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CONTRACT LAW1NameCourseProfessor’s NameUniversityDate
CONTRACT LAW2Contract law or rules are the conventional rules governing the validity, content, and therelationship of an agreement between two or more companies, institution or individuals. In mostcases in the areas of provision of services, the sale of goods or the exchange of ownership orinterests AGC (Advances) Ltd v McWhirter (1977) 1 BLR 9454. It is the law that governs whathappens when the contract breaks down and establishes the terms of an agreement in the event ofa dispute. For this paper, two questions are to be addressed. Besides, the paper seeks to use theIRAC method (Issue, Rule, Application, and Conclusion) in answering the two question.QUESTION 1.Is Motorbikes Pty Ltd bound by the contract? Provide reasons for your answer. Youmust cite relevant Australian case law and the Corporations Act 2001 (Cth)IssueIn this instance of Motorbikes Pty Ltd and John, it is clear that there is a problem with thecontract involving the parties. John who is the owner of the motorbike approaches Tim who isthe secretary of the company which they own with Michelle. Tim agreed to pay $ 5000 for themotorbike, and after the agreement, he and Michelle sign the contract to purchase the motorbike.Later Michelle who had signed the contract want to get out of the contract thinking that they hadpaid much for the motorbike. Therefore from the above case could Michelle be breaching thecontract (Corporations Act 2001 (Cth)?LawAs defined in the introduction, a contract is said to be an agreement between two or moreparties which is legally enforceable. In our case, we have the parties as Michelle and Tim whoare the Motorbike Pty Ltd owners and John, the motorbike owner. Also, both sides assume a
CONTRACT LAW3legal obligation which they must complete. When one party to the contract fails to perform thelegal obligation it has agreed to, legal issues involving contracts arise. In cases where a partybreaches a contract, the other party can sue on the basis of money damage or may plead with thecourt to request the other party to honor the promise. When the contracts are not written clearly,they become a source of legal disputes (AGC (Advances) Ltd v McWhirter (1977) 1 BLR 9454).Various terms are frequently used when solving issued related to Contract law.They include:Contract. According to the Australian Contact Law, it is termedas an agreement between two or more parties that builds in each party obligation to dosomething or not do it, and the right to performance of the other party’s obligation or a solutionin case a breach arises (Scammell v Ousten  AC 251).Offer. A proposal for a contract that another party may agree upon the recipient to form acontract which is legally binding.Acceptance. An approval of an offer of a contract which is legally binding. It is required to bewritten.Breach. Breach of contract is the act of not performing a duty or obligation created by contractor a promise without justification.The statute of frauds. A law of a state that prohibits enforcement of certain contracts unlessthey are in writing.Performance.The action or omission needed to fulfill a promise or duty.