Business Law and Ethics - Desklib

Running head: BUSINESS LAW AND ETHICS
Business Law and Ethics
Name of the Student
Name of the University
Author note

1BUSINESS LAW AND ETHICS
Answer to Question 1
Issue
The issue that is related to this scenario is whether Fran can hire Jane as an alternative of
Marco.
Rule
The law in this scenario states that for a creation of a contract, there must be two parties
involved by having a legal intention. The purpose of legal intentions is to form legal
obligations. According to the Law of Contract, the parties are suppose to bind upon the
control with proper intention. Consideration is formed between the parties when there are
legal relations between them. Therefore, the consideration acts as an evidence when the
contract is formed. The factual situation of the scenario states that it was agreed upon by the
promissor to clear out the remuneration for the purpose of fulfilling the promise.
Ermogenous v Greek Orthodox Community of SA Inc (2002) 209 CLR 95 stated that
there was use of presumptions that led to a decision that the parties did not have any kind of
legal intention in this case without the entire consideration of the status consisting the
contract formed1. However, the courts generally assume and decides that the parties engaged
in the contract are not bound legally.
Application
It was noticed that there was a formation of an agreement between Fran and Marco. This
particular agreement had the consent of both Marco and Fran. When the law was applied in
such a case, it was observed that there was an existence of an intention to create legal
relations. Therefore, the contract could not be avoided by Fran since Marco was his brother
1 Ermogenous v Greek Orthodox Community of SA Inc (2002) 209 CLR 95

2BUSINESS LAW AND ETHICS
who was the other party associated with the contract. Presumptions and assumptions should
not be considered in a situation when the parties have proved that they had legal relations.
Conclusion
It can be concluded from the scenario that a valid contract was formed by Fran and Marco
and hence it could not be ignored by Fran.
Answer to Question 2
Issue
The issue of this scenario is whether the concept of promissory estoppel can be applied in the
case of Octavia and Fran.
Rule
From withdrawing a promise made by another that can be prohibited is known as promissory
estoppel. When a promise is created without any kind of consideration, that contract will not
be called to be an enforceable one. Common Law suggests that not every kind of estoppel are
similar as compared to the other ones. Coulls v Bagots Executor & Trustee Co Ltd (1967)
119 CLR 460 explained that promissory estoppel can be applied only when there is
unambiguous statement where he does not propose to enforce the legal rights2. According to
the law of contracts, promissory estoppel produces that kind of a situation where if either of
the parties modify his or her position based on gratuitous promise it will be treated as a
promissory estoppel.
Application
2 Coulls v Bagots Executor & Trustee Co Ltd (1967) 119 CLR 460