Essential Elements of a Valid Contract - ACNB Assignment

ACNB

TABLE OF CONTENTS
Introduction......................................................................................................................................3
Task 1...............................................................................................................................................3
1. Importance of essential elements required for the formation of valid contract.......................3
2. Description of different types of contract along with their impact..........................................4
3. Description and impact of different type of contractual terms................................................5
4. Case study of Ivan and Todor..................................................................................................6
5. Case study of Adam and Brian................................................................................................6
6. Case study of Barry and local council.....................................................................................7
Task 2...............................................................................................................................................8
Contrast liability in tort with contractual liability.......................................................................8
2. Scenario A................................................................................................................................9
Scenario B....................................................................................................................................9
Case of Mark and Regent Hotel...................................................................................................9
Conclusion.....................................................................................................................................11
References......................................................................................................................................12
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INTRODUCTION
Contract and negligence law is introduced to provide norms regarding standard duties of
parties in order to protect interest of public. Individuals are required to act in accordance with the
provided duties by law in order to discharge their obligations in a proper manner (Adams, 2010).
Present study highlights key provisions of the contract and negligence legislation. For this
aspect, essential elements of contract will be explained. In addition to this, description of
contractual terms and different types of contracts will be provided along with its impact. In
second part of the report, negligence law will be explained along with provisions of defences and
vicarious liability. Described provisions in this study will be linked to provided case scenario for
justified recommendations.
TASK 1
1. Importance of essential elements required for the formation of valid contract
For the formation of valid contract following elements are required to present in the agreement
of parties: Offer and acceptance: Without presence of offer and acceptance, agreement cannot be
created between parties. Offer is expression of willingness given by the offeror to the
specific party or to the general public (Blum, 2007). Further, acceptance is consent
provided on the given offer. Acceptance is said to be valid if it is not supported by
modification and it is given by the party to whom offer is provided.
◦ Case scenario: In the case of Fisher v Bell [1961] 1 QB 394 court of law had not
considered the contractual relationship between parties because display of goods had
been considered as invitation which cannot be considered as offer. In the case
precedent of Felthouse v Bindley [1862] court had declared the mere silence cannot
be considered as acceptance by the offerree. Intention- In accordance with this element, parties entering into contract must have
intention to create enforceable relationship in order to provide satisfactory performance
(Emerson, 2009). However, this element is not expressly stated but in charitable and
domestic contract this element is not assumed.
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◦ Case scenario- In the case of Balfour v Balfour [1919], agreement created between
parties was not held enforceable by court of law because it was created between
husband and wife. As a consequence, it was considered as domestic agreement. Consideration : Consideration can be termed as anything either monetary or non-
monetary paid by one person to another in return for benefits received by him under a
contract. The paid part should be of value (Frey and Frey, 2001).
◦ Case Scenario : In accordance with the case of Thomas V Thomas, anything whose
value can't be identified or is of no value will not be considered as Consideration, also
it should be paid in exchange of benefits/services received from other party (Lawful
consideration,2011). Privity of Contract : It states that any obligations can be imposed only on the parties to
the contract, not on any other person. No legal action taken by third party stands valid if
he had taken such action beyond the benefits entitled to him.
◦ Case Scenario : As per the judgement provided in the case of Tweddle V Atkinson,
any person other than a person to contract (Third Party) cannot pay consideration.
2. Description of different types of contract along with their impact
In order to have formation of contractual relationship participators mostly focuses on
different forms of contract. In the support of this, it can be said that the diverse kinds of contract
influence contractual roles and responsibilities of all parties (Hasen, 2010). By considering this
aspect, provided statement is not true. Classification of diverse kinds of contracts can be as
follows: Unilateral contract- It is one of critical legislation in which offeror is having number of
boundations to perform diverse actions under contract. In this respect, the offer is mostly
presented in general manner and all parties have eligibility towards acceptance (Heine
and Kerber, 2002). In order to understand unilateral contract, learner can focus on case of
Carlill v Carbolic smoke ball. Implied contract- In this contract the actions plays key role in formulation process rather
than verbal or written statement. In other aspect, implied contract is also considered as a
conduct contract (Middlemiss, 2011). Moreover, to have better understanding about this
contract the case of travel in local bus can be considered.
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