Contract Law and Vicarious Liability

The assignment delves into the fundamental elements required for a valid contract, including expressed and implied terms. It further examines the concept of vicarious liability, focusing on its application within the context of employer-employee relationships.

Aspects of Contract and
Negligence for Business

Table of Contents
INTRODUCTION...........................................................................................................................3
TASK 1 ...........................................................................................................................................4
1.1Essential elements of valid contract ......................................................................................4
1.2 Explain different types of contract........................................................................................5
1.3 Different types of terms used in the valid contract...............................................................6
TASK 2 ...........................................................................................................................................7
2.1&2.2 Draft contract between Bella UK and Hair for you......................................................7
2.3 Evaluation of effects of different terms used in contract......................................................9
TASK 3 .........................................................................................................................................10
3.1 Contrast contract and tort liability ......................................................................................10
3.2 Explain the nature of liability in negligence.......................................................................11
3.3 Explain how a business can be vicariously liable...............................................................12
TASK 4..........................................................................................................................................13
4.1 Application of elements of tort of negligence.....................................................................13
4.2 Application of elements of vicarious liability in the context of case..................................13
CONCLUSION..............................................................................................................................14
REFERENCES..............................................................................................................................16

INTRODUCTION
Law is a term which is consist of rules and regulations that are created and implemented
through social and governmental institutions for the regulation of behaviour. There are different
types of law that can be contract law, civil law, criminal law, international law etc. In today's
world, the business organizations in whole over the world enters into the contract with other
parties for giving a legal effect to their contractual relationship. A valid contract is an agreement
which is consist of all the essential elements of a contract. It includes offer, acceptance, intention
to create a legal relationship etc (Conrad, 2011). Also, in this present report concept of
contractual liability and tort liability has also been has been defined. Vicarious liability is an
another type of contract in which the employer is held liable for the acts of its employee. In this
present assignment various concepts of terms of law has been discussed with their case laws.
TASK 1
1.1Essential elements of valid contract
In a valid written agreement there are many particulars which make it legal and lawful in
the eyes of law (Cross and Miller, 2011). The companies are required to include these terms in
their contract. There are numerous elements of contract some of them can be demonstrated as :
Elements Definition
OFFER An offer is a term which signifies the offer and
willingness of one person to form a contractual
relationship with another party (Fried, 2015). One
party , offerer makes an offer which has been
accepted by another party so that they can create a
binding contract. An offer is different from an
invitation to offer. A case of Harvey v Facey [1893]
UKPC 1, has been decided in this aspect. In the
given case scenario, Layla offers to purchase a LED
at 125 pounds to Freddy. It will be only considered
as legal contract if Freddy accepts it.
ACCEPTANCE Once a binding acceptance takes place, it forms a

binding contract. Acceptance is given by another
party to the contract to whom offer is provided.
Also, the acceptance must be communicated by an
offeree. The legal agreement must be certain.
INTENTION TO CREATE LEGAL
RELATIONS
To form a valid contract is necessary that there
should be a legal and valid intention behind the
formation of a contractual relationship (Gergen,
2013.). In the given case scenario, there is no
intention to crate an offer as Freddy is not interested
and responded to purchase at an agreed price.
CONSIDERATION Consideration is a value which has been decided by
both the parties in respect of transaction of business.
The consideration must not be related to past.
According to the decided case law : Re
McArdle (1951) Ch 669, it was been held that the
promise related to payment occurred after
consideration so, promise to make payment was not
of binding nature. As, past consideration is invalid.
CAPACITY In creation of a legal contract, the capacity of the
parties to the contract should be considered. They
should not be under age of “18” and of unsound
mind, lunatic and disqualified from law for the time
being in force.
PRIVITY OF CONTRACT This doctrine in law conveys that a contract framed
between both the parties can not confer rights or
impose any sort of liabilities or obligations arising .,
except the parties under it.

1.2 Explain different types of contract
A contract is an agreement which is consist of various legal elements . There are few
types of contract which are as:
 Face to face contract
 Written contract
 Void and valid contract
 Distance selling contract
Face to face contract
Face to face contract is that kind of contract in which two parties are coming together in
front of them to make a valid and proper contract with the agreement of the both parties (Idowu,
Capaldi and Zu, 2013). It is a very simple and straight forward contract in which legal formalities
are not much indispensable because most of the face to face contract are done between families,
relatives, friends or to whom you are very close to them and you can trust easily on them.
Written contract
Written contract are those contract in which paperwork is the most important part
because all the formalities are mostly done on the paper only so that written proof is available
which will shown while ending up the contract. In the written contract all the details of both the
parties are available to avoid fraudulent activities and they can fulfil all the details by signing
that paper which shows that all the above information are true.
Void and valid contract
Void contract is that contract where there is no availability of court and which was
nullified by the court (Latimer, 2012). Simply it means all the contract which was refused by the
law that is called void contract whereas valid contract are signed and accepted by the court of the
law because valid contract consist all the essential terms and condition given by the court.
Distance selling contract
Distance selling contract is a one of the different kind of agreement where seller and
buyer are present to make a contract between them without seeing each other it means this
contract is take place either on the phone call or any other technology used by them to complete
this contract.

1.3 Different types of terms used in the valid contract.
To give a contract a legal effect, it is necessary to consider the various terms used in the
contract by the parties.
Key Terms Definition
Express terms Express terms are those terms in which all the terms are
express either orally or in a writing so that both the parties
get aware about the essential terms and condition to come
in any contract.
Implied terms Implied terms are the most indispensable part of any
contract because implied terms are made by court which
was mention in every documents while making deals as it
is said that implied terms are mandatory (McInnes, Kerr
and VanDuzer, 2013).
Innominate terms These are those terms which are firstly not included by the
parties to the contract but at the the time of issues court
introduces this term to clear to ambiguity.
Conditions Condition means that a contract which take place between
certain conditions and it is compulsory to follow that
conditions because that was important thing on which the
contract was based. In case law of Poussard v
Spiers (1876) 1 QBD 410, both the parties have laid down
their own terms and conditions.
Warranties Warranties is a word in context of contract describes as if
any contract does not take place in a warranty period then
the other party must sue the opposite party to not fulfilling
the contract in warranty period.
Exclusion clauses An exclusion clause is the other name of limitation it
means the clauses which was excluded or it can control the
other party and these clauses are very precise and clearly
shown on the contract.

TASK 2
2.1&2.2 Draft contract between Bella UK and Hair for you
Purchase Agreement
Party 1: Bella UK
Party 2: Hair for you
Based on the follow position:
Party 1 will agreed to sell 10 boxes of shampoo for the price of 5 boxes to Hair for
you company. The company has introduced a shampoo namely ' Miracle Oil' that
claims rapid growth of hair and also has advertised through flyers. The company has
expressly state that the offer will be continue for limited period.
Party 2 will agreed to purchase 10 boxes as advertised by Bella UK just for the price
of 5 boxes. The said company has agreed all the terms and conditions as conferred by
Bella UK.
(Implied terms)
In this agreement, it has been implied that the offer is for limited period and also it
implies that risk has been transferred along with the product by Party 1 to Party 2 , as
seller accepts no guarantee for adverse results.
(Exclusion clause)

From this agreement, the party 1 has excluded it self from the liability that will occur
or to be occurred in respect of shampoo. Party1 has clearly mentioned in their
advertisement that seller accepts no responsibility for any adverse results also the
product has 20% success. This indicate that the party 1 has no responsibility in case
of any damage or injury.
Second party: Hair for you………………………….05th April,2017……………….…
………………
Full name Signature Date
First party : Bella UK………………………..….. 05th April,2017 ……………….…
……………
Full name Signature Date
2.3 Evaluation of effects of different terms used in contract.
In a written agreement, it has been defined that both the parties include their own terms
and conditions at the time of framing the contract (Meiners, Ringleb and Edwards, 2014). It
helps to underpin several issues and conflicts. The different terms that can be used are as : breach
of contract and legality of exemption clause.
Report to Mr Michael Hair
To Mr Michael Hair
RE: Report on key terms
 Breach of contract : It is the concept which signifies that it is a lawful cause of
action which includes a biding agreement or bargained for exchange is not
complied by any of the party to the contract. It also includes the non
performance of any of the condition implied at the time of creation of contract. It
means that one party is liable to damages in case of breach of contract to another

party.
 Legality of the exemption clause: Exemption clause is a legal concept in which
one party to the contract exempts itself from any kind of liabilities and da,mages
that can be occurred in the context of business transaction. It is legal until and
unless it does not cause any harm to other party.
In the given scenario, “Bella UK” has advertised its newly introduced product that is
“Miracle Oil” shampoo. Company claims that it results in rapid hair growth. For attraction, the
company has declared that 10 boxes will be provided at the price of 5. The company has also
excluded it self from any case of liability or any adverse results. In this case the Bella UK, has
implied the exclusion clause in their agreement that they will not be responsible for any
inauspicious results. It is valid until and unless it does not cause harm to other party that is
“Hair For You” . On the other hand, the breach of contract between both parties will happen
only if any of the party dishonour the conditions or terms expressly mentioned in contract.
Sincerely
TASK 3
3.1 Contrast contract and tort liability
 Contract liability
Contract liability is that liability in which one party is liable by other party while doing a
contract with each other that is called contract liability (Miller and Cross, 2012). While
elaborating this term contact liability it shows that all the matters related to liability are comes

under this like a person is liable while performing any job in any business and if liable person
was not able to fulfil all the terms then may be party should face any damage. In a Contract
liability a party are comes under certain rules and regulation which is mandatory for them and it
must be follow by them because they are bind towards that task
 Tort liability
Tort is a word which means anything happens in a wrongful way must consider under tort
liability or may be a person should pay for that wrong thing whatever was done by that
party(Pathak, 2013). Simply tort liability is the term describes the violation of rules and
regulation by doing any unfruitful task which resulted in a punishment. According to the decided
case law : Barnett v Chelsea & Kensington Hospital [1969] 1 QB 428, it was been held that the
hospital is not liable for damages as the doctor's failure to check his patient did nit result in the
death of that patient. So, doctor is not liable to pay the damages.
SIMILARITES DIFFERENCES
The similarities between these two terms
are that in both terms result in liability to
pay the damages in breach of contract and
its conditions (Miller, 2015).
Terms and conditions in contract liability
are made by the parties only who are taking
part in the contract where as in tort liability
rules and regulations are made by law
themselves (Sweet and Schneier, 2012).
Contract liability is not that much strict
whereas tort liability is more strict.
3.2 Explain the nature of liability in negligence.
Tort is the civil law which deals with civil wrong. Negligence of duty is the term which
implies that there is a breach of a duty on the part of defendant but with out an intention
(Trompenaars and Hampden-Turner, 2011). Defendant causes harm to the injured party due to its
negligence or carelessness. In this aspect, the defendant is held liable in the eyes of law to pay
for the damages to plaintiff. In order to claim da,ages by litigant, the claimant should prove :
 That the defendant must owed a duty of care.

 That defendant has breached that duty of care.
 The damage has been caused by litigant.
According to the landmark case of Donoghue v Stevenson [1932] AC 562, Mrs
Donoghue went to cafe with her friend. Her friend bought him a bottle of ginger beer. As, ginger
bottle was in opaque bottle so its content can not be seen. Then Mrs Donoghue poured some of
the contents in he ice cream and then found a snail in it. As a result of it, Mrs Donoghue suffered
from personal damages. She sued the manufacturer of beer in the context of negligence as she
suffered injuries. In this respect, it was held that her claim was successful. The manufacturer
was held liable for the damages and compensation. In other words it has been said that
defendant has breached its duty of care and hence liable to damages.
3.3 Explain how a business can be vicariously liable.
Vicarious liability is the term in which one person to the contract is held liable for the
acts done on the behalf of other party to the contract . It means that the business is held liable for
all the acts done by its employee and also responsible for the damages. It must be noted that
vicarious liability occurs where there is a contractual relationship between the parties to the
contract (Zamore, 2016). Vicarious liability is that doctrine which imposes the strict liability on
employers due to wrong things committed by its employees. Generally an employer will be held
liable for the acts done by its employees while performing their dutie4s assigned.
In the given case scenario, it has been shown that Bob was a local milk man hired by
Norkfolk farms. He had occupied a 13 year old child namely Matt as his assistant and asked him
to keep this thing between them only. Further more, Matt met a accident while delivery of milk.
In this case, Matt can sue Bob only through his guardian. As Matt is a minor, he can not
sue Bob on its own name. According to the case law of BYERS WATTS v. PARKER, Michelle
Byers Watts on behalf of herself and as a guardian of Michelle Miller Watts had filed a suit on
Toni. L Parker. A minor can only sue the defendant through his guardian.
Also, the Norkflok firms are held liable for the acts done by his employee Bob. Due the
provision of Vicarious liability employer will be held liable for the acts done by employee.

TASK 4
4.1 Application of elements of tort of negligence.
Tort is the civil wrong done by any party of other party. Negligence of duty is the part of
Tort law in which one party breaches contract and conditions due to negligence (Wong and
Deubert, 2010). In this case,Albert who wishes to purchase a flat has agreed to buy a flat from
Brad. Brad authorised its accountant Charles to verify about Albert. Due to negligence, Charles
misinterprets and conveyed that Albert is sound man, but he was not.
To,
Brad,
Re: Recovery of losses.
Brad can recover its loss from Charles. Due to the concept of negligence of duty, Charles
has breached the duty of care and he is liable to pay the damages to Brad as he was expected a
duty to care from him. According to the concept of negligence, a defendant is held liable for
breaching of contract and plaintiff can claim damages from him.
4.2 Application of elements of vicarious liability in the context of case.
Vicarious liability is the strict liability that has been conferred on one person for the
actions performed by other. It means that an employer will be held liable and responsible for the
deeds done by its employees (Ashcroft, Ashcroft and Patterson, 2016). It must be noted that that
elements of vicarious liability only occurs
in the case of relationship of employer and employee during course of employment.
a)In the given case scenario, Graham a door man is authorised by Macho men plc,a
company which owns pubs and bars, to eject any misbehaved person. When he ejects a drunken
customers, he broke his hand. In this case the cited company is held liable for the acts of its
employee namely Graham. According to the said concept of Vicarious liability , employer will
be accountable for the acts done by its employee. Also, if Graham has expressly prohibited to
deal with trouble some customers then , the Macho men plc company will be liable to the acts of
Graham as there is a contractual relationship between them.

b) In this case, Carla is an employee of the company namely Links LTD. Who is engaged
in the business of courier delivery. She used to take office van for delivery. She injured the car
when she was on her duty to deliver the courier. In this case, the company will be held liable for
the acts of Carla as she was on her duty and performing the tasks assigned to her in respect of the
concept of vicarious liability.
CONCLUSION
From this above report it has been assessed that there are many essential elements of a
valid contract. Valid contract is a legal agreement in a written for. Also various terms like
implied terms , express terms has been discussed. Also the concept of vicarious liability has been
mentioned in the context of employer and employee relationship.
REFERENCES
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