Aspects of Contract and Negligence for Business
Added on 2019-12-04
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ASPECTSOF CONTRACTAND NEGLIGENCEFOR BUSINESS
TABLE OF CONTENTSINTRODUCTION...........................................................................................................................3TASK 1............................................................................................................................................31.1................................................................................................................................................31.2................................................................................................................................................41.3................................................................................................................................................5TASK 2............................................................................................................................................62.1................................................................................................................................................62.2................................................................................................................................................62.3................................................................................................................................................7TASK 3............................................................................................................................................73.1................................................................................................................................................73.2................................................................................................................................................83.3................................................................................................................................................9TASK 4............................................................................................................................................94.1................................................................................................................................................94.2..............................................................................................................................................10CONCLUSION..............................................................................................................................11REFERENCES..............................................................................................................................12
INTRODUCTIONContracts and agreements are the significant factors in any business organisation. Theagreements and contracts between the two or more parties impact the business operations. Thebusiness environment nowadays is full of agreements and contracts. All the contracts areagreements but all the agreements are not contracts (Frame, 2012). The difference betweencontracts and agreements are the enforceability of law. When the agreements are enforceable bythe law, they become the contracts. The contracts are oral as well as in written form. The writtencontracts are lasts for longer period and these contracts has legal enforceability as well. Oralcontracts are also enforceable.TASK 11.1A contract is an agreement between two or more parties. It is understanding or promisebetween two parties to do something for each other. It intended to be enforceable by the law. Thefollowing are the essential elements for a valid contract:Agreements: An agreement includes offer and acceptance of both the parties. One partyneed to offer another party and the other party needs to accept the same. An acceptedoffer becomes an agreement. An agreement must be certain in nature which can be citedfrom the case of Carlill v Carbolic Smoke ball co. wherein the performer accepted theoffer of performing the prescribed task which was laid by the smoke ball company. Consideration: A legal contract require consideration. It can be anything. Theconsideration should be real and lawful. The contract without consideration cannot beenforceable by the law (Dove and Joly 2014). A consideration either shall be nominalrather than being adequate this can be cited from the case of Cirrie v Misa.Free consent: A legal contract must have free consent of both the parties. The consent ofthe parties should not be obtained by coercion, undue influence, fraud, misrepresentationand mistake. If the consent is made of any of these said factors, it cannot be enforceableby the law and it will not be called as valid contract. Intention to create legal agreement: As discussed above, Carlill v Carbolic smoke ballcompany is the major example of it wherein the defendant did not intent to create a legalagreement after proposing the ad in the newspaper.
Competency: The parties of any contract must be capable of doing contract. Thefollowing person cannot enter into a contract: minors, persons from unsound mind andpersons drunk at the time of entering into the contract. If these people enters into acontract, the contract becomes invalid.Lawful object: The objective of the contract must be lawful. The design or purpose of thecontract must be valid. If the objective is fraudulent, immoral or forbidden by the law thecontract may not become a valid contract (Daughety and Reinganum, 2014).Certainty of meaning: The meaning of the contract must be certain, it should be clear andunderstandable by the parties of contract. It should not be vague or unclear. Enforceability by law: A legal contract must have enforceability of law, it should not bedeclared as void contract by the law.1.2All the legal contracts are enforceable by the law. The relationship between the parties ofa contract is affected by the types of contracts. The following are the different types of contract:Unilateral and Bilateral contracts: Unilateral contracts are those contracts in whichofferer makes an open promise to a group of people. It is said to be a one sided contractbecause only offerer knows about the contract. Herein, one person is engaged in making acommitment and the other is engaged in performing the duty with reference to the Carlillv Carbolic case wherein the company made a promise to pay a certain amount to thewinner. In Bilateral contracts both promiser and promise enters into the contract. Oneparty promises to give or perform something for some consideration and the other partyaccepts that offer. Both the parties make certain amount of promise or commitment toperform.Simple contract and Deed contract: The parties in a simple contract can contract orallybut in, deed contract it should be in written form and is under sealed. The meaning of adeed is can be more clear as it is in written form, oral or simple contracts may not beclear all the time. The deed contracts are always enforceable by the law but simplecontracts may not be enforceable by the law all the time. Furthermore, the simplecontracts are either in the form of written, implied or verbal in nature (Boutigny and Saini2013).
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