Legal Framework for Valid Contracts: Case Studies

This article discusses the legal framework for valid contracts through case studies of Richard and his father, and Margaret and Emily. It covers the issues, laws, and applications of contract law in Australia. The article explains the elements of a valid contract, the intention of creating legal relations, and the validity of contracts made with minors. It also provides references to relevant cases and legal journals.

Running Head: LEGAL FRAMEWORK
Legal Framework
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Legal Framework
In determining whether there is a contract that binds legally, there are certain
elements that have to be taken into consideration. First, an agreement between two parties
has to exist. Secondly, a consideration that consists of accepting to accomplish something in
exchange for monetary gain, capacity, intention, and certainty. For an agreement to exist,
there must be offer and acceptance. In a situation where one does not honor an agreement
or a contract, he or she can be sued in courts of law, (Chen, 2017).
Case 1: Richard and his father
Issue
The agreement that exists between Richard’s father the millionaire and his Son
Richard falls under domestic contracts. The agreement here was also entered into
harmoniously with the intention of Richard getting money after mowing the compound. His
father also agreed to pay him weekly. Therefore, the issue here is whether a valid contract
exists between Richard and his millionaire father. If it exists, can Richard claim his weekly
salary?
Law
For any kind of agreement to bind legally, all parties involved must show or have the
intention of creating a legal relation. This forms the third and the most important parameter
of valid contracts. However, the law gives a presumption that social agreements or domestic
contracts do not have the intent of binding legally. As such, it is the norm for one to perform
a duty as part of the family or a household. This issue can be presented before a court of law

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so that one can prove beyond reasonable doubt. For this to be done, one has to show that
there were offer and acceptance from both the offer and the offeree. Unfortunately, it
becomes hard to make a reversal in a law that is already presumed. Proving intent, in this
case, will be a hard task on the plaintiff's side (Richard). This can be related to in the case of
Balfour vs Balfour [1919] 2 KB 571 where the plaintiff- wife to the defendant was claiming a
monthly payment of £ 30 after remaining in England while the husband was in Sri Lanka.
Due to the presence of amicable terms, the wife was successful in claiming for payments.
However, in the case of Ermogenous vs Greek Orthodox Community of SA Inc., it was clear
that presumptions in Australia should never be used. This is after the court held that the
intention of creating legal relations was nonexistent by the Full Court of the Supreme Court
of SA. This can also be seen in the case of Jones Vs Padvattan where it was presumed that a
domestic contract between a child and a parent is not intended to bind legally.
Application
From the scenario at hand, Richard accepted to mow the compound belonging to his
father and as a result, he was to be paid $200 by his father. The amount mentioned herein is
to be treated as a form of consideration for the existing contract between the two. In
addition, performing work on a hectare of land needs more time hence its accomplishment
using a half day, every week. It is also essential to note that Richard began the work after his
father’s statement that he would pay him weekly. According to contract law, Richard
performed his part of the contract for four consecutive weeks. His father, on the other
hand, did not meet his part of the contract by refusing to pay Richard claiming that the work
is part of his duty as a family member and as such, he does not d3eserve any form of

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payment. According to the case of Hoeing vs Isaac and Bolton vs Mahadeva, one is entitled
to pay and must not be deprived of his right especially after adhering to the terms of the
contract entered into by all parties, (Roberts, 2017). In this case, the defendants were
ordered by the court to pay the amount agreed in the contract in relation to the substantial
performance.
Conclusion
It is prudent that Richard receives his pay being in the agreement he had with his
father. In case his father does not honor the agreement, Richard has the option of moving to
the courts of law so that his rights can be enforced against his millionaire father, (Lawrence,
2017).
Margret and Emily’s Case
Issues
Emily and Margaret had an oral agreement. However, the agreement was entered
into when Emily was still below 18 years hence being legally termed as a minor, (Mills,
2017). The first issue that arises, in this case, is whether Emily can clearly confirm whether
the agreement she made with Margaret amounts to a contract especially after reaching the
mature age or attaining the majority, (Wakefield, 2017). The second issue is whether
Margaret can be bound by Emily as per the agreement that exists between them.
Law

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A contract made with a minor can be void, valid or even voidable depending on the
option taken by the minor. If a minor enters into a contract where he or she pays for the
benefits accrued from a service, that contract is termed as a valid one. After becoming an
adult, or reaching the majority age, he or she can repudiate the contract hence escaping
liability or reaffirming it, (Bishop, 2017).
Application
The agreement was that Emily receives unsold stocks from Margaret as a payment
for the service provided by Emily. However, when retiring, Margaret decides to give the
stocks that were not sold to charity. In this case, Emily can sue Margaret for failure to honor
a contract they entered into through the agreement herein, (Douglas, 2017). As such, the
agreement is legally enforceable. After attaining a majority age, Emily is the only person
who can make the contract void
Conclusion
In this particular situation, the agreement became legally enforceable in the year
2009 and as such, Emily is empowered and she has every right to the contract because she
is a party to it. For her to get her benefits the best recourse that she can take is presenting
the case to court and suing Margaret in the end. This is most important especially after
offering a service to Margaret, (Chan, 2017).

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References
Bishop, J., & Cassidy, N. (2017). Insights into low wage growth in Australia. RBA Bulletin,
March, 13-20.
Chan, W. (2017). Litigation: Taming the dragon: Enforcing contracts in China. LSJ: Law
Society of NSW Journal, (30), 78.
Chen, V., O'Brien, L., & Ramsay, I. (2017). An Evaluation of Debt Agreements in Australia.
Douglas, M. (2017). Will Australia Accede to the Hague Convention on Choice of Court
Agreements. Macquarie LJ, 17, 148.
Lawrence, S., & Bennett, M. (2017). Image rights in Australia: Fair game or foul
ball?. Taxation in Australia, 51(9), 487.
Mills, A. (2017). The Hague Choice of Court Convention and Cross-Border Commercial
Dispute Resolution in Australia and the Asia-Pacific. Melb. J. Int'l L., 18, 1.
Roberts, M. (2017). Variation contracts in Australia and New Zealand: whither
consideration?. Oxford University Commonwealth Law Journal, 17(2), 238-264.’
Wakefield, J., & Le, C. D. (2017). Contracts: Ensuring legal certainty in international
electronic contracts. LSJ: Law Society of NSW Journal, (35), 86.