Essential Elements of Contract Law Assignment

Aspects of Contract

Table of Contents
INTRODUCTION ..........................................................................................................................1
TASK 1............................................................................................................................................1
1.1 Explaining the importance of essential elements of contracts which are required to form a
valid contract...............................................................................................................................1
1.2 Impact of various types of contracts.....................................................................................2
1.3 Analyzing the terms of the contracts.....................................................................................3
TASK 2............................................................................................................................................4
3.1 Contrast liability in tort with contractual liability................................................................4
3.2 Nature of liability in negligence and employer's liability.....................................................4
3.3 Vicarious liability..................................................................................................................5
4.1 and 4.2. Application of the elements of tort of negligence, defenses and vicarious
liabilities in the given business situation....................................................................................5
2.1 Impact of different types of contract.....................................................................................6
2.2 Application of the elements of the contract .........................................................................6
2.3 Evaluating the effect of different terms................................................................................7
CONCLUSION................................................................................................................................7
REFERENCES................................................................................................................................9
Books and Journals.....................................................................................................................9
Online........................................................................................................................................10

INTRODUCTION
Contract can be defined as a voluntarily and legal relationship between two or more
parties. It binds contracting parties in legal relations through the written form of the contract as
well as provides rights and responsibilities to each party in against of another. To convert
agreement into a contract it must have the four essential ingredients of the valid contract such as
offer, acceptance, legal consequences and consideration (Flodgren and Runesson, 2015). The
present depicts essential elements of the contract without which on cannot make valid contract. It
also represents the impact and effect of different type of contract upon the business aspects or
activities. Besides this, it states nature of liability in negligence and application of tort of
negligence in different business situations.
TASK 1
1.1 Explaining the importance of essential elements of contracts which are required to form a
valid contract
In order to form valid contract parties of the contract must fulfill the essential needs of
the contract. Offer and acceptance, lawful consideration, capacities of the parties, free consent,
lawful object, certainty and possibility of performance are the main elements of the valid
contract (Srinivasan, 2014).
For example: Peter is the bookseller and Ronald is the customer who wants to purchase the
books which is shown to Ronald by the bookseller. Peter is 24 years old and Ronald is in the age
of 19. Peter offers the books to Ronald with the intention to sell it @ 24£. Once Peter has
displayed the book to Ronald thereafter, he gives his acceptance to purchase the book @ 24£.
In the above case contracting parties possess all the attributes of the valid contract. The
agreement which is enforceable by law is known as legal contract. Essential elements which are
required to form a valid contract are as follows:
 Offer and Acceptance: In order to make legal bindings there must be lawful offer and
lawful acceptance is required between the two competent parties. The word lawful states
that contract must required to satisfy the legal requirements which are mention in the
contract in relation with thereto (Faure, 2009). In the above example Peter offeror and
Ronald is the offeree. As stated in the example that Perter legally offers the book to
1

Ronald and he give legal acceptance in relation to the purchasing of book. As per the
contract act 1857 there is the legal offer and acceptance between the Peter and Ronald.
 Intention to create the contract: As per the example it has been analyzed that there is an
intention among the parties to the contract. As per the contract act there must be legal
relationship and obligation between Perter and Ronald.
 Lawful consideration: On the basis of above cited example it has been assessed that Peter
sells its book to Ronald @25£. Peter does not sell it books in king so there by he fulfills
the condition of valid contract. In contrary to this, in return of amount Peter give book to
Ronald which shows that both the have lawful considerations.
 Capacities of the parties: To make a contract a contracting parties must be major, with
sound mind and cannot be disqualification by any law. Above cites case states that Peter
and Ronald both the parties possess capacity to make a valid contract.
 Free consent: In the above mentioned example it can be seen that both the parties to the
contract are agree to build a legal relationship without any coercion, fraud,
misrepresentation, undue influence or mistake.
 Lawful object: In order to make a valid contract there must be a lawful object between the
parties which are going to make contract.
 In addition to this, parties require to make written contract because oral contract has no
evidence to prove it as a legal contract.
As per the cited example it has identified that Peter and Ronald meet all the requirements
of the valid contract and it is enforceable by law (Ten Essential elements of a valid contract.
2015).
1.2 Impact of various types of contracts
Impact of various types of contracts is as follows:
 Unilateral and bilateral contract: On the one hand, in unilateral form of contract one
party make promise to another without taking consent of another party. It is also known
as one sided contract in which party who make promise is known as offeror and another
party to whom promise is made are known as offeree. In the unilateral contract offeror is
obliged to fulfill the promise which he made but offeree cannot be enforced by law to act
(Botha, J. C., 2005). On the other hand, in bilateral contract exchange of mutual
promises have been done between the parties. In this, parties of the contract are obliged
2