Law of Business Association2 Q1. Issue: A contract describes a legal document which binds two or more parties to one another. It needs one or both parties to meet the obligation ahead of its completion. Termination of a contract can take place thus making it void of any legal binding. Strictly parties engaged in such an agreement might trigger its termination. The issuesarethus, could Michele be breaching the contract after signing it under the Section 121(1) and 121 (2) of the Corporation Act 2001 (Cth)?1 Law:Acontractcanbeterminatedduetolackofconsideration;performance impossibility, contract breach, initial agreement,contractrescission,contractcompletion, the statuteof fraud, mutual mistake and misrepresentation.A contract must be legally binding and enforceable by law to and be an agreement made between two or additional parties. In this case, the termination of the contract seems to be caused by breach of a contract. Therefore, there is a dispute between John and Motorbikes Pty Ltd. It is true thata contract has been signed by the three parties. However, one party, Michelle is breaching the contract based on aclaimof too much payment for the motorbike.Thus, there is a dispute between the company and John. Thu the focus is to check whether the four elements of acontractare present to make this contract a binding one. Application: In this case, there is a dispute,andthe parties are arguing whether the contract orfundamental part of the contract, have been breached. The contract is between John and the company alongside Michelle, a contract’s party wants to end it. She Motorbikes Pty Ltd.’s owner alongside Tim and director remains bound to contract and hence the firm.Being 1Corporation Act 2001
Law of Business Association3 that they Tim and Michele signed that contract at the time they purchased motorbike of John impliestheir firm is bound by it. If they want to end contact, it is a requirementforthem to agree totermination.Thecontracttermination’srightsemergein3occasions:agreement’s renunciation or repudiation by a party; reasonably severe non-essential term breach; and a crucial term’s violation. Here, if right to terminate surfaces, John shalldecideon to either confirm the contractand then proceed to claiming breach damages or he could enditand then claim complete loss of bargain damages. The company further needs to defend termination based on having a lawful right to perform this as well as if they stood knowledgeable or not during contract signing.As observed in Frumar vs. Guilfoyle Developments Pty Ltd.(2014) NSWCA 225.2A significant element in the definitionof ifparties to a contract to have anintentionof immediately bound by the change to thecontractisexistenceof essential by either party to a rapid agreement to other change as observed in Crown vs. Clarke (1927) 40 CLR 227.3The challenge in demonstrating oral contractis further demonstratedhere. To sum up, Michelle, one of the owners of the firm already signed a contract. The signing implied she had consented to contract terms. For her to later wish to withdraw from the contract still leaves the company bound by a contract. Thus, Motorbikes Pty Ltd. remains bound by the contract. Q2. Issue: Here, George remains the Cake shop’s owner where Sylvia and Gerard want to purchase. The company has been registered by them as “Cakes Pty Ltd”. Stamping of the seal is, however, done for the company during contract signing implying that George has entered a 2Frumar vs. Guilfoyle Developments Pty Ltd. (2014) NSWCA 225. 3Crown vs. Clarke (1927) 40 CLR 227
Law of Business Association4 contract with Cakes Pty Ltd. Gerard and Sylvia are only witnesses to contractto sign. Here, the issuesarethat George needs the shop back, yet he already had signed acontractof selling thiss shop. Here, is Gerard breaching the contract as reflected in Crown vs. Clarke (1927) 40 CLR 227?4 Law: A contact merely is an agreement to do/notdosomething. The contract needs to be enforceable and legally binding to be valid. The agreement must be highlighted to bar disputes. Here, George already signed acontractto sell the shop needs it back since he thinks he engaged in a bad idea to sell it. Gerard now wishes to terminate the contract. For him tobe boundby this contract, George must have thelegalabilityto formacontract orcapacity to contract. Further, improper persuasion, threats, coercion, and thefalsestatement must never have been utilized to force him to sign acontractas highlighted in Balfour vs. Balfour [1919] 2 KB 571.5Both parties, Cakes Pty Ltd. andGeorge,must have engaged in mistake. Further, George must never have assumedthe risk or error contractually. It is imperative to that an individual who signs a given contract is presumed to comprehend it is bound to contract’s terms. Application: Once he has signed a contract, George remains bound by it. Signing the contract implied that George was aware intensely of terms of agreement. Further, no evidence showing that improper persuasion, threats, false statement, coercion were employed by either Sylvia or Gerard to compel George to signit. Further, no evidence telling us that a mistake existed in fundamental assumption upon which contractis anchoredfor it tobe terminated. 4Crown vs. Clarke (1927) 40 CLR 227? 5Balfour v Balfour [1919] 2 KB 571
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Law of Business Association5 Hence, George remains presumed to have fathomed thecontractand stays bound by thecontract. As observed in “ABN Amro Bank NV vs. Bathurst Regional Council (2014) FCAFC 65”.6The former promised to a financial product with some characteristics for “Local Government Financial Services Pty Ltd”. It was considered by Federal Court whether the terms must have been implicitby S.12ED of ASIC Act 2001 (Cth) (ASIC ACT) that needed ABN Amro to come up with a note with a degree of security corresponding an “AAA’ rating as seen in “Beaton vs. McDevitt (1987) 13 NSWLR 162”.7 To sum up,byGeorge’s agreement to sell the shop on his free will and going further to sign acontract, George remains legally bound by thecontract. By signing acontract, George showcases he had read and comprehended contract terms. References Balfour v Balfour [1919] 2 KB 571 6ABN Amro Bank NV vs. Bathurst Regional Council (2014) FCAFC 65. 7Beaton v McDivitt (1987) 13 NSWLR 162
Law of Business Association6 Beaton v McDivitt (1987) 13 NSWLR 162 Corporation Act 2001 Crown v Clarke (1927) 40 CLR 227