Assignment on Commercial Law


Added on  2020-04-13

9 Pages2937 Words46 Views
Running head: COMMERCIAL LAW0Commercial Law

COMMERCIAL LAW1IntroductionA legal contract binds two or more parties to an agreement that is enforceable by law.Contract can be formed between parties who fulfill the essential elements of a contract whichinclude an offer, acceptance, intention, consideration, and capacity. A legal contract does notnecessarily have to be constructed on paper; it can be written or oral. The benefit of writtencontract is that it is easier to prove its validity in the court and the hard copy serves as awritten record of term and condition of the contract. The terms of contract are legally binding upon the parties of the contract, and failureto fulfill such conditions constitutes a breach of contract. A party can file a lawsuit for non-fulfillment of contract’s conditions, and the court can provide remedies by enforcingperformance or ordering defaulting party to pay for damages. Other than a lawsuit, there arealternative dispute resolution methods that can be applied by the parties to resolve theirdispute like meditation, arbitration, negotiation, and others. Question 1I: IssueThe key issue is that whether a legal contract has been formed between Alan andBernard, Damian and Charleen, and if a contract is established then who the contractingparties were. R: RuleAccording to McKendrick (2014), a contract can be defined as an agreement that givesrise to obligations that are recognized and enforced by the law. A valid contract requiresfulfillment of essential elements. Following are the essential elements of a contract:Offer: Professor Treitel defines offer as an expression of willingness to contractbased on specified conditions that are made with an intention to enforce theacceptance of another party legally (Treitel, 2003). An offer can be written, oral orthrough conduct of parties. The person offering the contract is called offeror andperson to whom the offer is made called offeree.

COMMERCIAL LAW2Acceptance: As per Professor Atiyah, acceptance occurs when an offeree giveshis/her approval to the terms of the contract by providing consideration or some othervaluable thing to confirm the contract (Smith & Atiyah, 2006). Consideration: Consideration in a contract is defined as the value that is offered andaccepted by the parties to the contract. Intention: It is necessary that parties to a contract have the intention to bind suchcontract legally, and the consent must be free from any external force (Chen-Wishart,2012). Capacity: The parties entering into a contract must have the capacity to enter into alegal contract that means the parties should not be minor, insolvent and mentallyinsane (Koffman & Macdonald, 2010).A: ApplicationIn this case, Alan posted on Facebook his intentions to sell his book along withhandwritten notes. Bernard responded to such post, but he did not accept the offer, instead, heprovided a counteroffer to buy the book for $150. Alan rejected the offer of Bernard and toldhim that he will only sell his book at $200 and that he already has an offer. Bernard thendecided to accept the original offer of Alan and send him money through the post. Theprinciple of law provides that once a counteroffer is made, the first offer ceases to exit. Thecourt provide in Hyde v Wrench [1840] 49 ER 132 case, if a party rejects an offer for contractand provide a counter offer than the original offer ceases to exist. After the rejection ofcounteroffer, the party did not have the option to accept the original offer (Rahnavard, 2013).Bernard did not have right to accept the original offer of Alan, and his decision to send himmoney through post cannot be constituted as acceptance of the original offer. Therefore,Bernard and Alan did not enter into a valid contract. In case of Charleen, she saw her brother’s Facebook post and told him that she iswilling to buy the book. Charleen was taking her GCE “O” level, and she was still a minor.As per Nash v Inman [1908] 2 KB 1 case, a minor is not able to enter into a legal contract byhimself (Andrews, 2016). Therefore, the contract between Charleen and Alan is not valid. Damian was not the Facebook friend of Alan; instead, he comes to know about Alan’soffer through Bernard. He accepted the term of Alan’s contract and sent him a message toshow his desire. Damian asked Alan whether he can pay on 4th November and Alan give hisacceptance; it created a valid offer between Alan and Damien.

End of preview

Want to access all the pages? Upload your documents or become a member.

Related Documents
Contract Law: Essential Elements, Validity, and Dispute Resolution

The Contract Law of Australia - Assignment

Contract Law Assignment Answers

Commercial Law Issue Assignment

Commercial Law

Understanding Commercial Law: Elements of a Contract and Legal Positions