Contract Law and Breach of Contract

This assignment delves into the world of contract law, exploring its fundamental principles and features. It discusses the concept of a valid contract, the consequences of a breach of contract, and the remedies available to parties affected by such breaches. The analysis also examines a real-life scenario involving Juan and Crystal, highlighting the importance of clear communication and acceptance in forming a legally binding contract.

Law

Table of Contents
INTRODUCTION...........................................................................................................................1
MAIN BODY...................................................................................................................................1
CONCLUSION................................................................................................................................6
REFERENCES................................................................................................................................7
.........................................................................................................................................................8

INTRODUCTION
Law is a system which comprises of rules applicable on citizens and can be
enforced in courts. It is called art of justice. Legislations are formed to regulate
individuals or community and their acts so that wrongdoings can be prevented. The
main aim of legal framework is to maintain law and order so that peace and justice can
prevailed (Andrews, N., 2015). Legislative body pass and impose statues which are
compulsory to abide by. In the whole system, contracts govern private individuals
involved in transactions. The report covers a case study which is solved through the
application of contract law followed by an advice on the matter so given in the report.
MAIN BODY
In the given case study, Juan is an owner of super-foods smoothie stand and
buys ingredients from a local organic farmer called Crystal. On Monday morning, Juan
called Crystal which went unanswered thus, he left a message on her answering
machine, offering to buy kale and asking about the week's price per box also mentioned
to give reply as soon as possible.
Crystal faxed a price list to Juan stating kale will be £10 per box and the price is
valid for Monday only. Together with this, she mentioned about the only two boxes that
was left with her and that more kale will be available later on in the same week. Juan
faxed back to Crystal about 2 boxes he wanted to be delivered on Wednesday and
another two on Friday but at same price.
Crystal visited farmer's convention and no fax was received till Tuesday morning.
On Monday afternoon, Crystal was approached by a different trader offering to buy kale
at £20 per box for all kale for next three weeks. Crystal accepted the offer.
On getting back to Juan on Tuesday afternoon, she told about the deal she made
at the convention. By hearing this, Juan was disappointed and felt that he has been
treated unfairly.
The above case signifies the application of contract law to get the answer
whether Juan was actually treated unfairly or not.
Contract is an agreement between at least two parties with mutual consent
enforceable by law (Austen-Baker, 2017). According to Salmond, “a contract is an
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agreement creating and defining obligation between two or more persons by which
rights are acquired by one or more to acts or forbearance on the part of others.” Every
contract is governed by Contract Law, however, there is no individual law in UK for
regulating contract. Hence, Sale and Supply of Goods Act, 1994 is applicable on
contracts executed between parties in UK (Chen, Pei and Furia, 2017). The meaning of
contract can be best understood with the features which have been mentioned as
below:
 Offer and acceptance: In order to form a contract, the offer must be accepted.
The offer must be clear, specific and final which is made to offeree. On accepting
a proposal that was made originally, it becomes an agreement. Further, there
must be consent of both parties to the facts mentioned in the agreement. Also,
the following things must be taken care in regard to offers and acceptance:
(a). If offer has not been accepted, then it can be revoked at any time.
(b). An offer must be differentiated from an invitation so as to make it clear that a
contract is taking place.
(c). The acceptance must be for offer made if not, it will treated as counter offer.
(d). An agreement can be accepted on if has been received by the offeree.
 Lawful consideration: A contract must have a consideration that is legal. It is
defined as something which is expected to get in return for the deal. It can be in
any of these viz. Cash, goods, act or abstinence (Craig, 2015). Further, it must
be valuable and must be there in the contract. Also, it can not be unlawful or past
consideration.
 Certainty and possibility of performance: If a contract is not certain or
specific, then it would be treated as void. In other words, the terms and
conditions in respect of parties, subject, matter and price/payment should be
specific and clear. Also, parties involved in the contract must agree to terms
mentioned in the contract.
 Proving a contract: A contract may required to be proved if it is a part of a case.
It is essential in such situations and written contracts are best to prove as
evidence. On the other hand, oral contracts do not have any existence, thus hard
to prove.
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 Enforceability of a contract: A contract is incomplete without being enforced by
law or in courts. A contract may be unenforceable because of following reasons:
(a). Incapacity of either of the party to enter contract.
(b). Mistakes in the nature of contract.
(c). Illegal or immoral contract (Knapp, Crystal and Prince, 2019).
(d). Contract containing restriction for other party to trade or conduct business.
 Capacity of parties: This feature talks about parties must be legally competent
and be eligible to enter into a contract. Every person entering into a contract
should be:
(a). has attained majority i.e. above the age of 18 years.
(b). of sound mind i.e. absolutely healthy mind.
(c). Not disqualified from entering into a contract.
(d). Willingness to enter
Provided, if a mistakes or defaults have been made by both the parties, the
contract will render void. Also, if a contract has executed unfairly or wrongly, then it will
be considered as voidable. Also, the below-mentioned are some contracts which
necessarily be in writing in order to make them enforceable:
 sale
 lease
 mortgage
 gift
 immovable property
Once a contract has fulfilled the above-mentioned legal formalities, it will be valid
only when prescribed amount of stamp duty has been paid (Lienhoop and Brouwer,
2015). Further, the obligation must be fulfilled to complete it.
There is more to know about contract and its related law and breach of contract
being one of them. When a party fails to meet or fulfil the obligations, it is known as
“breach of contract”. The different occasion on which party has failed to perform within
time provided in the contract, or did not carried actions according to terms and
conditions or denied to perform at all. For example, A enters into a contract with B for
the purchase of goods of a specified quantity and quality. The time for delivery has been
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fixed for next Wednesday. B failed to deliver the products to A on the day specified, due
to which A suffered damages. This is a breach of contract.
There are different types of breach which have been elaborated below:
 Minor breach: In a contract, when one party has completed or met obligations
majorly or the essential obligations but fails to meet a minor term or condition
which does not have impact on contractual terms. It is called a partial breach.
 Material breach: A breach of contract which has serious consequences due to
substantial non-performance of a contract by either of the party (Parpworth,
2018). For instance, a builder has entered into a contract with a client in which he
mentioned clearly about substituting a part of building with different part which is
made of lesser quality which may not have the same longevity as of other parts
in the building.
 Fundamental breach: It is also called as repudiatory breach. In such contract,
termination of a contract seems to be a better option rather than filing a case for
seeking damages. For example, if there was a scene to stop construction of a
building and to abandon it, then party who are innocent will likely to terminate the
contract.
 Anticipatory breach: In this type of a contract, a party shows his unwillingness
or non-performance of a contract. The party expressly mention this.
There are various remedies available for breach of a contract which are as
follows:
Repudiation: It is a remedy available for breach of a contract. A contract may be
terminated through repudiation and compensation can be claimed for loss that the other
party has suffered. Also, in case a warranty in a contract has been breached then only
damages can be sought.
Damages: It refers to an amount which has occurred to other party due to non-
fulfilment of terms and conditions of a contract (Smits, J.M. ed., 2017). If a contract
comprise of a clause stating an amount which will be paid if one party breaks the
contract. It is called “liquidated damages”. These are made part of contracts executed in
manufacturing and building contracts whereby a penalty clause is there for late
completion of work.
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It is of two types which have been mentioned hereunder:
Special damages: It is awarded for losses that can be expressed in quantity.
General damages: When the amount of loss is unquantifiable, general damages
are offered.
Note: There is no concept of “punitive damages” in the UK. Hence, the amount of
compensation is the actual loss incurred by the victim.
In order to sue a party for breach of contract, the party who has suffered must be
able to show the following points:
1. Existence of a contract must be proven to that it is binding legally (Sokol, 2015).
Also, that all contractual obligations have been fulfilled and there is no breach in
the contract.
2. Non-performance of the party must be shown by making a comparison of
completed activities with actual terms which were mentioned in the contract.
3. The loss suffered from the breach of a contract must be proved along with
amount of compensation that the party is seeking.
Note: The party, who has suffered loss must have taken sufficient and reasonable steps
to reduce losses in order to mitigate impact of breach of contract.
Note: There is a maximum period has been provided by UK government for bringing a
law suit against breach of contract and that is six years (Stone and Devenney, 2017).
According to the case, a contract was never executed between Juan and Crystal
because all the conversation happened through fax. Also, a contract is formed when an
offer is accepted and received by the offeree. In this case, Crystal clearly stated that the
offer for Kale box at £10 is valid for Monday only. Also, Crystal couldn't receive it till
Tuesday morning. By decoding the scenario, it can be concluded that two sub-features
of acceptance were not fulfilled which are failure to receive offer on Monday due to
which no offer was accepted by Crystal. Hence, no contract was executed also, it was
lacking the basic features of a valid contract. There was no legal binding also it was not
final.
Juan can not considered it a a breach of contract or that he has been treated
unfairly. In order to file a law suit in the court for the breach, there has to a contract.
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However, the offer accepted by Crystal from other trader will be treated as a valid
contract.
CONCLUSION
From the above report, it can be concluded that law is a set of rules which govern
rights of citizens. Every individual and organizations have to act according within legal
boundaries so as to avoid any consequences which may drag them into the court.
Further, contract law is one of the most important part of whole legal system which is
governed by a specific act. The aim of the act is to provide feature of a valid contract
and protect a party against breach or illegal contracts. Along with this, characteristics,
breach and their remedies have bee described which could provided number of benefits
to a party who has suffered loss or damages.
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REFERENCES
Books & Journals:
Andrews, N., 2015. Contract law. Cambridge University Press.
Austen-Baker, R., 2017. Implied terms in English contract law. Edward Elgar Publishing.
Chen, L., Pei, Y. and Furia, C.A., 2017, October. Contract-based program repair without
the contracts. In 2017 32nd IEEE/ACM International Conference on Automated
Software Engineering (ASE) (pp. 637-647). IEEE.
Craig, P., 2015. UK, EU and global administrative law: Foundations and challenges.
Cambridge University Press.
Knapp, C.L., Crystal, N.M. and Prince, H.G., 2019. Problems in Contract Law: cases
and materials. Wolters Kluwer.
Lienhoop, N. and Brouwer, R., 2015. Agri-environmental policy valuation: Farmers’
contract design preferences for afforestation schemes. Land Use Policy.
42.pp.568-577.
Parpworth, N., 2018. Constitutional and administrative law. Oxford University Press.
Smits, J.M. ed., 2017. Contract law: a comparative introduction. Edward Elgar
Publishing.
Sokol, D.K., 2015. Update on the UK law on consent. Bmj, 350, p.h1481.
Stone, R. and Devenney, J., 2017. The modern law of contract. Routledge.
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