Business and Corporation Law Assignment 2022

Running Head: BUSINESS AND CORPORATION LAW
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Business Law Assignment
4/8/2020
Student’s Name

“Business Law Assignment”
1
Question 1
Issue
The issue of the case is to check whether a binding contract was there between the
shop and Graham or not.
Rules
For a valid contract, some elements need to be there such as offer, consent,
consideration, and intention of the parties. At the moment when all these elements
come together, a valid contract is formed. It means to check whether a valid contract
exists between the parties or not, it is necessary to check the presence of all these
elements. The offer may be oral or written and to be a valid one, the same requires
carrying clear conditions. In the case of “Harvey v Facey [1893] UKPC 1”, it was
provided that an offer must show the intention of the offeror to be bound (Merkin and
Saintier, 2019). As similar to the offer, an invitation to treat is another important term.
This term refers to a call for offers and in reply, to such an invitation, an offer needs to
make. The main difference between an offer and invitation to treat is that the later term
does not contain any intention to be bound. Here this is to state that an invitation to treat
always comes before an offer but need not to be present in each case. Since this term
does only represent invitation hence cannot be accepted. In the case of the
Pharmaceutical Society of Great Britain v Boots [1953] 1 QB 401, it was given that
goods are treated as an invitation to treat where they are displayed in a shop along with
the price (Davidson, 2015).

“Business Law Assignment”
2
Another element is consent (also known as acceptance) that needs to exist in a valid
contract. The offeree i.e. the person to whom the offer was made is required to give
such acceptance. In the case titled “Entorres v Miles Far East [1955] 2 QB 327”, the
court provided that for the validity of acceptance the same must be communicated to
another party i.e. the offeror. Further, the acceptance must be given for the same terms
as mentioned under an offer. The third element, which is necessary to develop an
agreement into a contract, is consideration, which is actually a motive behind the
creation of a contract. Consideration refers to the promise which parties makes each
other to pay and the same may exist in any legal form. It means a valid consideration
does not need to be in the monetary form. The last element demands both parties to be
serious about the contract and therefore must be intended to develop legal
relationships. In those agreements which are made in a commercial context, the law
takes an assumption that the parties have the intention to create legal relation as
decided in the case of “Esso Petroleum v Commissioners of Customs & Excise [1976] 1
WLR 1” (Taylor and Taylor, 2017).
Application
In the case given hereby, Graham and his friend visited an antique shop. Graham
inspected a table and asked the price of the same to the shop owner. To check the
existence of contractual elements this is to state that the goods mentioned in the shop
were only an invitation to treat applying the “Pharmaceutical Society of Great Britain v
Boots”. The offer of the case arrived when the shopkeeper informed the price of the
table to Graham. The terms of this offer were clear where the shop assistant offered to
sell the subjective table for a particular value i.e. $5000. Another element of the valid