Aspects of Contract and Negligence Report
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Added on 2020-01-07
Aspects of Contract and Negligence Report
Added on 2020-01-07
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ASPECTS OF CONTRACT ANDNEGLIGENCE
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INTRODUCTIONContracts and agreements are the crucial elements of any business organization. Thesecan be formed orally or in written form (Butler, 2014). Written contract involves roles andresponsibilities of both the parties written in a legal document. It reduces the chances of breachof contract. Contract is a tool that safeguards the resources of both the parties. In the givenreport, Peter Abraham wants to carry his own business as a building contractor (O’Leary-Kellyand et.al., 2014). Before starting the business, he wants to know about various legal formalitiesthat are needed to be done. This report includes essential elements of a valid contract and thereapplication as well as principles of liability in negligence in business activities . Report alsoemphasizes on similarities and dissimilarities of liability of tort with the contractual liability andelements of vicarious liability are also discussed in the report.TASK 11.1A contract is an agreement between two or more than two parties that is intended to beenforceable by law. A contract is like a promise between two parties to do something in returnfor a valuable benefit known as consideration. Following are the essential elements to form avalid contract:-Offer and Acceptance: To form a valid contract, there must be an offer by one party anda proper acceptance by another. When the offer is accepted, it becomes an agreement.When the agreements are enforceable by law, it becomes a valid contract. All contractsare agreements but all agreements are not contract.Intention to create Legal Relationship: Besides offer and acceptance, the agreementmust create a legal relationship between parties. One party can go to the court of law incase if another party does not meet their promise. When there is no such intention, thereis no contract. This is the reason because of which social and domestic nature do notcontemplate legal relationship.3
Legal Consideration: Consideration means something in return for the promise. Theagreement must have lawful and real consideration. Without consideration, it will be abare promise that cannot be enforceable by law.Free Consent: The consent of parties must be free. It should not be obtained by coercion,undue influence, fraud, misrepresentation and mistake. If consent of party is affected byany of the above elements, contract cannot be called as a valid contract.Parties must be Competent: If the parties do not have ability to fulfill the conditions ofcontract, then it cannot be called as a legal contract. The parties must have variedcapabilities such as age of majority, sound mind and not disqualified by the law to enterinto a contract.Lawful Object: The object of contract must be lawful. It must not be immoral, fraudulent,unlawful or opposed to public policy and its welfare.Not Expressly Declared as Void: The contract must be enforceable by law and it mustnot be declared to be void.1.2The impact of forming contracts can be described as:Face-to-Face- In face to face contracts, both parties decide the norms and conditions ofagreements by sitting next to each other. These contracts are generally made in oral form whereno document work is carried out. It is a mutual agreement between the parties where chances ofbreach of contract is on higher side.Written Contract- Written contracts are the agreements between two parties wherenorms and conditions of contract are carried out through documents(Mengoni and et.al., 2014).At the time of breach of contract, written contract helps both the parties. Written documents lastfor long time so, it can help as a legal proof at the time of breach of contract. Innocent party cansue the defendant party where any misconduct happens. Distance Selling- When the parties cannot present physically, they can go for distanceselling. Distance selling contracts generally involve buyers and sellers. They can purchase andsell the products as per distance selling contracts. Television, Internet, Emails and telephoneshelp them to gain the information about products and services and then purchase and sell4
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