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Aspects of Contract and Negligence for Business- Report

   

Added on  2020-01-28

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Aspects of Contractand Negligence forBusiness1

TABLE OF CONTENTSINTRODUCTION...........................................................................................................................3TASK 1............................................................................................................................................31. Importance of essential elements required for the formation of a valid contract....................32. Impact of different types of contract........................................................................................43. Terms in valid contract............................................................................................................54. Elements of contract in the given business scenario................................................................55. The consequences of classifying terms ...................................................................................66. The law on terms and exemption clause in contracts..............................................................7TASK 2............................................................................................................................................71. Contrast liability in tort with contractual liability....................................................................72. The nature of liability in negligence........................................................................................83. How business can be vicariously liable...................................................................................94. Apply element of tort of negligence and defences...................................................................95. Element of vicarious liability in the given business situations..............................................10CONCLUSION .............................................................................................................................10REFERENCES..............................................................................................................................112

INTRODUCTIONLaw is termed as legal document that is imposed by the governmental authorities whichpossess different rules and regulations that are enforced to regulate the society (Zamore, 2014).In order to formulate a valid contract, parties are abided to follow the laws that are imposed bythe government so that they may not harm each other by performing unethical activities. Thepresent report focuses on different aspects of the contract and negligence that negotiate thecontractual and non-contractual agreement among different parties. Furthermore, the report alsoexplains about the essential elements that are required to formulate a valid contract that are citedby different cases. The report will also contrast the tort liability with contractual liability. While,the report will also measures that it is the duty of employer to review and take care regarding theactivities of employees. TASK 11. Importance of essential elements required for the formation of a valid contractValid contract is defined as an agreement between two or more parties that is legallyenforced by law. For the formation of a valid contract, it is essential for the parties entering intothe contract to focus on different essential elements so that contract can be termed as valid.Different elements of valid contract are-Offer and acceptance- The foremost essential elements that are required for theformation of a valid contract include valid offer and acceptance (Taylor, 2011). Theremust be legal acceptance of offer by the party that is provided by another party. The partywho accepts the offer should enter into contract without making any condition ormodification in the offer. However, the offeror who is making an offer must haveintention to be in the contract. For example, Harvey v Facey [1893] AC 552, as per thecase while sending telegram to Harvey, Facey mentioned that the lowest price was £900but he did not mention the intention to sale the pen for £900. Intention to create legal relations- Another element that is required for the formation ofa valid contract includes intention of both the parties to create legal and lawfulrelationship (Emerson, 2009). Therefore, social agreement or charitable agreementbetween the parties are not regarded as a valid contract. In accordance with the case of3

Balfour v Balfour [1919] husband promised his wife to send money for the maintenancebut after sometimes, he stopped sending money to his wife. Capacity of parties- Another key element that is required for the formation of a validcontract is that parties who are agreeing to form the contract must be competent enoughto enter into it (Emerson, 2009). For instance, parties must have the age of 18 whileforming the contract. However, parties or people with unsound mind, lunatic, minor oralcoholic are not entitled to form a valid contract. 2. Impact of different types of contractThere are various types of contract under which parties agree to follow certain terms aswell as conditions and form a contractual relationship (Frey and Frey, 2001). Diverse kinds ofcontracts are classified as follows-Unilateral contract- It is a form of contract under which one party makes general offer toanother party they are entitled to reciprocate towards the offer provided by the party. Inaccordance with the case scenario of Carlil vs Carolic Sml Ball Company 1893, thecompany advertised the reward of £100 for the one who has got flu by taking theirmedicine. Carlil saw the ad and used the medicine. Due to such action, he had got flu. Inaccordance to the company's advertisement, they were bound to pay reward to Carlil. Theimpact of unilateral contract is that offeror can revoke offer at any time before it has beenaccepted or completed by another party. But, it cannot be revoked if offree has started orbegun to reciprocate the offer. Bilateral contract- Another type of contract includes bilateral contract under which boththe parties who have formulated the contract mutually exchange the promises andperform their actions (Lawful consideration, 2011). This type of contract is also termedas two sided contract as both the parties exchange their promises to accomplish theirrequirement. For example, as per the case of Brogden v Metropolitan Railway (1877),suspect prepared a draft and sent to applicant but the applicant to whom draft was sentrevised and sent back to the party. The amended draft was kept by the defendant and notcommunicated with claimant regarding it. Therefore, claimant Brogden was sending coalto Metropolitan Railway that result in raising dispute. Thus, the impact of this contract isthat Metropolitan Railway was liable to pay Brogden for their services. 4

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