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Business and Corporations Law

   

Added on  2020-03-28

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1BUSINESS AND CORPORATIONS LAWNameCourseDate

2Answer 1The case between Helena and Ringo is about an agreement in which one party is intending to withdraw from the contract before the agreed period. Helena wants to withdraw from the agreement due to frustration, which is caused by poor performance ofher business at location leased to her by her brother Ringo. On the other hand, Ringo feels that he will lose his financial flow and business incase this happen. Because of theuncertainty, Ringo decides to sue Helena claiming $6000 that he might lose in case sheterminates the contract. Therefore, this paper intends to advice Helena the likelihood of Ringo’s success in filing the case against her. A contract is a promise or various promises that is lawfully binding.1 It is formed when there is an offer, acceptance, and consideration. Once there is an agreement, each party is obligated to perform his or her part in relation to the terms of the contract.2Where a party has completely performed his responsibility as stated in the contract, he is no commitments but has the privileges to force the performance of the accord by the other party. Under a unilateral discharge, consideration needs to be provided so that to make the accord enforceable, unless the agreement is under seal. In this case, it is clear that there was an offer from Ringo, which Elena accepted, and therefore, it is up toeach party to fulfill his or her responsibility under the contract. Elena should continue paying for the lease as per the reduced $2,000 but if she fails to abide with the agreement then she would have breached the contract. A breach of contract happens when one party fails to perform his or her obligation as per the contract. Success of Ringo in this case will depend mainly on the remedies provided to him under commercial law.BreachA breach that can be treated as thoughtful enough to grant the non-breaching party the choice of viewing the contract as discharged in either the following two ways: Firstly, one party may show by express words or by implications from her behavior before performance is due by saying that she does not propose to observe her 1Doris, M. (2014). Promising options, dead ends and the reform of Australian contract law. Legal Studies,34(1), 24-46.2Davies, C. (2009). Outsourcing contracts and remedies. Communications Law: Journal Of Computer, Media & Telecommunications Law, 14(1), 20-23.

3responsibilities as stated in the contract.3 Secondly, she may halt a term or the contract in a way that it results to a significant failure of consideration. However, this seems not to be what Elena has decided to do. The non-breaching party, which in this case is Ringo is has no responsibility to wait until the date for performance, but then again may instantly treat the deal as an end and sue Elena for damages. This was applied in the Hochster v De La Tour(1853) 2 E&B 678 case.4On the other hand, if the innocent party within a reasonable time fails to indicate that he accepts the repudiation of the other party for the contract to be discharged, it willthen remain open for the advantage and risk of both the parties. Therefore, it is vital thatRingo accepts Elena’s repudiation before time elapse as it was in the Avery v Bowden(1855) 5 E&B 714 case.5 If Ringo decides to continue with the agreement after the anticipatory breach by Elena, he is not pardoned from offering his duties as stated inthe contract. Subsequently, Elena could not be liable if Ringo was consequently in violation of the deal. However, whether the violation results to repudiation will only rest on the genuine states of the case. RemediesIn a situation where there is a breach of contract, the innocent party is permitted to remedies. Particularly, they are permitted to damages as a right as witnessed in O’Connor v SP Bray Ltd (1936).6 A contract may be discharged mainly through performance. It means that the contractual obligations must be performed in full and exactly. Therefore, some of the remedies that Ringo may have include damages and equitable remedies. Damages for breach of contract are seen as an alternative for performance. Subsequently, damages claim are meant to put the accuser in the place they would have been if the contract could have been fully performed. The loss by the aggrieved party must not be too distant from the violation and the grieved party must do what is sensible to decrease the damage suffered. Therefore, in any case Elena 3Edward, W. (n.d). Real Property - Disputes about land contract breach preclude summary disposition. Michigan Lawyers Weekly.4Posner, E. A., & Sykes, A. O. (2011). Efficient breach of international law: optimal remedies, "legalized noncompliance" and related issues. Michigan Law Review, 110(2), 243-294.5Gergen, M. P. (2009). A theory of self-help remedies in contract. Boston University Law Review, 89(5), 1397-1449.6Ibid.

4terminates the contract, she will be held culpable for breaching the contract, and therefore, must pay for the damages incurred by Ringo. Additionally, in line with the common law remedies, parties may pursue the equitable remedies of specific performance. Even though this is not available as a substance of right, they are granted at the discretion of the court. Other than that, the injured party may also apply the equitable remedies. Equitable remedies are divided into two namely; specific performance and injunctions. Wrongful Termination of a ContractTermination is the ending of a contract before all the conditions of the contract have been successfully performed. Wrongful termination happens when there is inadequate justification for termination as stated under the general principles of the contract law or as stipulated on the contract. It may also occur when the termination is not authorized by the terms under the contract. Furthermore, wrongful termination may occur if one or more of the processes needed for a proper termination under the contract conditions are not properly followed.7 On the other hand, wrongful termination is a rejection of the contract which in its nature is a material violation of the contract. It provides an opportunity for the innocent party to pursue damages caused. However, thenon-breaching party must prove the existence of the loss.8Additionally, under the contractual termination, the agreement may have various categories of loss that can get recovered and the confines on recovery. The common law of termination that must prove that the violation is material or substantial, could increase the damage recovery cost because of a specific condition that might not come into play with a contractual termination. Common law termination states that once there a material or substantial breach, the grieved party should be permitted to recover enough to get where he would have been if the contract had been properly finalized.9This includes loss of profit as well as other damages. Answer 27 Ibid.8Jimenez, M. J. (2008). The value of a promise: a utilitarian approach to contract law remedies. UCLA Law Review, 56(1), 59-126.9Posner, E. A., & Sykes, A. O. (2011). Efficient breach of international law: optimal remedies, "legalized noncompliance" and related issues. Michigan Law Review, 110(2), 243-294.

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