Business Laws

This article discusses the fundamental elements of contract law, including offer, consideration, acceptance, capacity of the contract, and intention of attaining a legal relationship. It also explores the provisions of Australian Consumer Law, including the rights of consumers and the responsibilities of suppliers. Additionally, the article delves into the rules of valid consideration in contract law and exceptions to these rules.

Running head: BUSINESS LAWS
Business Laws
Name of the student
Name of the university
Author note

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BUSINESS LAWS
Answer one
Part A
Introduction
There are five fundamental elements on which the contract law is based. The elements are
mentioned as the offer, consideration, acceptance, capacity of the contract and intention of
attaining a legal relationship.
The abovementioned elements must be identified in between the communications that are taking
place among the parties so that a contract can be formed before the law. There can be no contract
formed if one of these five elements is not found in the contract. Acceptance and offer are those
elements that help in meeting the mindset of parties to form a contract. If the parties totally agree
to the terms then only a contract can be formed otherwise not. Therefore, these principles of the
agreement are totally based on the abovementioned rule.
Analysis
There must be an offer presented by the party rather than presenting an invitation to offer to
create a valid contract. A person who has the reasonable knowledge to present a valid offer must
be seen from his intention that he wishes to generate a legal relationship. The above-mentioned
principles have been discussed in the case named Lampleigh v Braithwait (1615) by the
court. In addition, it has been stated that if a party is making a declaration in the form of the
advertisement not considered as the offer until it is an individual offer that has been mentioned in
the case of Hartley v Ponsonby (1857). Further, it is held that by declaring an advertisement as
an invitation to an offer makes no legal sense and it has been stated in the case of Williams v

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Roffey (1990) because an individual was not able to fulfil the demands that have been presented
in the advertisement for the entire group. It is noted by the advertisement that the facts that have
been presented in it are made by a website that is owned by a person known as Magda to sale the
paintings. Therefore the advertisement of the painting has been seen as an invitation by the
principles of Scotson v Pegg (1861).
Sunday, February 19
Avinash has made an offer by buying the painting that has been priced for $1600. This offer has
been made via email by him. It has been stated in the case of Smith v Hughes that if a statement
has been made with the intention of binding another party to the terms of the contract and it is
legal then this offer is considered to be the valid offer and it has been stated by the court. In the
above-mentioned case a valid offer has been made by Avinash.
It is stated that if an offer is rejected by a counter offer then that offer ends and it is mentioned in
the case of Hyde v Wrench [1840] EWHC Ch J90. The term counter offer means a statement
that has been created against the offer and it is not considered to be as unambiguous. Therefore
the offer that has been prepared by Avinash has been rejected by a counter offer as Magda has
quoted for the painting’s higher price. Further, a supplementary condition was asked for, by the
similar principles by Avinash. Therefore, no valid acceptance was there.
A valid offer has been made by Avinash according to which the painting had to be given to him
at the cost of $1800 as the validity of this offer was until 21st February.
Monday, February 20

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There was another counter offer that was created by Avinash because he has asked for the
authenticity certificate and it has been mentioned in the principles of the case of Hyde v
Wrench. This does not seem to be an ordinary inquiry. Magda made an offer and its validity was
till 4 p.m. The offer's validity had been revoked by Magda to 20th February 4 pm from 21st
February by letting know Avinash and these things has been presented in the case of Bryne &
Co v Leon Van Tien Given & Co [1880] 5 CPD 344. However, it is not accepted by Avinash
and it got elapsed because of the time at 4 p.m. on the date of 20th February as per the case of
Ramsgate Victoria Hotel v Montefiore (1866) LR 1 Ex 109.
Tuesday, February 21
The availability of the offer was not there that needs to be acknowledged and therefore no
contract was formed between Avinash and Magda.
Conclusion
As per the above-mentioned information, no contract was present between Avinash and Magda
because the acceptance time has been changed by withdrawal to 20th February 4 pm.
Answer one
Part B
Issue
As per the provisions that have been mentioned in Australian Consumer Law that what are the
rights that can be carried by Elton that has been created through schedule 2 of the Australian
competition and consumer act 2010 (cth).

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BUSINESS LAWS
Rule
An individual shall be considered the consumer of Australia only if that person relates to the
provisions that have been mentioned in section 3 of the Australian consumer law. A person can
only be considered as an Australian consumer if the price that has been paid to obtain the
services and goods must be less than $40,000 and only if the services and goods has been
purchased for the household or domestic purpose or if there is any vehicle that has been bought
for the transport. The above-mentioned section can only be applied if these purchases are not
done for the purpose of production and resupply.
The Section 18 of the Australian consumer law has imposed a responsibility on the supplier by
which they do not have the right to commit an act that is in the way of commerce and trade and
can be considered as deceptive or misleading or expected to deceive or mislead.
There are certain provisions that have been mentioned in Section 56 of Australian consumer law
and they state that the guarantee has been given to consumers. It has also been mentioned that
where the sale of a good or service been taken place by a description that seems to be
compulsory and those goods exact as mentioned in the description that has been provided to
them.
The above-mentioned rules that are related to the act as deceptive and misleading that have been
mentioned in the principles of Section 18 of the Australian consumer law and it has been
discussed by the case of ACCC v Reckitt Benckiser (Australia) Pty Ltd [2016] FCAFC 181.
There was no accurate information that has been given in the advertisement and the
advertisement has been stated as deceptive and misleading by the court and all these have been
stated in the above-mentioned case.

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According to the rules of section 260 of Australian consumer law, it has been stated that where
the guarantee of the consumer has been breached the party has the right to reject the courts and
can ask for a refund.
Application
The facts that have been stated in the case that the painting which was sold by Magda to Elton
was not trusted on the paper that was of high quality as it has been stated in the website and
therefore, it has the possibility of losing out the colors which have already taken place. This
couldn't have taken place if the Portrait was printed on a good quality paper. As it was promised
by the advertisement the portrait that was sold was not at all a limited edition. Therefore this
situation states that the requirements of section 18 and 56 have been violated. This happened
because it did not match with the description that has been provided and the portrait was not
printed on the paper that was of high quality. Therefore, the provision that has been mentioned in
Section 56 has been breached. Furthermore, as stated in the website the painting was not at all a
limited edition and according to the application of section 18 and of the case of ACCC v Reckitt
Benckiser it has been mentioned that this function has been regarded as deceptive or misleading
or it is expected to be deceived or mislead. Therefore Magda is responsible under the section 18
and Elton has the right to discard the portrait that has been mentioned under the section 261 of
the Australian consumer law.
Conclusion
As Elton is the consumer of Australia he has the right to discard the goods as per the provisions
that have been mentioned in section 261 of the Australian consumer law.
Answer two

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With respect to the contract law consideration associated to promise and because of that contact
is made among the parties. Every party who is associated with the contract is given a benefit and
they also have to suffer a disadvantage. These benefits and disadvantages with respect to the
parties to the contract are termed as consideration of the contract. Consideration means
"something of a value".
Certain rules have been provided that makes a consideration valid at law. The rules mentioned
indicates that any act that has been made in the past does not consider to be a consideration and
they do not have to obey the values that the other party has promised. Therefore the above-
mentioned rules indicate that the consideration that is under the contract law may not be valid
always and it might also lead to some situations that are not needed for the parties who are in the
contract. Certain cases have been mentioned by the court in which these rules have been set up
and has been discussed. In the case named Chapel v Nestle [1960] AC 87, a consideration has
been found by the court that needs to be valid and not adequate.
Valid consideration is regarded by the small amount that is given with respect to the promise. In
the case named Collins v Godfrey (1831) 1B & Ad 950 a prime example has been stated in
which the consideration is considered as invalid and cost advantage to the promisee. In the
above-mentioned case, it has been said that the police officer cannot claim for money that has
been promised as a consideration to him for giving the services of protection. The court stated
that it is the duty of the police to protect and it cannot be considered as a valid consideration and
there cannot be a contract that can be formed amongst the parties. A duty that already exists is
known as the contractual duty and it cannot be regarded as a valid consideration.

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There are certain exceptions to the above-mentioned rules and the principles are not stated to be
absolute. If a person goes beyond their contractual duty then that consideration will be
considered as a valid consideration and it has been stated in the case of Glassbrooke v GCC
(1925). If a person who is willing to claim the act that has been done before the contract has been
formed as the consideration then he is not permitted to do the same as mentioned in the case
named. This rule cannot be applied if this act has been carried as requested by the promisor.
There is another situation in which the promisee gets a disadvantage of the part payment of
debts. A situation has come out where an individual has already accepted the part payment as the
ultimate settlement but later on has made a claim with respect to the amount remaining and has
been successful in it and it has been done in the case named Alliance Bank v Broom (1864).If a
consideration is not legal in nature then it is considered to be as invalid.
However, in the above-mentioned situation, the equity principles can sometimes interfere so that
it can provide some assistance to the promisee. One of the rules under this principle is named as
the doctrine of promissory estoppel in which the promisor might be controlled to get back to his
promise as it has been debated in the case named Pao On v Lau Yiu Long (1980). As discussed
from the above-mentioned investigation it is seen that several situations are there in which a
consideration has been considered to be illegal and has also caused problems to the promisee.

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References
ACCC v Reckitt Benckiser (Australia) Pty Ltd [2016] FCAFC 181.
Alliance Bank v Broom (1864).
Australian competition and consumer act 2010 (cth).
Bryne & Co v Leon Van Tien Given & Co [1880] 5 CPD 344
Chapel v Nestle [1960] AC 87
Collins v Godfrey (1831) 1B & Ad 950
Glassbrooke v GCC (1925).
Hartley v Ponsonby (1857).
Hyde v Wrench [1840] EWHC Ch J90.
Lampleigh v Braithwait (1615)
Pao On v Lau Yiu Long (1980).
Ramsgate Victoria Hotel v Montefiore (1866) LR 1 Ex 109.
Scotson v Pegg (1861).
Smith v Hughes (1871) LR 6 QB 597
Williams v Roffey (1990)

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