Understanding of Different Essential Elements of Valid Contract

Added on -2020-02-05

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ASPECTS OF CONTRACT
TABLE OF CONTENTSINTRODUCTION...........................................................................................................................1TASK 1............................................................................................................................................11.1................................................................................................................................................11.2................................................................................................................................................21.3................................................................................................................................................3TASK 2............................................................................................................................................42.1................................................................................................................................................42.2................................................................................................................................................52.3................................................................................................................................................7TASK 3............................................................................................................................................73.1................................................................................................................................................73.2................................................................................................................................................83.3................................................................................................................................................8TASK 4............................................................................................................................................94.1................................................................................................................................................94.2................................................................................................................................................9CONCLUSION..............................................................................................................................10REFERENCES..............................................................................................................................112
INTRODUCTIONContract can be termed as the agreement made between two or more parties in order toform a mutual relationship among each other. It is essential for firm to follow the legal obligationappropriately so that desired results can be attained. The present study is based upon differentcase scenarios that highlights upon the understanding of different essential elements present toform a valid contract (Graham and Smith, 2006). From the study it can be assessed that there arevarious components of the contract and thus it is essential for parties involved within the contractneeds to consider such elements. Furthermore, here, tort liability and liability in negligence needsto be assessed through considering different case scenarios. TASK 11.1Contract can be termed as the legal agreement that is legally binding upon two partiesthrough mutual consent. It is usually refers as a written form but may be considered as eitherspoken or implied (Gillies, 2005). In the given case, Peter Abraham decides to launch a newbusiness venture of building contractor and thus requires to obtain information regardingformulating the contract. Following are the different components involved within the agreementare as follows- Offer and acceptance- It is an essential element of valid contract which requireslegal consent of both the individual involved within the contract requires. Here,offer has been made by the offerer to the offeree. Thus, it is essential for parties toformulate valid and legal contract in which parties needs to agree upon terms andconditions so that contract can be carried out legally. However, it is essential toboth the parties to agree to the offer made (BElliot and Quinn, 2009). The casereference to “Harvey V Facey [1893] AC 552” has been done. Here, it can beevaluated that one individual who is involved within the contract offers to sell hispen to another individual and in lieu the offerer assesses that he would buy thepen at £900.Legal consideration- Further, it can be stated that each and every contract needsto be backed up by any type of consideration. Consideration can be regarded asthe term that is given something in return to support the promise or contract. Itcan be in any form either money or things (Warren, 2013). Case reference is given1
of “Tweddle V Atkinson [1861] EWHC QBJ57”. Here, it assesses that individualinvolved within contract requires to make the contract upon legal actions and theyare not able to claim the damages on another individual without undertaking anyconsideration (MacMillan and Stone, 2009).Free consent- It is essential for parties to give free consent at the time of formingcontracts or agreements. Nevertheless, here, consent is not at all related to the freeconsent if it is occurred due to the coercion, under influence, fraud or forcefully(Savvidou and Broni, 2009). While, free consent are given by the parties as pertheir own wish and thus the decision remains upon their own wish. It can beevaluated that if Anna threatens Mary to beat her if she does not sell her her toAnna. However, in such case, Mary does not sell her pen on free consent butunder coercion. Hence, the contract is not valid (Jennings, 2010). Capacity of parties- It assesses that both the offerer and offeree should becapable enough to enter into contract. For instance, if individual is minor orunsound mind at the time of entering into the agreement then they are restricted tomake any contract as per the legal actions (Jerrell, 2010). It can be assessedthrough the case that the person who is minor i.e. Tom, borrowed £30 from Cathywho is major. Hence, here Cathy will not be able to obtain the amount from Tomas he is minor. Also, the agreement is not valid. It is because Tom is minor and heis not able to make contract with any other party (Sadah, 2010). 1.2In order to form a contract it involves different types i.e. face to face, written and distanceselling contracts. Following is the impact of forming the contract such as-Face to face contract- It is the contract that is made among two parties on thebasis of face to face interaction or orally. Here, both the parties are required toagreed upon the terms of oral conversation so that agreement can be carried outsuccessfully (Rogers, 2005). However, it provides negative impact upon thecontract and thus it is because there are not written proof or documents availablein relation to the contract through which at the time of fraudulence action it can beclaimed in the court of law. Therefore, parties generally prefers to avoid such typeof contract as there is no legal obligation in oral contracts. For instance, in case of2

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