Business Law 2 Assignment: Contract Law Analysis and Application

This assignment delves into the core principles of contract law, examining the essential elements required for a legally binding agreement. It defines a contract as a legally enforceable agreement involving an offer, acceptance, and consideration, which creates obligations between parties. The assignment explores the concepts of offer and acceptance, highlighting the importance of clear communication and intent to be bound. It also analyzes a scenario involving two businesses and explores the legal implications of a contract, including breach of contract and the potential for damages. The assignment emphasizes the importance of intention to create a legal relationship, as well as the role of consideration in making a contract valid. The provided scenario highlights a situation where an offer is made and accepted, but subsequently altered, which constitutes a breach and the right of the offeree to seek damages. The assignment also provides a comprehensive bibliography of supporting legal resources.

Corporate /Business Law
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Business Law 2
Question 1
A contract is a legally binding agreement that involves one party giving an offer and
another party or another party accepting the offer in exchange for a consideration that creates a
legal obligation between the two or more parties1. A contract subsequently outlines the privileges
and responsibilities of the parties to the agreement2. Failure to honour the spirit and letter of a
legally binding contract attracts compensation of damages by the breaching party, however,
before that is done, a Court of law must first determine if the contact is valid, legally binding as
well as enforceable long before the determination of whether or not there was a breach3. Such a
determination rests upon the four key rudiments of an agreement that include an offer,
acceptance, as well as a purpose to produce legal connection, and consideration4.
An offer refers to an assignment that is prepared by the offeror with the intent to attain
legality by the various conditions of the deal upon the offeree accepting the offer5. The proposal
must either express or imply a promise that is legally binding, failure to which it becomes an
invitation to treat rather than a legally binding agreement6. An offer as a concept is critical in the
determination of the legality and binding nature of a contract since it helps in differentiating it
from an invitation to treat that is never a binding contract but rather an invitation for offers. Cliff
offered the service to Rick.
1 Knapp, Charles L., Nathan M. Crystal, and Harry G. Prince. Problems in Contract Law: cases and materials. Aspen Publishers, 2019.
2 Behdinan, Asha, Steven J. Hoffman, and Mark Pearcey. "Some global policies for antibiotic resistance depend on legally binding and
enforceable commitments." The Journal of Law, Medicine & Ethics 43, no. S3 (2015): 68-73.
3 Giancaspro, Mark. "Is a ‘smart contract’really a smart idea? Insights from a legal perspective." Computer law & security review 33,
no. 6 (2017): 825-835.
4 Poole, Jill. Textbook on contract law. Oxford University Press, 2016.
5 Lindsay, Bruce. "Legal instruments in private land conservation: the nature and role of conservation contracts and conservation
covenants." Restoration Ecology 24, no. 5 (2016): 698-703.
6 Morley, John. "The Common Law Corporation: The Power of the Trust in Anglo-American Business History." Colum. L. Rev. 116
(2016): 2145.

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Acceptance is an act of an offeree accepting the terms of the contact and agreeing to
perform the respective rights and obligations of the contract7. The implication is that an
acceptance must be unreserved and unrestricted of every standing stated in the agreement8. A
rejection of the terms of the offer resulting from the variations does not constitute acceptance but
terminates the offer9. Nonetheless, variations in the terms of the contract constitute a counter-
offer that is considered to open for acceptance10. It follows; therefore, that approval of an
suggestion by the offeree constitutes a legally binding contract. Rick, the offeree accepted the
offer by Cliff, the offeror.
A legally binding contract is one in which all parties have the intention being legally
bound by way of committing to their particular contractual privileges and commitments11.
Notably, a mere response to an enquiry or just a request for information would not constitute an
intention to enter into a legal and binding contract or relationship12. Similarly, the Courts
generally consider agreements that parties enter into in domestic or social settings as not having
intention for legal consequences13. However, in such circumstances, a Law court would examine
the flawless statements that the persons involved in such agreements intended to be legally
bound14.
7 Miller, Roger LeRoy. Business Law Today, Comprehensive. Cengage learning, 2016.
8 Gellhorn, Walter, Clark Byse, Peter L. Strauss, Todd D. Rakoff, and Roy A. Schotland. Administrative law: Cases and comments.
Vol. 1. Foundation Press, 1960.
9 Mann, Richard A., and Barry S. Roberts. Business law and the regulation of business. Nelson Education, 2015.
10 Knapp, Charles L., Nathan M. Crystal, and Harry G. Prince. Problems in Contract Law: cases and materials. Aspen Publishers, 2019.
11 Management Association, ed. Business Law and Ethics: Concepts, Methodologies, Tools, and Applications: Concepts,
Methodologies, Tools, and Applications. IGI Global, 2015.
12 Friedman, Lawrence M., and Stewart Macaulay. "Contract Law and Contract Teaching: Past, Present, and Future." Wis. L.
Rev. (1967): 805.
13 Orts, Eric W. "Corporate Law and Business Theory." Wash. & Lee L. Rev. 74 (2017): 1089.
14 Mayss, Abla, and Alan Reed. European Business Litigation. Routledge, 2018.

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A legally binding contract must be having a consideration that is exchanging for a
promise that the parties are willing to enforce and the consideration must have a value attached
to it15. Legally, the value of the consideration must be equal or commensurate to the promise
given that a deal of an insignificant value can constitute a satisfactory consideration. This
element of an agreement, more often than not, is satisfied in most cases16. Rick paid for the
service as offered by Cliff.
Question 2
The agreement between Rick, offeree, and Cliff, offeror had the intention of legal binding
because in as much as it was between two cousins, it involved two serious businesses Subiaco
Marketing Firm and ‘Once Upon a Time Pty Ltd’ and not just a domestic chat17. A consideration
exists because Cliff had shared the price with Rick, who accepted it. A change of the terms of the
contract by Cliff, therefore, translates into a counter-offer that Rick can either accept or reject
because it is now open18.
The scenario of Rick and Cliff constitute a legally binding contract because it meets the
threshold of a valid and legally enforceable contract. The scenario envisages the four key
elements of a contract19. The variations in the agreement by Cliff amount to a breach and Rick
has the right to seek for damages in a Court of law20. The offeror cannot have the privilege of
15 Frank, Jerome, and Brian H. Bix. Law and the modern mind. Routledge, 2017.
16 Cleaveland, Mary Catherine, Christen Dutcher, and Kathryn Epps. "Comparing Business Law in online and face-to-face formats: A
difference in student learning perception." Academy of Educational Leadership Journal 19, no. 1 (2015): 123.
17 Beale, Hugh, Bénédicte Fauvarque-Cosson, Jacobien Rutgers, and Stefan Vogenauer. Cases, materials and text on contract law.
Bloomsbury Publishing, 2019.
18 Boone, Louis E., David L. Kurtz, Michael H. Khan, and Brahm Canzer. Contemporary business. John Wiley & Sons, 2019.
19 Ariffin, Azni, and Noor Inayah Yaakub. "Unidroit principles of international commercial contract as the rules of law governing cross
border contracts." Advanced Science Letters 23, no. 1 (2017): 478-481.
20 Poole, Jill. Casebook on contract law. Oxford University Press, USA, 2014.

Business Law 5
giving an offer and changing the terms of the contract after receiving acceptance from the offeree
as in the case in this scenario21.
21 Beatty, Jeffrey F., Susan S. Samuelson, and Patricia Sánchez Abril. Business law and the legal environment. Cengage Learning, 2018.

Business Law 6
Bibliography
Ariffin, Azni, and Noor Inayah Yaakub. "Unidroit principles of international commercial
contract as the rules of law governing cross border contracts." Advanced Science
Letters 23, no. 1 (2017): 478-481.
Beale, Hugh, Bénédicte Fauvarque-Cosson, Jacobien Rutgers, and Stefan Vogenauer. Cases,
materials and text on contract law. Bloomsbury Publishing, 2019.
Beatty, Jeffrey F., Susan S. Samuelson, and Patricia Sánchez Abril. Business law and the legal
environment. Cengage Learning, 2018.
Behdinan, Asha, Steven J. Hoffman, and Mark Pearcey. "Some global policies for antibiotic
resistance depend on legally binding and enforceable commitments." The Journal of Law,
Medicine & Ethics 43, no. S3 (2015): 68-73.
Boone, Louis E., David L. Kurtz, Michael H. Khan, and Brahm Canzer. Contemporary business.
John Wiley & Sons, 2019.
Cleaveland, Mary Catherine, Christen Dutcher, and Kathryn Epps. "Comparing Business Law in
online and face-to-face formats: A difference in student learning perception." Academy of
Educational Leadership Journal 19, no. 1 (2015): 123.
Frank, Jerome, and Brian H. Bix. Law and the modern mind. Routledge, 2017.
Friedman, Lawrence M., and Stewart Macaulay. "Contract Law and Contract Teaching: Past,
Present, and Future." Wis. L. Rev. (1967): 805.
Gellhorn, Walter, Clark Byse, Peter L. Strauss, Todd D. Rakoff, and Roy A.
Schotland. Administrative law: Cases and comments. Vol. 1. Foundation Press, 1960.
Giancaspro, Mark. "Is a ‘smart contract’really a smart idea? Insights from a legal
perspective." Computer law & security review 33, no. 6 (2017): 825-835.

Business Law 7
Knapp, Charles L., Nathan M. Crystal, and Harry G. Prince. Problems in Contract Law: cases
and materials. Aspen Publishers, 2019.
Lindsay, Bruce. "Legal instruments in private land conservation: the nature and role of
conservation contracts and conservation covenants." Restoration Ecology 24, no. 5
(2016): 698-703.
Management Association, ed. Business Law and Ethics: Concepts, Methodologies, Tools, and
Applications: Concepts, Methodologies, Tools, and Applications. IGI Global, 2015.
Mann, Richard A., and Barry S. Roberts. Business law and the regulation of business. Nelson
Education, 2015.
Mayss, Abla, and Alan Reed. European Business Litigation. Routledge, 2018.
Merkin, Robert, and Séverine Saintier. Poole's Casebook on Contract Law. Oxford University
Press, 2019.
Miller, Roger LeRoy. Business Law Today, Comprehensive. Cengage learning, 2016.
Morley, John. "The Common Law Corporation: The Power of the Trust in Anglo-American
Business History." Colum. L. Rev. 116 (2016): 2145.
Orts, Eric W. "Corporate Law and Business Theory." Wash. & Lee L. Rev. 74 (2017): 1089.
Persadie, Natalie, and Rajendra Ramlogan. Commonwealth Caribbean Business Law. Routledge-
Cavendish, 2015.
Poole, Jill. Casebook on contract law. Oxford University Press, USA, 2014.
Poole, Jill. Textbook on contract law. Oxford University Press, 2016.
Twomey, David P., Marianne M. Jennings, and Stephanie M. Greene. Anderson's Business Law
and the Legal Environment, Comprehensive Volume. Nelson Education, 2016.

Business Law 8
Wilkinson-Ryan, Tess, and David A. Hoffman. "The common sense of contract formation." Stan.
L. Rev. 67 (2015): 1269.