practices. It examines various aspects of contract law, including breach of contract, damages, and negligence, as they apply to real-world business scenarios. Students are expected to analyze case studies and legal principles to understand how contract law influences legal disputes and business operations.

ASPECTS OF CONTRACT
AND NEGLIGENCE FOR
BUSINESS

Table of Contents
INTRODUCTION...........................................................................................................................2
TASK 1............................................................................................................................................3
1.1Formation of contract and importance of various elements...................................................3
1.2 Types of contract...................................................................................................................3
1.3 Types of terms of legal contract............................................................................................4
TASK 2............................................................................................................................................5
2.1 Apply elements in given case scenario.................................................................................5
2.2 Effects of terms on legal contract..........................................................................................6
TASK 3............................................................................................................................................6
3.1 Similarities and differences of liability.................................................................................6
3.2 Negligence liability...............................................................................................................7
3.3 Vicarious liability..................................................................................................................7
TASK 4.......................................................................................................................................8
4.1 Apply the elements of negligence of tort in the given case scenario....................................8
4.2 Vicarious liability in the given case......................................................................................8
CONCLUSION................................................................................................................................8
REFERENCES................................................................................................................................9

INTRODUCTION
Contract is the legal term in which two or more parties are comes in the contractual
relationship. It is the written or spoken voluntary legal agreement which is enforceable by law.
Contract law is concern with the rights as well as duties which is arise from the agreement.
Parties are bound to follow their legal rules and duties which are imposed on them as per the
contract act. There are various types of essential elements which are involved in legal contract
such as offer, acceptance, intention and also capacity of contract. Different types of contract has
been formed such as face to face, oral and written (Wong and Deubert, 2010). If any party is
found that he is liable for the breach of condition then court needs to imposed penalty on them.
Consideration must be involve in this legal term.
TASK 1
1.1Formation of contract and importance of various elements.
Contract is an agreement which is arise among two or more parties. This contract is
legally enforceable if it is executed as per the requirement of law. Here, parties mutually comes
in the contract and they have to fulfill rules and regulation which are imposed in the legal
contract. There must be legal agreement which is signed by both parties and try to maintain
contractual relationship as well (Zamore, 2016). In the given scenario, Peter Abraham is able to
arise legal contract with building contractor. Both the needs to prepare written agreement
according to the requirement of law. But have to but Peter Abraham must ensures that various
types of contract elements needs to be present in the contract are as defined below:
Offer- It is the important element of every contract. One parties send offer to another
party and that party have to show their free consent. If they reject the offer then contract is not
formed. On the other hand, if they accept then it becomes contract as per the law.
Acceptance-
Intention- In order to create legal relation it is one of the main requirement of valid
contract. It is the common intention of parties which is enforceable by law.
Consideration- It is the essential part of every legal contract. It means the other party is
liable to giving back in return (Marks, Marks and Jackson, 2013). It is consider as exchanges
which is made among promissor and promisee. If consideration is present in contract then it is
consider as valid according to law.

Capacity- It means parties are enough capable to perform their duties. Person who is
below the age of 18 is not capable to enter into the contract. But the person who attain 18 years
of his are valid and capable to enter into the contract.
Privity of contract- It is the legal among parties which imposed rights they can sue each
other. But prevent a another third party to doing so.
1.2 Types of contract.
According to the contract act there are different types of contract which are
enforceable by law which are as defined below:
Face to face- This type of contract has been formed when both the parties are present in
same area and in meeting they discussed the facts. In this parties can touch each other.
Written- It is the type of contract which is ion the written form and must be signed by
both parties. It is as an evidence which is able to shown in future. Parties have to agree same
thing in the same sense which is legal as per the law (Stempel, 2010). In this same situation is
not apply on other parties. Certain duties and rights are mentioned in the written contract which
have to follow by all the parties and try to fulfill duties which are imposed on them.
Distance selling- In this contract parties do not get a chance to meet face to face and
form valid contract. Which has been formed on the basis of trust as well as faith.
Impact- The legal contract are mainly based on the impact and also it has been analysed
on the basis impact.
1.3 Types of terms of legal contract.
The contractual term of legal term is the part of legal contract. Each term is able to rise
contractual obligation. All terms are not express in nature some terms are implied in nature also.
Some different types of terms are as aligned below:
Warranties- According to contract act, these are the minor term of contract. As this is
impact on the performance of parties (Ang, 2013). In which parties are not able to breach their
duties which are imposed as per the law. Otherwise innocent party is able to file case against any
person in order to recover their damages which are caused to them.
Condition- It means every party is responsible to perform their duty which are imposed
on them as per the law. It is able to determine the party's obligation. This can considered as
general condition which are same to all types of contract.

Implied terms- These terms are not stated or not in the written form but must be valid
according to the act. Some points of these types of terms are as follows:
 Reasonable- Terms must be reasonable as well as equitable. It can able to
imposed burden on parties.
 Obvious- These factors are so obvious which have to be fulfill parties. In case
Codelfa Construction Pty Ltd v State Rail Authority of NSW, it has been clear
that, the term which is related inability of construction firm in order to work in
three shift in a single day. As the situation is not implied because it was unclear.
 Consistency- These types of terms are not contradict in the form of express term.
 Clear expression- There is no technical knowledge id required.
Express terms- These terms are those on which both parties are agreed to perform their
duties which are in the written form (Cross and Miller, 2011).
Exemption clause- It is an legal agreement in the valid contract which stipulates that
parties are excluded from liability. This can be unfairly used which is the disadvantage for them.
Incorporation of these terms are as aligned below:
 Incorporation by signature- If this clause is in the written form then it must be
signed by both parties and then it becomes the part of contract.
 Incorporation by notice- The exclusion clause is also incorporated by notice. The
notice must be given by before the formation of clause and must be signed by
both parties.
TASK 2
2.1 Apply elements in given case scenario.
Offer- On the basis of given scenario, it has been clear that, offer is made by the George,
Smith & Fogarty, Inc., a large IT firm and which is accepted by Devi. In this case the agreement
is framed and both the parties are mutually agree in the same thing and same sense.
Agreement- According to the given scenario, seller wants to sell brown leather couch in
approx 600 pounds (Yusoff, Isa, Aziz and Chin, 2012). The seller show intention by advertising.
And Carol wants to purchase the product and show his consent through mailed seller for
purchasing the couch. Their is an legal agreement has been made by both parties and try to
perform their duties as well.

Consideration- In given scenario it has been defined that, George, Smith & Fogarty, Inc.,
a large IT firm hired Devi for the firm. On April 12, 2015 they made an offer to Devi which is
accepted by him as well. But his father name called Preston, felt that Devi might not be the
employee of that company (Revak, 2011). Preston mailed to George and promised to give
150,000 pound if they do not hire Devi. The same mail is received them and firm wants to
enforce the contract because the act which performed by the Preston is nor enforceable by law
and it is the unethical behavior.
2.2 Effects of terms on legal contract.
Exclusion clause- In this legal term, one party is not responsible for the certain
happening events. In the given case it has been stated that, two person went into the hotels and at
the entrance the man handed over his overcoat which contained 500 pound in his wallet (Joint,
and Baker, 2011). There is the exclusion clause that hotel already noticed that, the entire valuable
products must be removed form the jacket pocket after that restaurant is not responsible for
stolen or missing of their valuable goods. At the time of payment the man realized that the
money had been taken from the wallet. In that, restaurant is not responsible to pay damages for
the same.
Implied term- According to given scenario, parties have to accept implied terms which
are imposed on them as per the law. Aaron is the person who rented warehouse from Zehphra.
This person promised to Aaron, that he not increased rent to next 5 years. But he made some
improvement in the warehouse. After some time Zehphra died and her daughter Yeti
immediately increased the rent. Both parties terminated the tenancy and claiming bill to receive
compensation for the expenses. So that, according to the contract act Aaron is able to receive
compensation from Yeti for the expenses which is incurred by them.
TASK 3
3.1 Similarities and differences of liability.
The liability which is arise when one party assumes on behalf of other party then which
name called contractual liability. Which are different types re as follows:
Strict liability- In this person becomes responsible for the things which are goes wrong. It
means defendant is fully for the injury which is conducted by other party.

Vicarious liability- In this legal concept principal and liable for the act which is
conducted by their agents (Miller, 2013). They are responsible to pay compensation if any
wrongful act is done by his agents.
All above mentioned liabilities are enforceable by law which define various types of rules and
regulation which have to follow by all parties those imposed on them as per the act of law.
3.2 Negligence liability.
Liability of negligence has been arise when one party breaches the duty of care which
owed to others. Some elements of this legal factors are as defined below:
Duty of care- There must be duty of care which is imposed on one person and have to
fulfill by them. If person failed to do so then he is liable to pay compensation for the same.
Breach of that duty- This liability has been arise when duty imposed on one party and
which has been breached by them.
Breach harmed to other person- If there is case of breach of duty then must be harmed to
another person then the case is called as Negligence.
Damages- If the damages has been caused to another party then this legal liability is
arises. It as like a prof as per the law.
If above mentioned factors are fulfilled as per the law then claimant is able to file case
against other party and try to receive damages which are caused to them.
For example- A a person who traveling in the plain and placed his guitar into their custody.
When he reached to his destination he released that guitar was damaged. In that case, staff
members are responsible to take care his guitar which is breach of duty (Aspect Of Contract And
Negligence For Business, 2017). So that, A is able to file case against them and receive
compensation as well.
3.3 Vicarious liability.
Vicarious liability is arises when one person is liable for the act or omission of another
person. In the workplace employers are liable for the action which is done by their workers in the
course of employment. Organization is vicariously liable for the act which is done by their
employees during employment. They are responsible to pay compensation for the act which is
done by them.

Case : In case Panorama Developments (Guild ford) Limited v Fidelis Furnishing Fabrics
Limited, 1971, has been stated that, the company secretory fraudulently hired cars for the
purpose of his own use without concern with managing directors. He continuously enter into the
contract with the name of company. If any case regarding damages has been arise then company
is responsible to for the act which is performed by company secretory on behalf of name of
organization.
TASK 4
4.1 Apply the elements of negligence of tort in the given case scenario.
The liability of negligence is arise when one party is responsible to take care of another
party but they failed to do so (Chetwin, 2011). Then the person is liable to pay compensation for
the act which is breach by them and according to law which is not valid.
As per the given case scenario, Mr Brown is the person who went Goodmayes hospital
for complaining of chest pain and breathing problems. He called to doctors and they instructed to
give pain killers to them for the purpose of pain relief. After some time the patient is died due to
non providing services by the staff members. In that case, liability of negligence is arise for
which non performance of act of doctors. Further, it is legal duty of doctors to take care their
patients and try to provide proper health care services to people and improve their standard as
well.
According to the contract act, people have to follow rules and regulation which are
imposed on them as per the law and they have to perform their duty which are imposed on them.
4.2 Vicarious liability in the given case.
As per the given scenario, the Chauffeur company appoint a driver and sent him for
pickup the client (Conrad, 2011). While waiting for the client he purchased glasses of alcohol
and out of limit drink. For the same reason his car was unbalanced and client suffered with
injury. And file claim against company. In this case, company is liable for the action which is
done by the driver. Organization is responsible to compensation to client.
CONCLUSION
On the basis of above report it has concluded that, every legal agreement is stated as
contract. In which two or more parties comes in the contractual relationship and try to fulfill their

duties which are imposed on them as per the law. There are various types of elements such as
offer, acceptance, intention to create legal relation, consideration and capacity to contract. These
element must be present in the legal contract and forming the agreement. Also has been formed
from various types such as face to face, written and distance selling. The written agreement must
be signed by both the parties and they must be agree same thing in the same sense. In case of
vicarious liability, one person is liable for the act which is done by other person. As organization
is responsible to pay compensation if the action or omission is done by their employees. Liability
of negligence is arise one party is liable to take care other party but failed to do so.

REFERENCES
Books and Journals
Ang, Y.S., 2013. Solutions to outsourcing abuses: The creation of collective obligations through
multilateral contracts (Doctoral dissertation, University of Birmingham).
Chetwin, M., 2011. Comparative analysis of some aspects of assessment of damages for
contractual breaches in England and Wales, Australia and New Zealand. International
Journal of Law in the Built Environment. 3(2). pp.113-125.
Conrad, M., 2011. The business of sports: A primer for journalists. Routledge.
Cross, F.B. and Miller, R.L., 2011. The Legal Environment of Business: Text and Cases: Ethical,
Regulatory, Global, and Corporate Issues. Cengage Learning.
Joint, A. and Baker, E., 2011. Knowing the past to understand the present–issues in the
contracting for cloud based services. Computer Law & Security Review. 27(4). pp.407-
415.
Marks, R.J., Marks, R.J. and Jackson, R.E., 2013. Aspects of civil engineering contract
procedure. Elsevier.
Miller, S.K., 2013. The best of both worlds: Default fiduciary duties and contractual freedom in
alternative business entities. J. Corp. L.. 39. p.295.
Moomjian, C.A., 2012, January. Drilling Contract Historical Development and Future Trends
Post-Macondo: Reflections on a 35 Year Industry Career. In IADC/SPE Drilling
Conference and Exhibition. Society of Petroleum Engineers.
Revak, H., 2011. Corporate codes of conduct: binding contract or ideal publicity. Hastings
LJ. 63. p.1645.
Stempel, J.W., 2010. The Insurance Policy as Social Instrument and Social Institution.
Wong, G.M. and Deubert, C., 2010. The Legal & Business Aspects of Disability Insurance in
Professional and College Sports.
Yusoff, S.S.A., Isa, S.M., Aziz, A.A. and Chin, O.T., 2012. Corporate responsibility via
Malaysian contract law, a concern for consumer protection. Pertanika Journal of Social
Sciences and Humanities. 20(1). pp.227-38.
Zamore, J.D., 2016. Interference with Lawful Business (Vol. 2). Business Torts.
Online
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through:<https://www.lawteacher.net/free-law-essays/contract-law/aspect-of-contract-
and-negligence-for-business-contract-law-essay.php>. [Accessed on 15th May 2017].