Report On Essential Elements To Form A Valid Contract

Added on -2020-02-05

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Aspects of contract andnegligence act
Table of ContentsINTRODUCTION ..........................................................................................................................11.1 Essential elements of valid contract......................................................................................11.2 Impact of different type of contract......................................................................................21.3 Terms of contract..................................................................................................................22.1 Elements of the contract in the given scenario......................................................................32.2 Law of term in the given scenario.........................................................................................32.3 Effect of different terms in the given contract. ....................................................................4Task 2 ..............................................................................................................................................53.1 Difference between contractual liability and liability in tort................................................53.2 Nature of liability in negligence............................................................................................53.3 How a business can be vicariously liable..............................................................................64.1,4.2 Elements of tort of negligence and vicarious liability in the given situation..................6Conclusion.......................................................................................................................................7References........................................................................................................................................8
INTRODUCTION A contract is a legal agreement between two or more entities or parties in order to sharesomething between both along with developing a contractual relationship. “All contracts can beagreements but all agreements cannot be contract. The present report depicts about the variousessential elements that are required to form a valid contract. It includes offer also calledproposal, acceptance, free consent and intention to create legal relation for the contract. In thisreport, impact of different types of contract and terms of contract are discussed. Further, variouscase studies are also solved out by taking into consideration the various elements, terms ofcontract and various types of liabilities (i.e. liability in tort, contractual liability, liability innegligence). At last, various elements of vicarious liability are also discussed.TASK 11.1 Essential elements of valid contract.There are various types of elements which are required for the formation of a validcontract. Some of the important elements are described here as follows:-Offer: It is an act of offering something to the other person in order to sale or purchase thething. Offer can be made for the both tangible and intangible things (Ayres, 2012). If, offeroffered by the offeror is accepted by another person than in that case, offeror is bound by acontract. It does not includes requests for proposals, expression of interest and letter of intent.Further, it will be lapse if it is withdrawn before the acceptance. Case study-Carlill v Carbolic Smoke Ball Co [1893] 1 QB 256 Court of Appeal.According to the case Carbolic Smoke ball Company placed a add in there newspaper to rewarda person a sum of ... if he /she will catch the influenza by using these ball three to four times of aday. Thus, in lieu of which Mrs. Carlill caught the influenza after which she claim a reward fromthe company which Smoke Company refused. Thus, before using the ball Mrs. Carlill shouldshow her intention to accept the contract. Acceptance: It is an act of accepting proposal from the second party that is offered by thefirst party. An acceptance can be in a written or oral form. Once an offer is accepted by theacceptor than in that case a legal contract is formed. Moreover, if some modified terms of offerare accepted by the second party then it will not formed any legal contract. It will be consideredas other proposal. 3
Case study-Brogden v Metropolitan Railway (1877) 2 App. Cas. 666. According to thecase Brogden sent an agreement to the Metropolitan railway to supply the coal. In lieu of whichMetropolitan Railway drew a draft and send it to the Brogden. Brogden again sent it back to therailway company by filling up the some blanks which defendant has simply filled withoutshowing this intention to accept the contract. Therefore, in this case a valid contract has beenformed without any communication of the acceptance.Free consent: Consent is said to be free when it is made up of without any mistake,fraud, misrepresentation and so on. If, any of the above element is present at the time offormation of the contract than in that case a contract cannot be said as a valid contract (Barnett,2011). A contract is said to be free when it is made away from any fraud.Intention to create a legal relation: To create a valid contract, there must be intention ofboth the parties to create legal relation. A contract is said to be valid/legal when offer andacceptance are made by both parties with the availability of legal intention in order to form avalid contract. In most of the contract, where parties are related to each other they do not want tocreate a legal relation. Thus, it will not be considered as an legal contract. Case study-Balfour v Balfour [1919] 2 KB 571. According to the case study husbandmake an agreement to pay a sum of payment to his wife every month. Since, the husband wasleaving overseas. But after some time husband stop sending the money to her. Therefore,according to the case a contract cannot be said as a legal contract. It is only the social anddomestic contract between couples.1.2 Impact of different type of contract.Bilateral contract: - Bilateral contract is the contract in which both the parties are obligedto perform the act in an equal manner (Bisso and Choi, 2008). In other words, it can be said thatbilateral contract is the exchange of mutual trust and correlative promises between the partiesthat are obliged to perform the particular act. Case study- Butler Machine tool v Ex-cell_O Corporation [1979]. According to the caseEx-Cell-O placed an agreement in front of the Butler to purchase a machine for £75,535 whichwas accepted by the Butler. In lieu of which Ex-Cell-O prepared a contract which include aclause that if rate changes after 10 months then also he will purchased at the same price. WhichBulter signed without reading it? Afterwards when order to placed Butler claims an extra sum of4

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