Provisions of the Contract Law : Report
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Added on 2020-01-15
Provisions of the Contract Law : Report
Added on 2020-01-15
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Contract law is developed by English legislation to ensure standard performance byparties. Further, this law describes obligation of damages in situation where parties fails toprovide satisfactory performance (Chadwick, 2011). Present study is based on description andapplicability of various provisions of the contract law. For better understanding of theseprovisions previous case precedents will be considered. LETTER 1To, Bob and Sam Subject: Explanation of essential elements in a business contextAgreement formed by Bob and Sam will be considered legally enforceable only iffollowing elements of contract are present in it:Offer and acceptanceThere must be qualified offer and acceptance between parties to create valid agreement.For this aspect, offer must be clear and specific (Taylor, 2011). It must not include ball parkestimates, invitation to treat or letter of intent. Further, acceptance must be on the terms that areoffered by offeror to offerree else it will be treated as the counter offer.(Invitation to treat is distinct from the offer because it is mere declaration of willingnessfor entering into negotiations. Thus, it cannot be accepted for forming contract.)Intention to create legal relationsContracting parties must have intention to enter into legal binding agreement toaccomplish their promises (Milner, 2011). This element is presumed to be part of the contract.ConsiderationAgreement of parties must be supported by valuable consideration (mutual exchange ofpromises). It is not required to be fair but it must not be supported by duress, fraud orunconscionable conduct. Capacity:Parties to the contract must be in the position to enter into legal enforceable agreement(Nystén-Haarala, Lee and Lehto, 2010). For this aspect, they must not qualify quality of minor,lunatic, insanity and disqualification by law 2
Privity of contractIt is a doctrine in English contract law according to which the third party to the contractis not in the position to sue the faulty party for the damages (Schulze, 2007).Advice to Bob and SamIn the present contract, Sam had provided invitation to treat to his customers for sellingthe book. On the response offer has been provided by the Bob for purchasing the book.However, last copy of that book is already sold to Carl and Sam forgot to remove it fromdisplay. In this case, Sam is entitled to refuse the offer provided by Bob as invitation does notimpose legal obligation for acceptance.Contracting parties are required to select suitable form of contract because each type hasdifferent impact. Description of various types of contract and their impact is enumerated below:Face to face: In this type of contract, parties are present at similar place for discussing contractualterms. Generally, these contracts take place in verbal manner and quick acceptance is providedelse the offer is considered to be lapsed (Blum, 2007). Example of face to face contract ispurchase of clothes from retail store.Written:Written contracts are the most formal form of contract as parties are required to preparedeed to describe contractual terms and conditions. In such contracts, damages are provided asper the deed to aggrieved party (Mote, 2013). Example of written contract is sale of immovableproperty by one party to another. Distance selling: This form of contract takes place when parties are not present at same place fordiscussion (Clarkson, 2010). Validity of these contracts is determined by postal rule anddistance selling regulations. Example of distance contract is purchasing from the tradingwebsites. Categorization of contractual terms into conditions and warrantiesCondition is fundamental term which is essential in any type of contract because iscalled major term in any type of contract thus, breach of this term gives right to innocent partyto either breach whole contractual liability or demand compensation for loss arise by the breach3
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