Analysis of Contract Law Principles in Business Scenarios

Desklib offers solved assignments and past papers to help students succeed.

Business law for managers

Contents
Business law for managers..............................................................................................................1
Introduction......................................................................................................................................3
1...................................................................................................................................................4
(a) Under the law of England and Wales, what is a contract and what are the requirements for
a valid contract to be formed?.....................................................................................................4
b) Is Ringo liable to pay Paul on the basis of the facts given above?..........................................5
2...................................................................................................................................................7
In light of the facts above, discuss the criteria that Jerry (as the claimant) would need to satisfy
in an action for negligence...........................................................................................................7
3...................................................................................................................................................9
Identify the main business mediums available to Ringo and his friends John and Yoko and the
advantages and disadvantages of each of these mediums...........................................................9
4.................................................................................................................................................11
Discuss why it is important for Ringo, John and Yoko to identify the correct employment
status of any workers that they recruit for their business..........................................................11
References......................................................................................................................................12

Introduction
It is seen that the business organisation in the country are governed by the business laws that are
made by the government of the country. This is seen that there are various legal requirements
that the business organisation needs to follow so that they are able to achieve the objective of
operating according to the required laws. The law helps the organisation in the country to
achieve the objective of dealing with the both private and the public laws so that they are able
operate as per the requirements of the law (Adriaanse, 2016). It is seen that the business law also
relate to the partnership formation, company formation, bankruptcy and various other aspects
related to it. It is seen that this law also specifies the provisions that are related to employer and
employee relationship and the employment contract related to it. This report is based on the case
where successful gardening business as a sole trader is being done. This is seen that Ringo wants
to expand this business in order to achieve the maximum profits.

1.
(a) Under the law of England and Wales, what is a contract and what are the requirements for a
valid contract to be formed?
The contract is considered to be the written or the oral acceptance of the terms and condition that
are defined by the parties entering into contract. This is seen that the for the purpose of making
the contract it has to be enforced by the court system and hence through this agreement as per the
terms of the contract would be made (Beale, et. al., 2019). This is seen that if once the promise is
made then it has to be the made enforceable through the process of making the contract. It is seen
that for the formation of the contract there are various requirements that are required to be
fulfilled which includes,
 For the formation of the contract there must be the offer and acceptance from both the
offeror and the offeree.
 The contract that is formed between them must include the consideration which must
move from the offeree to offeror. It must be mutually decided among the parties to the
contract.
 The main thing that involves is intention to create the legal obligation for the contact that
is being made in this consideration.
It is seen that for the formation of the contract these above condition must be fulfilled. So this
can be said that the contract is defined as the legal agreement that is binding on the parties to the
contract and is written and in oral form. It is seen that individuals normally have the
misconception that the contract has to be in written form so as to make it legal. While this is seen
that the contract can be legal if also done in the form of oral sense. The contract is considered to
be unique if this is made under certain terms that are defined by the party’s entering into the
contract. The parties to the contract are considered to be free for making the terms for the
contract whichever they wish to enter but these must be legal have some legal consideration for
the same. This element is considered to be the freedom of the parties to the contract. Hence the
parties to the contract are free to agree upon the terms of the contract as per their choice. It is
seen that the contractual relationship is formed between the parties to the contract hence the
terms of the contract is considered to be civil in nature. The contract law is one of the element of
the common law. Hence for the formation of the contract various rules and regulations apply

which helps in formation of the contract more significantly. Various terms for the formation of
the contract includes the following:
Offer This is the first stage for the formation of the
contract where the offer is given by the offeror to
the offeree. This is also seen that it can be
invitation to offer.
Acceptance This is seen that for the formation for contract the
second stage contains the acceptance of the offer
made by the offeree (Cartwright, 2016). This is
seen that all the terms of the contract must be
acceptance by the offeree.
Consideration It is seen that for making the contract valid t is
necessary to have consideration in the contract
which must move from the offeree to the offeror.
This must be adequate and must be legal.
Intention of making it Legal This is seen that for the purpose of making the
contract legal it is seen that parties to the contract
must have the intention of making the contract
legal as this would help them to achieve the
objective of making it legally acceptable.
Hence this is seen that these are the terms that the contract must have so as to make it valid and
acceptable.
b) Is Ringo liable to pay Paul on the basis of the facts given above?
This is seen that for the purpose of understanding the issue, a deep look at the transaction and the
terms has to be done so as to achieve the objective making the suggestion on the basis of the
issue that has arose.
Issue
It is seen that Ringo is successful entrepreneur who is having the business of gardening and
having the landscape in the name of Elixir gardens. The structure of the organisation is in the
form of sole trader. Paul son of Ringo has come to home on the holiday in the weekend from the
university and has given offer to his father so as to mow the lawn that is attached to their home

for the consideration of 10GBP. His father accepted the offer for the consideration that was
decided among them. After this the contract was considered to be performed and his son mowed
the lawn as per the terms decided in the contract. After this Ringo refused to pay the amount
which was decided in the contract between them. Hence Paul wants the suggestion as if he can
go to court for getting the amount that is due as per the contract.
Rule
As per the terms of the contract act this is seen that contracts are formed by the process of having
the mutual consensus for the terms that are decided among them. It is seen that the consideration
is considered to be the main part for the contract which moves at the desire of the offeror and is
mutually decided among them (Huang and Lan, 2016). Therefore this is considered that if the
parties to the contract breaches the terms of the contract then other party can go to court so as to
sue them for the price that is decided. It is considered that court after viewing the contract and
breach that has been done in this context can give the decision so as to make the payment to the
other party and also may give the decision of penalty against the breaching party.
Application
Therefore in the given case this can be seen that Ringo did not fulfilled the terms of contract and
also did not paid the consideration which was decided among Paul and Ringo. Hence this is seen
that Paul can go to the court so as to achieve the objective getting the decision in favour of him
so as to get the amount that was decided mutually between them. It is seen that there are various
forms of penalty that are decided by the court and hence this can be given in the case of breach
of the contract. Hence this is seen that Ringo is liable to pay the amount to the Paul as decided in
the contract otherwise penalty may also be imposed on him for the breach of contract.

2.
In light of the facts above, discuss the criteria that Jerry (as the claimant) would need to satisfy in
an action for negligence.
The term negligence in tort is considered to be the breach of legal duty of taking care when the
performance of the contract is considered to be done. This is seen that for the purpose of making
the defendant liable for the wrong that is done by him it must be proved that claimant has the
duty to take care at the time of performance of the contract (Hutchison, 2017). Also this is seen
that there must be breach of duty that has to be performed by the party to the contract. Also this
is seen that act that are performed by the party to the contract must cause loss to one or other
party. It is also seen that the loss which has been caused must not be considered to be raised as a
defence against the claimant actions.
As per the general principle for determining the existence of the duty to take care in Donoghue V
Stevenson (1932) this was seen that the judge decided that the person must take reasonable care
so that they are able to avoid any type of miss happening that occurred while completing the
contract. It is also seen that the person who is directly affected through the act that is performed
then they would be in the contemplation as they are being so affected when they are directing the
mind towards the questions.
It is considered that there is duty to take care for the people which are closely affected by the
terms and actions which are described by them. It is seen that there is alternative test that is
considered to be developed so as to check the assumption that whether there has been
responsibility of the defendant for the claimant (Knapp, Crystal and Prince, 2019). This is
considered to be the case of liability for making the omission or for making any misstatement
which is considered to be causing any economic loss to the claimant.
It is seen that there is the duty of the party to the contract so as to perform the contract without
having any negligence for the same. Therefore this sic included that party to the contract has the
right to perform the activity with the due care. In the given case this is seen that George was in
hurry and he chop down the tree rushing so that the job can be finished in time. Hence due to this
he forgot to measure the estimated fallen height of the tree and made the negligence where one
tree was fall on the conservatory due to which huge loss was suffered to Jerry. Hence this is seen
that it is liability of George as he was considered to be negligent for this purpose so he is liable
so as to pay back the amount of loss that is incurred due to the negligence that has been provided

by the company. Therefore this can be said that jerry should be indemnified for the loss that has
occurred to him and court should give the decision so as to give him the reward for the loss that
has been caused by negligence of George.

3.
Identify the main business mediums available to Ringo and his friends John and Yoko and the
advantages and disadvantages of each of these mediums.
It is considered that there are various alternatives that are available to the business owners so as
to form the business. The government of the country has made various provision that includes
the formation of different style of business (Leng, and Wei, 2017). These are made in the way
that they are able to achieve the objective of maximising the performance and to gain the profits
based on it. this is seen that there are various forms of business structure options that are
available to them for the purpose of doing the business. This is seen that the government has
taken various steps through which they are able to provide different solution to the owners of the
business and to form the business which is considered to be best suitable for them. Hence this is
seen that there are various options that are considered for the issue which includes the following:
 Corporations: It is the type of business which is considered to be regulated by the
corporation act 2006. These are the most advantageous form of business organisation
which helps in making the business achieve profits as decided. For the formation of the
business this is seen that MOA and AOA is considered to be formed by the directors of
the company. The registration has to be done with the registration house. The company is
having perpetual succession which is considered to be one of the best advantage for the
business managers. For the formation of business this is seen that there must be at least 2
directors or this is seen that owners who will sign the MOA and AOA on their behalf so
as to form the business (McLean, 2019). In this there are various types of company which
includes the private limited company, public limited company and Government
Company. Therefore this is the one of the most important form of doing the business.
 Limited liability partnership: It is the partnership business where two or more than two
person come together so as to do the business to achieve profit. For the formation of the
partnership firm this is seen that the partnership deed is required to be formulated which
has to be made registered with the registrar of the firms. Here the partners of the
organisation enters into an agreement where they decide that they will share the profit as
per the decided terms and conditions. Here the liability of the partners is considered to be
limited and they are not liable to pay the amount that is due to them and the partnership

firm is liable so as to pay the amount through the assets which the business organisation
is having.
 Partnership: It is the type of business organisation which is considered to be similar to the
Limited liability partnership. But there is a difference in the amount of liability. It is seen
that the liability of the partners would be considered to be unlimited here and they would
be liable from their personal property for the dues that are not paid by the organisation.
Registration process is considered to be same in this case as in the case of the LLP.
This is seen that there are various advantages and disadvantages that are related to the different
types of organisation. These includes the following:
 Corporations: these are the firms that has the advantage of doing the expansion in any
part of the country with the same name. This organisation has the advantage of getting
the funds at the higher rate which is considered to be one of the most important advantage
for the expansion of the business (Oman, 2016). This is seen that the source of funding
includes the debentures, shareholders, bank loans etc. while on the other hand the
disadvantage includes the management is considered to be diluted and is not having the
power to take the decision on the basis of themselves. It is seen that for every decision the
shareholders meeting has to conduct.
 Limited liability partnership: It is considered to be the organisation that has the advantage
of having more management over the sole proprietorship business. This is seen that in
this type of business the liability of the partners is considered to be the limited. In this
form of business this is seen that the firm is having advantage of getting the funds
through various forms. While the disadvantage the firm is having includes that it does not
have the perpetual succession and hence they can be dissolved at any point of time.
 Partnership business: this is seen that the business is considered to be having similar
advantages as in the form of LLP business. This firm is also having the advantage of
having various source of funds as compared to the proprietorship firm business. While
the disadvantage the firm is having includes that the partners are having unlimited
liability (Poole, 2016).

4.
Discuss why it is important for Ringo, John and Yoko to identify the correct employment status
of any workers that they recruit for their business.
This is seen that for every business organisation it is considered to follow the employment law so
that they are considered to be not liable for the penalty that is imposed by the government on
them. This is considered that company must follow all the employment law so that they are able
to identify the employment status of the workers (Reimann and Zimmermann, 2019). This is
seen that it helps in protecting them from any loss that may occur due to noncompliance with the
laws. This is seen that organisations should consider and check the employment status of the
employee and should also check the fiduciary track record of the employee in the past. It is seen
that it is important for the company to check the background of the employee as if they are not
related or engaged in any unwanted activity in their past. It is seen that it is important for the
employer to form the contract with the employees as this would help in achieving the advantage
of defining the terms and condition that would be considered to be used in the case of any
dispute that arise in front of the employee of the company and the employer (Savelyev, 2017).

References
 Adriaanse, M.J., 2016. Construction contract law. Macmillan International Higher
Education.
 Beale, H., Fauvarque-Cosson, B., Rutgers, J. and Vogenauer, S., 2019. Cases, materials and
text on contract law. Bloomsbury Publishing.
 Cartwright, J., 2016. Contract law: An introduction to the English law of contract for the
civil lawyer. Bloomsbury Publishing.
 Huang, T. and Lan, L., 2016. On value re-creation and institutional innovation of the Labor
contract law. Science of Law (Journal of Northwest University of Political Science and
Law), (3), p.10.
 Hutchison, A., 2017. Decolonising South African contract law: an argument for synthesis.
In The Constitutional Dimension of Contract Law (pp. 151-184). Springer, Cham.
 Knapp, C.L., Crystal, N.M. and Prince, H.G., 2019. Problems in Contract Law: cases and
materials. Aspen Publishers.
 Leng, J. and Wei, S., 2017. The Evolution of Contract Law in China: Convergence in Law
But Divergence in Enforcement?.
 McLean, J.M., 2019. For a Law of Public Contract Per Se: An Intervention from Liberal
Contract Theory. Oxford Journal of Legal Studies.
 Oman, N., 2016. The Dignity of Commerce: Markets and the Moral Foundations of
Contract Law. University of Chicago Press.
 Poole, J., 2016. Textbook on contract law. Oxford University Press.
 Reimann, M. and Zimmermann, R. eds., 2019. The Oxford handbook of comparative law.
Oxford University Press.
 Savelyev, A., 2017. Contract law 2.0:‘Smart’contracts as the beginning of the end of classic
contract law. Information & Communications Technology Law, 26(2), pp.116-134.