Study on Provisions of Contract and Negligence Law

Aspects of
contract

TABLE OF CONTENTS
INTRODUCTION ..........................................................................................................................3
TASK 1............................................................................................................................................3
1. Types of contract and their impact..........................................................................................3
2. Description of term offer and acceptance along with the suitable case reference...................4
3. Assessment of existence of contractual relationship in given case scenario...........................5
4. Analysis of term in contract with reference to their meaning and effect.................................6
Task 2 ..............................................................................................................................................6
Contractual terms and its impact.................................................................................................6
Case a...........................................................................................................................................7
Case b...........................................................................................................................................8
Case c...........................................................................................................................................9
Case d...........................................................................................................................................9
Case e.........................................................................................................................................10
Task 3 ............................................................................................................................................10
Contrast contract liability in contract with tort..........................................................................10
Principles of liability in negligence...........................................................................................12
Provisions of vicarious liability.................................................................................................14
Task 4 ............................................................................................................................................15
Defenses ....................................................................................................................................15
Conclusion ....................................................................................................................................18
References......................................................................................................................................19
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INTRODUCTION
Legislation is developed by UK parliament to maintain decorum and prevent unfair acts
in the society. Civil law of UK deals with the daily activities in the nation in order to protect
interest of public. For this aspect, contract and negligence law is introduced which is mandatory
to be complied by individuals and business entities in their code of conduct (Adams, 2010).
Contract law is applicable in situation where parties enter into agreement through their mutual
consent while negligence law is applicable in absence of contractual relationship. Parties are
required to pay damages if they fail to act in accordance with the cited provisions by the
legislation.
Present study is focused on the description of significant provisions of contract and
negligence law in order to provide justifiable recommendations in the given case scenario. For
these aspect; essential elements, types and terms of contract will be explained with reference to
the suitable case precedents. Further, principles of negligence will be described along with the
provisions of available defences and vicarious liability. Described provisions will be applied in
the provided case facts in order to provide suitable advice to the parties.
TASK 1
1. Types of contract and their impact
Different forms of contract have different impact on the performance of the contracting
parties. By considering this aspect, Salvatore is required to select suitable form of contract in
order to attract customer from the further field (Appleman, 2014). Description of different types
of contract along with their impact to Salvatore is enumerated as below: Face to face contract: This contract is informal form of contract which is generally not
supported by the written deed. These contracts are supported by verbal agreement
described by the parties. If there is dispute in such contracts, then situational approach is
adopted by judicial parties to resolve the case as there is absence of deed that can provide
description of original terms (DiMatteo, 2012). Distance contract: The stated contract is selected by parties in case where they are not
able to meet at common place for the formation of agreement. Due to this aspect,
agreement takes places through mail or telephonic communication. Validity of distance
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contract is determined by the applicability of postal rule according to which acceptance is
considered valid if it is communicated to the offeror (Garriga, 2013).
 Written contract: This is the standard form of contract in which contracting parties is
required to prepare in order to describe their contractual obligations. This deed is
considered as legal evidence in situation of dispute. Due to this aspect, court of law
considers contractual deed to provide damages to the aggrieved party(Lockwood, 2011) .
By considering the provided case scenario, Salvatore is recommended to make use of
distance form of contract. For this aspect, he can create trading website which can upload
available second hand car along with the appropriate information and pictures (Bennett, 2011) .
In this manner, he will be able to attract large number of customers in minimum cost and time
consumption (Garriga, 2013). This will be considered as invitation on which offer will be
provided by customers through telephone or e-mails. In this manner, he will be able to know
about order placed by the customers and further he can deal accordingly.
Preparation of standard contract will be convenient for him while dealing with the small
garages. It is because; in this contract, entire terms and conditions will be pre-stated which will
be considered as a part of contractual deed (Giliker, 2010). Due to this aspect, parties contracting
with the Salvatore will be required to comply these terms. In this manner, MotorsRus will not be
required to prepare different contracts in transactions. However, if they want to make
modification then they can make modification or addition in that particular contract.
2. Description of term offer and acceptance along with the suitable case reference
Offer and acceptance are the basic elements of the agreement to be fulfilled by the
contracting parties (Manuel, 2011) . Offer can be defined as proposal given by one party either to
specific party or in general for the completion of certain performance. Offer provided by the
party is considered to be valid only if it is certain and lawful. It can be revoked by offeror prior
to the acceptance else revocation is not considered valid (Jennings, 2010). This aspect was
clarified in the case of Dickinson v Dodds (1876) 2 Ch. D. 463. Further, invitation to treat does
not have similar legal status to the offer. It is because; invitation to treat is merely a way to enter
into negotiation thus; it will not be considered as offer. In accordance with the case facts of
Pharmaceutical Society of Great Britain v Boots [1953] 1 QB 401, advertisement and good
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display in shops will be considered as invitation and shopkeeper has option to accept or deny the
offer provided by customers (Morris, 2010).
Binding contract is said to form only if valid acceptance is provided by the party to whom
offer was made. Acceptance is considered valid, if following aspects are satisfied:
 Acceptance must be communicated to the party by whom offer was provided (Entorres v
Miles Far East [1955] 2 QB 327)
 Terms of acceptance must be similar to the terms described in offer (Hyde v Wrench
(1840) 49 ER 132)
 It must be certain (Sudbrook Trading Estate v. Eggleton [1983] AC AC 444)
According to the case facts of Hyde v Wrench, conditional acceptance will be considered
as counter offer on which further acceptance is required to create valid contract. In addition to
this, counter offer revokes previous offer of the party.
In addition to the offer and acceptance, following element are also required to be covered
in agreement in order to make it enforceable:
Consideration : It is defined as mutual exchange of promises by the contracting parties, it
can be monetary and non -monetary value against the performance providence by the parties.
Intention : Both the parties of contract must have an intention to perform their duties
which is the foremost required of making a contract legal (Keenan, 2012).
Capacity of parties : The parties of the contract must legally capable which is the
foremost requirement of making a contract valid and enforceable. According to this parties may
be free of Mental Illness (Olander and Norrman, 2012) .
3. Assessment of existence of contractual relationship in given case scenario
By considering the described case scenario, it can be said Salvatore and Markus had
provided invitation to the various parties for the purchase of mechanic equipment. In this aspect,
various offers were provided by the parties. Salvatore had merely provided invitation thus; he is
in position to make decision of acceptance or rejection for the available offers.
On the basis of case facts, Salvatore had contractual relationship with the Mike. It is
because; offer provided by Mike has been accepted by the Markus. Further, money availed
through other offers have been refunded by Salvatore (Mann, 2013).
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However, Salvatore had also accepted the offer given by Danny through phone call thus;
he had responsibility to communicate this fact with the Markus but he failed to do so. As a
consequence, he will be liable to pay damages to the Dany i.e. additional cost for the purchase of
similar parts.
4. Analysis of term in contract with reference to their meaning and effect
Remedy to the contracting parties is provided in accordance with the classification of
contractual terms into conditions and warranties. Conditions are the primary stipulation of the
contract as it defines the main objectives for which contractual relationship was formed
(Pesqueux, 2012). If contracting party is not in position to satisfy conditions of the contract then;
innocent party has right to terminate entire contract and can sue faulty party for the damages
(McKendrick, 2012). Further, warranties are minor stipulation that provide clarification to the
main obligation of the parties. In situation where warranties are not satisfied by performance of
parties, then aggrieved party has only entitlement for the claim of damages.
In accordance with the provided description, condition of the contract is breached
because provided parts are not working in an appropriable manner. By considering this aspect,
Salvatore will be required to provide refund to the buyer. However, in situation where if some
parts were slightly different to the others in colour because of place where they had been stored,
then obligation will be only for compensation.
TASK 2
Contractual terms and its impact
Contractual terms can be defined as statements inserted to described obligations of the
parties. By considering these terms standard of contractual performance is determined by the
court of law (Nystén-Haarala, 2010). Bifurcation of contractual terms can be done in following
manner:
Expressed Terms
Expressed terms are inserted by considering mutual consent of the contracting parties.
These terms can be stated either in written or in verbal manner. Expressed terms are required to
be inserted prior to the formation of contract. In accordance with the case precedent of Chapleton
v. Barry Urban District Council (1940) if terms are inserted after formation of contract then it
will not be considered effective. Further, segregation of expressed terms can be done into
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