Legal Assessment: Contractual Issues of Sid and Dancing Club Pty Ltd

This assignment provides legal advice regarding a contract law scenario involving Sid and Ned's Dancing Club Pty Ltd. It addresses whether Sid is bound by the club's membership contract, the club's obligations, the validity of altering access hours, Sid's entitlement to free dance shoes, and the impact of Sid not reading the contract terms. The analysis applies principles of offer, acceptance, capacity, invitation to treat, consideration, collateral contracts, and unconscionable contracts. It concludes that Sid is bound by the contract due to signing the membership form with a whole agreement clause, is not entitled to free shoes as it was an invitation to treat, and would have been in a different legal position had he reviewed the terms beforehand. The document is contributed by a student and available on Desklib, which provides various study tools for students.

RUNNING HEAD: CONTRACT LAW
Contract Law
Name of the student
Name of the university
Author Note

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RE: LEGAL ADVICE ON LAW OF CONTRACT
Dear Sid,
According to your request, I am drafting this letter for providing you a well explained
lawful suggestion about the contract law.
The first concern regarding the provided case is whether Sid is bound by the contract of
membership with the organisation Dancing Club Pty Ltd.
The second concern regarding the provided is whether the Club is bound by the contract
of membership with Sid.
The third concern regarding the provided case is whether the contract of membership
provides the right to alter the access hours of the Club without any prior notice.
The fourth concern regarding the provided case is whether Sid is entitled to receive a pair
of free dance shoes
The fifth concern regarding the provided case is whether the fees stated for the
membership forms a contract of membership.
The sixth concern regarding the provided case is whether Sid would have experienced a
different situation if he would have read the terms and conditions of the membership contract
before signing it.
Rule of the Law:
A legal agreement can be said to be valid if an offer is produced by an offeror and the
produced offer should be accepted by an individual who produced the offer. The essential

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elements of the contract should be present in an agreement produced by the offeror. The case
study of Carlill vs Carbolic Smoke Ball Co1 can be suggested as a matter of reference.
The main necessary elements for creating a valid agreement is that there should be the
presence of an offer in the contract and that given offer should be accepted by the individual to
whom the offer is produced. Such a type of contractual agreement is essential to be conveyed,
and the actual focus should be pointed for developing a lawful connection between the
contractual parties that will enhance in developing a contract along with the conditions and terms
of the contract. This statement can be supported by the case study of Smith vs Hughes (1871)2.
The main necessary elements of a valid contract are as follows:
Offer:
The main element for creating a valid lawful contract is an offer. In an agreement the presence of
an offer or a promise is must. The contract or the agreement will be invalid if there will be
absence of an offer. The essential element of a contract is considered as the offer. It is considered
as the essential elements of a valid contract as it clears out whether the agreement is legally valid
or it can be legally acceptable or not. In a document of a contract it is essential that a party
should produce an offer3. There is a basic difference between an advertisement and an offer. For
developing a valid agreement there should be two parties, or more than two parties and the
contractual parties should be legally capable of entering into valid contract. When an offer is
accepted it can be said as an agreement that leads to a creation of unlawfully valid contract.
1 Carlill vs Carbolic Smoke Ball Co QB 256; (1891-4) All ER Rep 127
2 Smith vs Hughes (1871)LR 6 QB 597
3 Peden, E., 2001. Incorporating terms of good faith in contract law in Australia. Sydney L. Rev., 23, p.222.

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When an opposite party is provided with an offer that particular person or an individual should
have a positive idea of outcome of the made offer in case the offer is being accepted by the
opposite parties of the contract or the agreement. For example a family decided to go for a tour
with a travel agency during their holidays for a trip to Hong Kong. The family created a contract
with the tourist company by filling up an informative form where it has been observed that they
accepted the conditions and terms by signing off the agreement. This specific sign in the
document of the contract makes it clear to the tourist company that the family has agreed to the
rules and regulations specified in the document of the contrac4t. In this situation it can be well
understood that the family has entered into a valid contract with the tourist company.
Acceptance:
When an offer is present in an agreement, there should also be an acceptance to that produced
offer. When a document of the contract is made there should be an acceptance from the opposite
party of the contract or the agreement. When the terms and condition of the contract is clear to
the opposite party of the contract the produced offer should be accepted as the offer along with
the terms and condition of the offer is clear to the contractual parties. The rule of the contract or
the contractual document should also be clear to both the parties of the contract (Drahos and
Parker 1990). A legal agreement cannot be said to be valid if the parties of the contract continue
to negotiate or discuss, no provision can be considered for acceptance of that offer as the
agreement will not be valid. The parties in a contract should accept an offer either in writing or
orally where the content or the terms of the contract is being created verbally or should be
spoken out.
4 Cartwright, J., 2016. Contract law: An introduction to the English law of contract for the civil lawyer. Bloomsbury Publishing.

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Capacity:
The term ‘capacity’ is also one of the important elements of an agreement where the parties of
the contract should carry a legal capacity for entering in the particular contract. The parties of the
contract should be above the eighteen years of age which can be stated as the age of major as per
the law of contract5. Those who are below the eighteen years of age can be stated as minor as
they are incapable of entering into a legal contract. For example a person under the eighteen
years of age cannot be accommodated in a hotel. The staff of the hotel authority will not permit a
particular person to stay at that specific hotel which has not met the minimum criteria of eighteen
years of age or more than that. In this situation minors can stay in a hotel where he or she should
have guardian who will more than eighteen years of age or a proper parent who will be
accompanying the minor or a proper parent for getting an accommodation in that particular hotel
or lodging house.
Invitation to treat:
The term law of contract explains the distinction between a merchandise or advertisement
displays from a formal offer of contract. In case of an offer, it is exposed to the offeror of the
contract or agreement, and if that specific offer is being accepted then it becomes a formal
contract, but in case of an invitation to treat it does not form any contract with the opposite party.
Any offer that is being produced should be unequivocal, clear and it should also be direct
approach to the opposite party of the contract. This is the reason the catalogues, advertisement or
the flyers by the stores cannot be considered as the formal offer. A term invitation to treat can be
considered as the mere announcement to the public that an individual is ready to provide an offer
in exchange for some service or certain thing.
5 Drahos, P. and Parker, S., 1990. Critical contract law in Australia. J Contract Law, 3(1), pp.30-49

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Consideration:
The essentials of a valid contract are as follows:
 Their consideration should be real
 The consideration may be in the present, past and future
 There should a promise or an individual
 There should be promisor’s desire
The consideration is a type of benefit that can be bargained between the contractual parties, and
it is considered as the necessary reason for the contractual parties for entering into the
agreement6. There should be a value in consideration that can be received in exchange of service
or performance. Ilegal acts or immoral acts they are performed against the policy of the public
cannot be served as consideration for the contract that are enforceable.
Formation Collateral Contract:
A statement made orally can be considered as binding in case it is not found to be a term of a
contract that is written, where it can be seen that the collateral contract arises. If one of the party
in an agreement declares that he or she will sign the written agreement if he or she is sure that it
can be construed in a way that is certain, there will be two contracts that will be emerging the
collateral contract and the written agreement that is based on the statement that is given orally7.
6 McKendrick, E., 2014. Contract law: text, cases, and materials. Oxford University Press (UK).
7 Turner, C., 2014. Unlocking contract law. Routledge.

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This can be supported by the case study of Heilbut Symons & Co v Buckleton (1913) AC 30 at
478. Another case study of City and Westminister Properties Ltd v Mudd (1959)9.
Unconscionable Contract:
A contract that is considered to be unconscionable is the one that has been observed to be one-
sided that for one party and unenforceable under the law. It is seen to be a type of contract where
one of the party is seen to be left with no meaningful choice, real, due to the major distinction in
the power of bargaining between the contractual parties10. In a specific lawsuit if it is found by
the court that the contract is unconscionable, in this situation the court will declare that contract
to be void. No specific performance or no damages award will be given or will be issued against
them, and the parties will be easily released from all the obligations of the contract. An
unconscionable contract is based on three different factors like undue influence, duress, unfair
surprise, limited warranty and the unequal power of the bargaining11.
Application:
In the given scenario it has been observed that Sid has expressed interest for the services
as offered by Ned’s Dancing club Pty Ltd, it is also seen that as he has signed the membership
form of the club agreeing to the terms and conditions of the membership contract. In this
situation, it is well understood that Sid is bound by the membership contract with the Dancing
Club Pty Ltd. At the same time it has been observed that the club is also bound by the
8 Heilbut Symons & Co v Buckleton (1913) AC 30 at 47
9 Westminister Properties Ltd v Mudd (1959)
10 Andrews, N., 2015. Contract law. Cambridge University Press
11 Smits, J.M. ed., 2017. Contract law: a comparative introduction. Edward Elgar Publishing.

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membership contract with Sid. There is a basic difference between an advertisement and an
offer. For developing a valid agreement there should be two parties, or more than two parties and
the contractual parties should be legally capable of entering into valid contract.
In the provided case it has been observed that the contract Sid has signed includes a
whole agreement clause. Therefore whatever changes that the company may implement that does
not favor the client, the client is bound by the mentioned terms and condition in the contract. As
a result, the company changed its opening hours from 24 hours to some specific days. The
changes in the time schedule that the company has made will not be suitable for Sid, but
according to the term and condition of the membership contract, Sid will not get any refund due
to the ‘whole agreement clause.
In the provided case it has been seen that Sid is not entitled to receive a pair of free dance
shoes as it was an invitation to treat. Any offer that is being produced should be unequivocal,
clear and it should also be direct approach to the opposite party of the contract. This is the reason
the catalogues, advertisement or the flyers by the stores cannot be considered as the formal offer.
An term invitation to treat can be considered as the mere announcement to the public that an
individual is ready to provide an offer in exchange of some service or certain thing.
In the given scenario it has observed that the legal position would have been something
different if Sid would have read the terms and conditions of the membership contract before
signing off the contract or the agreement provided by the club. When the terms and condition of
the contract is clear to the opposite party of the contract the produced offer should be accepted as
the offer along with the terms and condition of the offer is clear to the contractual parties. The
rule of the contract or the contractual document should also be clear to the both the parties of the

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contract. A legal agreement cannot be said to be valid if the parties of the contract continues to
negotiate or discuss, no provision can be considered for acceptance of that offer as the agreement
will not be valid.
Conclusion:
It has been concluded about the first concern that Sid is bound by the contract of
membership with the organization Dancing Club Pty Ltd.
It has been observed about the second concern that the Club is bound by the contract of
membership with Sid.
It has been concluded about the third concern that the contract of membership provides
the right to alter the access hours of the Club without any prior notice.
It has been observed about the fourth concern that Sid is not entitled to receive a pair of
free dance shoes.
It has been concluded about the fifth concern the fees stated for the membership forms a
contract of membership.
It has been observed about the sixth concern Sid would have experience a different
situation if he would have read the terms and conditions of the membership contract before
signing it.

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Reference:
Carlill vs Carbolic Smoke Ball Co QB 256; (1891-4) All ER Rep 127
Smith vs Hughes (1871)LR 6 QB 597
Heilbut Symons & Co v Buckleton (1913) AC 30 at 47
Westminister Properties Ltd v Mudd (1959)
Peden, E., 2001. Incorporating terms of good faith in contract law in Australia. Sydney L.
Rev., 23, p.222.
Drahos, P. and Parker, S., 1990. Critical contract law in Australia. J Contract Law, 3(1), pp.30-
49.
Cartwright, J., 2016. Contract law: An introduction to the English law of contract for the civil lawyer.
Bloomsbury Publishing.
McKendrick, E., 2014. Contract law: text, cases, and materials. Oxford University Press (UK).
Poole, J., 2014. Casebook on contract law. Oxford University Press, USA.
Andrews, N., 2015. Contract law. Cambridge University Press.
Smits, J.M. ed., 2017. Contract law: a comparative introduction. Edward Elgar Publishing.
Turner, C., 2014. Unlocking contract law. Routledge.

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