Business Law and Ethics: UK Court System and Contract Analysis

This report delves into the intricacies of contract law, a cornerstone of business transactions. It meticulously examines the essential elements of a valid contract, including offer, acceptance, and consideration, supported by relevant case laws. The report differentiates between an offer and an invitation to offer, using landmark judgments like Harvey vs. Facey and Carlill vs. Carbolic Smoke Ball Co. to illustrate key concepts. It also discusses the importance of intention to create legal relations and the capacity of parties involved. Furthermore, the report provides an overview of the UK civil court system, specifically addressing which courts are appropriate for contract disputes. The report then analyzes a hypothetical scenario, advising parties on the existence of a contract and potential outcomes. Finally, it outlines various remedies available to parties in case of contract breaches, such as compensation and specific performance. The conclusion reinforces the significance of contract law in business and emphasizes the importance of understanding the essentials for a legally sound agreement.

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BUSINESS LAW AND
ETHICS

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TABLE OF CONTENTS
Contents
INTRODUCTION.....................................................................................................................................2
MAIN BODY.............................................................................................................................................3
Discussion of Blue Prints of the Valid Contract..................................................................................3
Discussion the Court System of UK and Advise Parties Which Court They Can Approach...........5
Advise Hilary Whether a Contract present among Her and Others That are Eleanor, Amy and
Olivia......................................................................................................................................................5
Discuss Various Remedies Available to Them.....................................................................................6
CONCLUSION..........................................................................................................................................6
REFERENCES..........................................................................................................................................6
INTRODUCTION
Law of contract is a piece of law which is used mostly in every transaction which is
related to the business. This law helps in determining the rights and obligations of the contracting
parties. It also helps in protecting the rights of the contracting parties. It is necessary that every
agreement which is formed must be having all the necessaries of the valid contract because on
the presence of all the essentials of a contract only, the court will give the parties some relief in
form of compensation. It is the duty of the court to determine the validity of the contract by
seeing that all the essentials of the valid contract are present in the disputed agreement or not. In
this report it will be seen that what all are the essentials of the valid contract such as Offer,
Acceptance and Consideration by referring various case laws. Further certain fact based
problems will be studied and it would determine whether any valid contract exist between the

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parties or not. The various remedies which are present to the contracting parties under the law of
contract will also be discussed.
MAIN BODY
Discussion of Blue Prints of the Valid Contract
A contract is a legally enforceable agreement that is created for a particular purpose
between two or more persons. This document will be having certain terms and conditions which
will be determining the rights and duties of each contracting party. If any of the party violates the
terms and conditions of the agreement, the other party (who has faced the loss due to violation of
the contract) gets right to approach the court of law and claim the compensation for the loss
occurred.
The court in this case will determine and examine the validity of the valid contract as
well as will see whether all the essentials of a valid contract are available or not in order to award
damages(Allen and Kraakman, 2016).
The first importance of a valid contract is Offer which must come from the side of the
offeror. The individuals making the offer will be called as Offeror whereas the person to whom
the offer would be made is known as Offeree. The offer is nothing but a proposal which comes
from the side of one person and gets accepted by another person. Many times individual get
confused among an offer and an Invitation to Offer. The major example of the invitation to
offer is advertisements or notices which are put by people. Here these notices will be stated as an
invitation to offer as well as individual who will be seeing these notices or advertisements will be
said as making an offer. The landmark judgement in that the court has differentiated between an
offer along with an invitation to offer is Harvey vs Facey. In this famous case the Privy Council
has difference between these two terms. There was a question before the Privy Council whether
the telegram by which the lowest price of the property was quoted should be said as an offer or
an invitation to offer. Here the Council clarified that it was an invitation to offer and when the
real offer came from the of offeror’s side who was plaintiff in this case, it was rejected by the
defendant(Ashcroft, Ashcroft and Patterson, 2016).
In the other judgement of Fisher vs Bell(1961), it was carried that all the items which are
presented in the shop or any of the showrooms, will be stated as an invitation to offer. The

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customer or the person who wants to buy those items will be making the offer to the shopkeeper
and now it’s the discretion of the shopkeeper whether he wants to accept the offer of the
customer or not.
Carlill vs Carbolic Smoke Ball Co. is also the landmark judgement upon this distinction
where the defendant company argued that its advertisement was an invitation to offer. This
contention was rejected by the Privy Council.
The second step or the essential for the formation of a valid contract is Acceptance. The
offer which has been given must be accepted by the person to whom the offer has been made. It
is also necessary that the communication must be transferred to the offeror and if any mode for
the communication has been present under the offer, the acceptance should be communicated in
that way only. For example, if in any offer it is written that the acceptance must be
communicated through postal method only, the acceptance will be deemed as properly
communicated only if it was sent through the letter. Regarding revocation of the acceptance, it is
a basic rule that the acceptance could be revoked anytime before it comes into the understanding
of the offeror. While there is an exception to this rule which states that if the acceptance has been
given by posting the letter, it could not be revoked once the letter has been posted or it has been
put in the channel of transmission. The revocation of acceptance after this stage will be
considered as breach of contract)(Beatty, Samuelson and Abril, 2018).
The next essential which is required for the formation of a valid contract is
Consideration. It means that parties while doing the consideration must exchange something,
either in monetary terms or any set of promises. A contract which does not have any
consideration will not be regarded as valid piece of contract. It is also a fact that inadequacy of
the consideration amount will not make the contract as invalid (Ramseyer, 2017).
There must be Motive to Enter into a Legal Relationship between the contracting
parties. The landmark judgement upon this necessary is Balfour vs Balfour in which it was
stated if at the time the parties who have entered into the agreement lacks the intention of
entering into the legal relationship, the contract will held as an invalid(Miller, 2016).

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All the parties must be having the capacity to enter into the contract which means that the
persons entering into the contract must not be a Minor or Insolvent. Also it is necessary that
subject topic for which the contract has been made must be specific in nature.
Discussion the Court System of UK and Advise Parties Which Court They Can Approach
In this essay the civil court system of UK will be explained. The Queen’s Bench of High
Court is empowered to handle with the civil issues and as the contract is the part of civil law, it
will be dealt by this court only. For those contractual conflicts in which there is less number is in
dispute, the County Court is empowered to handle such cases (Jan and Harm, 2019). English
legal system is referred to as common legal system of England as well as Wales that consists of
criminal laws along with civil laws
The appeal from Queen’s Bench will lie to Court of Appeal and then to Supreme Court
of UK which was formed by the Constitutional Reform Act 2005(McCormack, 2017).
The parties are advised to either approach the Queen’s Bench of High Court or County
Court as per the disputed amount.
Advise Hilary Whether a Contract present among Her and Others That are Eleanor, Amy
and Olivia
Hilary and Eleanor: In the given facts it is clear that there does not exist a valid piece of
contract between both the parties. The above discussed principle of distinction among an offer as
well as an invitation to offer should be applied on the given facts. In thefamous judgement of
Partridge vs Carttinden it was carried that all the advertisements will be said as an invitation to
offer.
Hilary as well as Amy: It was above discussed that if the acceptance has been sent by
the letter or postal method, it could not be revoked after it has been put in the mode of
transmission. By applying this principle on the given facts, it becomes clear that Amy has sent
her acceptance through postal method, hence she cannot revoke her acceptance as she has carried
through the letter(Jones, 2019).
Hilary and Olivia: The notices are also said as invitation to offer. Here the offer was
Hilary. The offer came from the side of Olivia that was not accepted by Hilary. Hence no valid
contract exists among both the parties.

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Discuss Various Remedies Available to Them
Compensation: It is the most primary remedy awarded by the courts which is in
monetary terms. Here the court before awarding the compensation will see the validity of the
contract in question and also examine the loss which has occurred was direct and
foreseeable(McCormack, 2017).
Specific Performance: In this the court will order the party who has violated the contract
to specifically perform the contract. This remedy will be awarded by the court when the
compensation will not be an adequate remedy.
CONCLUSION
It can be concluded by the above study that the contract law is very widely used law in
business transactions. While doing a contract it must be seen that an agreement should possess
all the essentials of a valid contract. It was also explained that what all solutions are present to
the parties who have entered into the contract. Through referring different case laws, the
approach taken by courts in various circumstances was also understood.

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REFERENCES
Books & Journals
Allen, W. T. and Kraakman, R., 2016. Commentaries and cases on the law of business organization. Wolters
Kluwer law & business.
Ashcroft, J.D., Ashcroft, K. and Patterson, M., 2016. Cengage Advantage Books: Law for Business. Cengage
Learning.
Beatty, J.F., Samuelson, S.S. and Abril, P., 2018. Business law and the legal environment. Cengage Learning.
Jan, K. nd Harm, W., 2019. A Basic Guide to International Business Law. Routledge.
Jones, L., 2019. Introduction to business law. Oxford University Press, USA.
McCormack, G., 2017. Business restructuring law in Europe: making a fresh start. Journal of Corporate Law
Studies, 17(1), pp.167-202.
Miller, R.L., 2016. Business Law Today, Comprehensive. Cengage learning.
Ramseyer, J.M., 2017. Aspen Treatise for Business Organizations. Wolters Kluwer Law & Business.
Smith, D. G. and Williams, C. A., 2018. Business Organizations: Cases, Problems, and Case Studies. Aspen
Publishers.
Sulkowski, A.J., 2018. Blockchain, law, and business supply chains: The need for governance and legal frameworks
to achieve sustainability. Available at SSRN 3205452.