Aspects Contract Negligence in Business Assignment

Added on - 03 Dec 2019

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ASPECTS OF CONTRACTS
TABLE OF CONTENTSINTRODUCTION...........................................................................................................................1TASK 1............................................................................................................................................11.1 Essential elements in formation of a valid contract..........................................................11.2 Type of contract................................................................................................................21.3 Different terms of contract...............................................................................................3TASK 2............................................................................................................................................42.1 & 2.2 Drafting a simple contract act for purchase of product that is being advertised byBella UK.................................................................................................................................42.3 Writing report to Mr. Michael Hair, owner of “Hair UK”...............................................4TASK 3............................................................................................................................................53.1 Differences between Contract and Tort liability..............................................................53.2 Development of concept of “Duty of care” and neighbour Principle..............................63.3 Way in which business is held vicariously liable.............................................................7TASK 4............................................................................................................................................84.1 Draft of short letter to Brad..............................................................................................84.2 Solutions to following case study.....................................................................................8CONCLUSION................................................................................................................................8REFERENCES..............................................................................................................................10
8INTRODUCTIONThe aim of this research report is to recognize the aspect of contract and negligence in abusiness. This report identifies essential elements of Contract Act in different business situations.The report has drawn key attention on different elements that are essential for the formation of avalid contract act. Furthermore, tort law has highlighted the principles and nature of liability innegligence. The report has assisted in drawing sharp contrast between tort and contractualliability. It has also discussed in brief the concepts of “duty of care” and neighbor principle inreference to Donoghue v Stevenson case study. Lastly, report has applied varied elements ofvicarious liability in respective business situations.TASK 11.1 Essential elements in formation of a valid contractFor formation of a valid contract, it is important to briefly discuss the different essentialelements which are required to be fulfilled by contracting parties. The following elements are-1.Offer and Acceptance- An offer is an expression of willingness to enter into a contracton specified terms made with an intention which is binding once affirmed i.e., acceptedby the person to whom it is being addressed (Ward, 2010). Offer may be in expressed orby conduct. An unqualified and final expression of assent to the terms of offer isacceptance. An offer is deemed accepted in reference to the precise terms if it is to formas an agreement. Acceptance has no legal status until it has been communicated to theofferor.In addition to this, unilateral and bilateral are two type of offers. When firm giveoffer to the public then it will be counted among the unilateral offer. On the other hand,as per the case of(Harvey v Facey[1893] AC 552) party will have toperform its duty and responsibility if it receive offer from the other party.In the following case, James has invitation to offer on e-commerce website for sale of ahigh definition web camera for £55. Maria has given its accent to the offer via e-mail with theterms that she was willing to buy camera for £45. The counter offer has invalidated the contractas James at first instance refused to accept this counter offer. Once both parties agree on a fairprice, the offer will stand its existence.2.Intent to create a legal relation- An agreement is not binding until it has been madewith a legal intention (Steele, 2010). Parties are required to enter into an agreement to
8become legal bound by it. In an ordinary transaction, it is presumed that parties haveintent to create legal relations(Jones v Padavatton[1969] 1 WLR 328).In this case, James has an intention to sell the product at £55 to which Maria has shownwillingness to buy the product at £45. Maria showed intent to enter into a contract to whichJames had refused. Thus, it can be said that the contract has not been entered with intent to createlegal relation.3.Consideration- In a general contract law, a promise in not binding unless it has beensupported by any consideration. As perThomas v Thomas) (1842) 2 QB 85 caseconsideration is referred as “something in value” and is required to make the promiseenforceable as a contract (Owen, Taylor and Francis, 2000). Thus, it can be said that apromise has no contractual existence until some value has been inserted in it.Consideration specified need not be adequate.In this case, consideration can be seen in the form of price money quoted by both Jamesand Maria.4.Capacity- Contract entered by minor will be termed as void. Thus, to conclude a contractto be valid, it is important that both the parties must be major (Individual above 18 years).In this case study, it can be assumed that both James and Maria have turned t be major toenter into this contract.5.Privity of Contract- This is a common law of doctrine where the third party holds noright to take any actions, if parties entering into contract have failed to fulfill theirspecific condition of agreement (Campbell, 2007). For example, a contract has beenentered between A and B whereby, A agrees to pay a specific amount to B. B has furtherentered into a contract with C to pass him the amount so received from A. Thus, if A failsto deliver the specific amount to B, C at that time possess no right to sue A for non-delivery of money.In this case, there is no third party’s right to enforce Maria to pay the amount to James.1.2 Type of contractThere are varied types of contracts that have been recognized by the parties that areformed for the purpose to enter into a legal contract.1.Face to face contract- In this type of contract, all conditions of agreement is determinedby verbal communication. The parties entering into contract are physically present at the
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