Aspects of Contract and Negligence for Businesses

Running Head: ASPECTS OF CONTRACT AND NEGLIGENCE FOR BUSINESSES
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ASSIGNMENT NAME: ASPECTS OF CONTRACT AND
NEGLIGENCE FOR BUSINESSES

ASPECTS OF CONTRACT AND NEGLIGENCE FOR BUSINESSES 2
Table of Content
Introduction......................................................................................................................................3
Task 1: An insight into contract formation......................................................................................3
1.1 Contractual elements.................................................................................................................3
1.2 Different contractual impacts....................................................................................................4
1.3 Meaning and effect of the contractual terms.............................................................................4
Task 2: Application of elements of contracts in the business situations........................................5
2.1 Application of the contract elements in the given business scenarios.....................................5
2.2 Application of the legal terminology in the provided contracts................................................7
2.3 Evaluation of the effects of the provided terminology in the given contracts...........................8
Task 3: The principles of liability in negligence in business functionalities...................................9
3.1 Contrast liability in tort with contractual liability.....................................................................9
3.2 Explain the nature of liability in negligence............................................................................10
3.3 Explain how a business can be vicariously liable....................................................................11
Task 4: Be able to apply principles of liability in negligence in business situations....................12
4.1 Apply the elements of the tort of negligence and defences in different business situations...12
4.2 Apply the elements of vicarious liability in given business situations....................................12
Conclusion.....................................................................................................................................13
Reference List................................................................................................................................14

ASPECTS OF CONTRACT AND NEGLIGENCE FOR BUSINESSES 3
Introduction
Contracts form a central doctrine in terms of partnership between two persons or organisations.
Compliance to the levied terms and conditions enhances this partnership. Viewing it from
another perspective, breach of contract destroys the stability between the two parties. This action
establishes negativity to the contract and spoils its true essence. This assignment speculates the
basic aspects related to the contracts, which helps in analysing its effect on the organisational
operations.
Task 1: An insight into contract formation
1.1 Contractual elements
A contract is formed of certain elements, absence of which turns it into an invalid one.
Adherence to these elements would help Peter to build his career as a self-employed building
contractor (Clarke and Lancaster, 2013, p.222).
Agreement is one of the essential components for a contract to be a valid one. In this element, an
offer is proposed by a party, which is accepted by the opposite party. The earlier sentence
projects two important subparts of agreement, that is, offer and acceptance (Schulze and
Staudenmayer, 2016, p.29). The acceptance of the proposed offer leads to the agreement between
the two parties. Viewing it from another perspective, agreement projects the adherence to the
ethics of the contract. In case of breach of contracts, the opposition party possesses full right to
expose disagreement to the proposed offer. This sentence bear’s resemblance with the
understanding of Peter that he can be sued for any kind of damages that might arise during the
tenure of the contracts.
One of the other elements is consideration. Consistency within the proposed guarantees makes
this element into a worthy one (Callea et al. 2014, p.400). This contractual element proves useful
for Peter is he encounters breaches of contract regarding his property, cash and other
administrative losses.
Capacity is one of the other crucial components in terms of a valid contract. The parties
possessing adequate understanding of the terms, conditions and liabilities are benefitted through
this element. This understanding provides them the access to enter into contracts with their
partners. This element might not be of any help for Peter at the initial stage, however, achieving
adequate understanding about the dynamics of contracts would aid him in engaging into
contracts with builders or property dealers (Davis et al. 2016, p.730).

ASPECTS OF CONTRACT AND NEGLIGENCE FOR BUSINESSES 4
Consent holds equal importance in the formation of a valid contract. Without the consent of the
statutory bodies of law, no persons can enter into a contract. This condition is applicable for the
parties involved in the contract. Finding the adoption of illegal means by any of the parties turns
the contract into an invalid one. This action needs courtly intervention into the contract and
results in cancellation of the contract. Upon encountering any such means undertaken by the
opposition party, the other party possess full right to reject the proposed offer. This action
possesses two connotations (Ralston and Weber, 2014, p.253). One it projects the understanding
of the opposite party regarding the terms and conditions of the contracts. On the other hand, it
reflects the conscious attitude towards remaining true to the ethics of the contract.
Exposure of consent to the proposed offer enhances the clarity of the parties towards the terms
and conditions of the contracts. This motive establishes authenticity into the execution of the
contracts.
1.2 Different contractual impacts
Performance of every task with efficiency results in the achievement of positive results. On the
contrary, expose of lackadaisical attitude compels an individual to get negative outcomes. The
same can be applied to the activity of contracts. Presence of variety within the contracts
simultaneously possesses various effects (Kirichenko, 2016, p.175).
Contracts are mainly of two types, bilateral and unilateral. The name unilateral itself projects the
presence of one single entity. In this type of contracts, the terms and conditions levied by the
court is abided by the person intending to indulge into the contract. This type of contracts needs
the understanding and capability of the promissory to fulfil every criteria of the contracts.
Entering into these types of contracts after attaining adequate experience would prove helpful for
persons such as Peter.
In case of bilateral contracts, there are two parties, who are bound to abide by the terms and
conditions of the contracts (Mateescu, 2015, p.255). Breaches of contracts put the blame on the
culprit party and provide the opportunity to the victim party to file suit against the opposition
party. Presence of two parties strengthens the base of the contract and qualifies it as a valid one.
1.3 Meaning and effect of the contractual terms
Compliance to the regulation of a contract results in the fulfilment of the contractual needs. This
action reflects the true essence of the contractual term, condition. Deviation from these condition
compels the statutory body of law to interfere into these contracts and declare it as an invalid