Case Study Issues 2022

Running Head: CASE STUDY
CASE STUDY
Name of the Student
Name of the University
Authors Note

CASE STUDY1
Scenario 1:
Issue:
The issue in the case is whether a valid contract has been formed between Tom and Jerry.
Rules:
As a general rule, the realm of law and legal relationships are separated from that of the
family. In other words, the contractual relationship established by the virtue of contractual rights
and duties of the parties is not recognized in case of family agreements (Meritt vs. Meritt). This
is so because the intention to create contracts cannot be established in family agreements on the
ground of lack of lawful purpose among the family. However, in commercial contracts, the
legitimacy of the purpose and consideration forms the intention between the parties to enter into
the contract with each other (Popwi vs. Popwi). However, the Court has recognized the
agreements between the family members as enforceable depending upon the contractual
intention created between them by the virtue of legitimacy of purpose and consideration and the
proof of elements for contract exists between the parties (Ermogenous vs. Greek Orthodox
Community of SA Inc).
Application:
In the given scenario, Jerry had asked Tom to buy him out in case he wanted the
company to continue. It can be explained that since they are brothers, the contract for partnership
would not be enforceable by law. However, by the virtue of the legitimacy of their purpose and
consideration involved between them, it can be explained that Tom and Jerry, in spite being
brothers, were involved in the contractual relationship with legal intention, purpose and

CASE STUDY2
consideration which forms the basis of commercial contract which can be proved by Jerry’s
comment where he has demanded for consideration against his shares for the legitimate purpose
to buy him out. Hence, Tom and Jerry were bound by the contractual relationship that existed
between them.
Conclusion:
It can be concluded that valid contract was properly formed between Tom and Jerry.
Scenario 2:
Issue:
The issue in the case is whether Star Shipping are liable to pay for the destroyed laptops.
Rule:
Express terms: these are the explicit terms in the contract that binds the parties however,
such term shall be lawful in nature.
Non-Est Factum: it means that the contract shall become void ab initio if the contract was
signed by mistake by the plaintiff. This means that the mistake on the part of the plaintiff to
understand the fundamentals of the contract and the same has been signed by him or her shall
render the contract as void ab initio. This means that the contract signing should be a
fundamental mistake and the signing has altered then intention of the party. However, the
carelessness or mistake or negligence in reading the contract and its terms shall not be assumed
as non-est factum and hence, such mistake shall not void the contract.