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Business Law and Ethics Program

   

Added on  2021-06-17

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INTRODUCTION TO BUSINESS LAW& ETHICSCONTRACT LAWStudent Name[Pick the date]
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Question 1 Issue The issue is to comment on whether Fran and Marco have enacted an enforceable contract or not.Relevant Law The contract would be enforceable only when the below highlighted essentials are fulfilled. Presence of valid agreement (lawful offer and acceptance)Presence of mutual consideration Capacity of the parties and intention of the parties to enter into contractual relationshipWhen the contractual parties are connected through domestic relations, then the imperativeaspect that the honourable court would take a note of is intention of the parties to enter intocontractual relation. In pre-contractual phase, if the parties do not represent the intention tocreate legal relations, then no enforceable contract would form between the parties in these cases.The verdict announced in Jones v Padavatton1 case is the testimony of this aspect. According tothis case, there was an promise on part of the defendant that if the plantiff would fulfil a promise,then reward would be given which was later broken. The court held that the promise was non-enforceable due to lack of intention of parties to legally enforce promise.2ApplicationIt can be seen from the given case facts, that Fran and Marco are connected with domesticrelation (brothers). Hence, the major aspect is to determine whether the parties have intention toenter into legal relationship or not. Based on the case facts, it can be seen that both the partieshave mutually accepted the terms and conditions of agreement and have drafted the employmentagreement with the help of a lawyer. Further, they have signed the legal employment agreementin the presence of witness. Therefore it can be concluded that enactment of contract by using therequisite legal measures such as witness, service of lawyer is the indication of the intention ofFran and Marco to enact legally enforceable contract. Hence, the contract is enforceable on theparties and both the parties have to complete the respective contractual liabilities. 1Jones v Padavatton[1969] 1 WLR 3282Michael Lambiris, Griffin Laura, First Principles of Business Law (Oxford University Press., 10th ed, 2017) 1
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If Fran does not fulfil the contractual duties, then Marco has the legal right to sue Fran and claimfor the damages. Conclusion Fran and Marco both have clear intention to make legal relation and therefore, legallyenforceable contract is present between the parties. Hence, Fran cannot hire Jane in place ofMarco because Fran is bounded with contractual obligation.Question 2 Issue The central issue is to comment whether there is an application of doctrine of promissoryestoppel based on the given circumstances. Relevant Law The doctrine of promissory estoppel would be applicable only when the second party who hasinitiated or worked based on the promise made by the first party. It means, when the offeror hasstated a promise to offeree and the offeree by relying on the promise has enacted some work andlater on the offeror has denied to complete the promise, then in such cases doctrine of promissoryestoppel would be applicable. In this case, the parties would said to be in legal relation and has tocomplete the contractual relations3. The following aspects must be present for the validation of doctrine of promissory estoppel4. Offeror (A) party has made an unambiguous promise or representation to offeree (B). Offeree (B) has initiated some work based on the representation of the offeror. However, if offeror has denied completing the promise, then the offeree would suffersignificant losses. Also, it is essential that offeror does not inform the offeree regarding the possibility thathe/she may not complete the promise. 3Andy Gibson, Douglas Fraser,Business Law(Pearson Publications., 8the, 2014)4Shayne Davenport,Business and Law in Australia(Thomson Reuters, 4thed, 2012)2
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