Business Law

Running head: BUSINESS LAW
Business Law
Name of the Student
Name of the University
Author Note

1BUSINESS LAW
Table of Contents
Question 1........................................................................................................................................2
Question 2........................................................................................................................................4
Question 3........................................................................................................................................6
References........................................................................................................................................9

2BUSINESS LAW
Question 1
Issue
The issue is to advise Alex as to whether he has a contract with Bob for the sale of the
apartment.
Rule
According to the Singapore law a contract is created whether party
offers to do something for the other party who in return accepts that offer.
The exchange of offer and acceptance is extremely essential along with
the other essential elements like consideration and the capacity of the
parties to enter into the contract. An offer is a form of promise which is
either expressed or implied. The promise to form a contract should be bound
by offer and not an invitation to treat which is more like an advertisement
like putting up advertisement to sell a goods is not an offer while asking
somebody directly to buy goods can be considered as a valid offer. The
person who makes an offer is called the offeror while the one who accepts it
is called an offeree. The offeror can withdraw an offer any time before the
offeree accepts it. Like offer, acceptance must also be communicated to the
offeror. When communication for acceptance of an offer is made through
post, acceptance is effected the moment letter of acceptance is sent to
the offeror as per the postal acceptance rule (Rohagi, 2018).

3BUSINESS LAW
Along with offer and acceptance, the presence of a valid
consideration is also important for an agreement to be legally binding.
Consideration is the value which the parties to the contract agree to
exchange between themselves.
Application
In this case, Alex is the tenant of the apartment which is owned by
Bob. It was Bob who gave an offer to Alex, saying that he was interested to
sell the same apartment for $300000. After 3 days Alex sent a letter to Bob
agreeing to purchase the apartment for $300000. Here, Bob is the offeror as
he gives the offer to sell his apartment, while Alex is the offeree who
accepted Bob’s offer. Here, Bob telephoned Alex and cancelled the offer after
receiving Alex's letter of acceptance. Such an act breaches the rule of
contract law which states that an offeror cannot take back an offer after he
has received the letter of acceptance from the offeree. In this case, Bob's
offer to sell his apartment was clear and it did not constitute an invitation to
treat. Alex took three days to decide about the offer and reply back. These
three days was the time frame within which Bob should have rescinded the
offer. However, he chose to wait until Alex's reply regarding the offer.
According to the law of contract, at this stage of an agreement where an
offer and an acceptance has been lawfully accomplished along with a
mutually agreed proposal to exchange a valid consideration, an offer cannot
be rescinded by the offeror.