Australian Business And Contract Law

BUSINESS LAW

Contents
Part A.........................................................................................................................................2
Issue:......................................................................................................................................2
Rules:.....................................................................................................................................2
Application:..........................................................................................................................3
Conclusion:...........................................................................................................................4
Part B..........................................................................................................................................4
Issue:......................................................................................................................................4
Rules:.....................................................................................................................................4
Application:..........................................................................................................................5
Conclusion:...........................................................................................................................6
References..................................................................................................................................7

Part A
Issue: The key issue is to evaluate each of the steps involved between the parties John and
Span and Spic that led to the contract of dry cleaning of suit between the two. Hence, the
discussions would involve the review of each of the steps in the light of the legal contractual
agreement.
Rules: The legal rules are comprised in the Australian Contract Law that is the prime
governing legislation regarding the formation, management and the execution of the
contracts. The legislation states that the essential conditions must be fulfilled for an
agreement to be regarded as enforceable in the courts, in the form of a valid contract. In
context of Australia, there are five key conditions that must be complied by the parties
intending to form a contract (Latimer 2016). A detailed elaboration of the conditions along
with the applicable case laws is indicated as follows.
Offer and Acceptance
The very first condition is related to the offer and acceptance. The condition is fulfilled when
one of the parties intending to form a contract extends an offer to the other party, and the
same is accepted by the other party in the absolute form. By offer it is understood that one
party describes its intentions in the form of a proposal for something to be done, or not to be
done. It does not matter whether the said communication is in the oral or written form, but
what matters is the terms of the contract are clearly stated in the offer, to be understood by
the parties as they are. The offer when accepted becomes an agreement between the parties.
The acceptance must be in absolute form. When the other party puts an additional condition,
in response to an offer, it is known as a counter offer and not an acceptance. The significance
of offer and acceptance has been stated in the different case laws, including the Empirnall
Holdings Pty Ltd v Machon Paull Partners Pty Ltd (1988) 14 NSWLR 527, in which it is
stated that both the offer and acceptance must be duly communicated.
Certainty of terms
In addition, the terms of the contract must be certain for both the parties to be understood in a
similar manner. The terms of the contract is defined as the description of the obligation of the
parties, that an act to be done or not to be done. While, some terms of the contracts are
expressed and some of the contractual terms are implied. It is essential for the meeting of the
minds of the parties to the contract. Thus, the terms must be certain in all respects.