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Contract between Rahul and Saurav for the purpose of buying the plane

   

Added on  2020-03-01

6 Pages1226 Words346 Views
Running Head: Law 1Law

Law2Answer 1Issue:Whether there is any contract between Rahul and Saurav for the purpose of buying the plane? Law:For a valid contract, there must be an agreement between the parties which includes offer, acceptance, and intention to create legal relation. Generally, it also includes meeting of the mindsbetween two or more parties. Offer- Offer is considered as a communication between two or more parties for the purpose ofdoing or not doing something if other person to whom the offer is directed do or not do something or makes any promise in return (ACL, n.d.). Acceptance- Acceptance is considered as unequivocal statement given by offeree for agreeingthe offer. It must be noted that there is no particular form of acceptance. This can be understood through case law Empirnall Holdings Pty Ltd v Machon Paull Partners Pty Ltd (1988) 14 NSWLR 527. In this case, Court stated that conduct of the offeree can be determined for considering the acceptance. Consideration- Consideration is considered as price quoted by the promisor for the promise. For this purpose price is considered in broad sense, which means it is not necessary that price must be of monetary nature or even it has any monetary value (ACL, n.d.). Intention- for the purpose of contract to exist it is necessary that parties must intend to create legal relations. Generally, presence of consideration is considered as evidence that parties intend to create legal relations. In case promisor quoted price for the promise, then in number of cases it

Law3is assumed that there is intention to create legal relations. For the purpose of determining contractual intention, Court adopts objective approach. This can be understood through case law Air Great Lakes Pty Ltd v KS Easter (Holdings) Pty Ltd. In this case, Court stated that contract was the consequence imposed by law and through contract Court determines the words and actions of parties. Court further stated that actual subjective intention related to the contract was that factor which was considered by Court for the purpose of determining the existence the contract (ACL, n.d.). Application:In the present case, all essential elements of the contract are present such as offer, acceptance, consideration, and intention. Words and conduct of Saurav clearly shows that he has intention to create legal relations because he prevent the Rahul from selling the Plane to anyone else and promise to pay consideration in 10 days. Therefore, there is contract between Rahul and Saurav. Conclusion:Rahul can rely on the contract because there is clear intention to create legal relations.

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