Case Study Based on Different Aspect of Contract Law
Added on 2020-03-23
8 Pages2030 Words129 Views
CONTRACT2IssueThe key issue in this case relates to the possibility of a claim being made by Miles againstFarmquip for a possible breach of contract for the return of the sum paid or for claiming the compensation money. RuleA contract is best defined as a legally binding promise made under an agreement. Under acontract, one party promises that they would do the act mentioned under the contract and the other party promises that they would pay the requisite compensation amount as is stated under the contract (Blum, 2007). It can be formed in an oral and in a written way. In the first manner, the contract terms are spoken orally and in the latter, the contract terms are put down in writing on a document, which the parties to that particular contract sign (Mau, 2010). For creating any contract, there is a need of some specified components to be present. These components include the offer, the acceptance, consideration, capacity, clarity and intention (Miller & Cross, 2015). Amongst the key points with regards to these components is offer and invitation to treat. An offer is the initiation point of the contract whereby one party offers certain terms to another party. An invitation to treat, on the other hand, shows that the parties are ready to negotiate upon the possible contract (McKendrick & Liu, 2015). Hence, invitation to treat takes place before the offer is made; though, is not obligatory to be present in every case. The advertisements in the newspaper are an example of invitation to treat. The goods which are kept on the shelf of the shop, for display, are another example of invitation to treat. And in such cases, the individual is
CONTRACT3not bound to sell such product as per Pharmaceutical Society of Great Britain v Boots [1953] 1 QB 401 (Latimer, 2012). The other elements of contract include the acceptance of this offer. So, once an offer has been made, it needs to be accepted. There is a need for the contract to have valid consideration inorder for the contract to be valid. As per this requirement, the consideration needs to have an economic value (Stone and Devenney, 2017). There is also a need for parties to have the capacityof entering into the contract. In this regard, the parties need to be of legal age and also need to beof sound mind to be able to make rationale decisions for them. The parties need to be clear about the terms of the contract as this gives the parties the rights and liabilities under the contract. And lastly, there is a need for the contracting parties to have the intention of creating legal relations. When the terms covered under the contract are not fulfilled, the aggrieved party can apply for monetary compensation or equitable remedies (Andrews, 2015). At times, under the contract a clause known as exclusion clause is found, which has the power of restricting or limiting the liabilities which are raised due to the contract. The exclusion clauses are relied on to extinguish the liability of the contracting party. In order for an exclusion clause to be valid, it has to fulfil some requirements (Clarke & Clarke, 2016). Firstly, the exclusion clause has to be inserted in to the contract in a proper manner. Secondly, the exclusion clause needs to be brought to the attention of the party against whom it is being inserted. The exclusion clauses can only restrict the liability under the contract and not such which are born out of a statutory law or common law (Ayres & Klass, 2012). In order for the exclusion clause to be valid, it has to be inserted in the contract before it is signed by the parties. Olley v Marlborough Court Ltd (1949) 1 KB 532 saw the exclusion
End of preview
Want to access all the pages? Upload your documents or become a member.
Related Documents
BLO1105 Business Law Assignment Victoria Universitylg...
|16
|2983
|50
(Solved) Business Law Assignmentlg...
|11
|2444
|148
Business Law Assignment: Contract Formation and Elementslg...
|10
|2619
|339
Formation of Contract, Key Components and Legal Validitylg...
|11
|2844
|171
Business Law Assignmentlg...
|7
|2169
|337
Business and Corporation Law Assignment 2022lg...
|9
|1903
|22