Aspects of Contract Law Report

This report delves into various aspects of contract law, analyzing several case scenarios. It examines essential elements of a valid contract, including offer and acceptance, consideration, free consent, and capacity. Different contract types (face-to-face, written, distance selling) and their implications are discussed. The report also explores key contractual terms like conditions, warranties, and innominate terms, as well as exemption clauses. Furthermore, it compares and contrasts contract law with tort law, focusing on negligence and vicarious liability. Several case studies illustrate the application of these legal principles, covering topics such as agreement, consideration, exclusion clauses, implied terms, and the liability of care homes and employers. The conclusion emphasizes the importance of understanding and adhering to contract law principles for businesses.

ASPECTS
OF
CONTRACT

TABLE OF CONTENTS
INTRODUCTION...........................................................................................................................1
TASK 1............................................................................................................................................1
1.1................................................................................................................................................1
1.2................................................................................................................................................2
1.3................................................................................................................................................3
TASK 2............................................................................................................................................4
2.1................................................................................................................................................4
2.2................................................................................................................................................5
2.3................................................................................................................................................7
TASK 3............................................................................................................................................7
3.1................................................................................................................................................7
3.2................................................................................................................................................8
3.3................................................................................................................................................8
TASK 4............................................................................................................................................9
4.1................................................................................................................................................9
4.2................................................................................................................................................9
CONCLUSION..............................................................................................................................10
REFERENCES..............................................................................................................................11
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INTRODUCTION
Contract can be termed as the agreement made between two or more parties in order to
form a mutual relationship among each other. It is essential for firm to follow the legal obligation
appropriately so that desired results can be attained. The present study is based upon different
case scenarios that highlights upon the understanding of different essential elements present to
form a valid contract (Graham and Smith, 2006). From the study it can be assessed that there are
various components of the contract and thus it is essential for parties involved within the contract
needs to consider such elements. Furthermore, here, tort liability and liability in negligence needs
to be assessed through considering different case scenarios.
TASK 1
1.1
Contract can be termed as the legal agreement that is legally binding upon two parties
through mutual consent. It is usually refers as a written form but may be considered as either
spoken or implied (Gillies, 2005). In the given case, Peter Abraham decides to launch a new
business venture of building contractor and thus requires to obtain information regarding
formulating the contract. Following are the different components involved within the agreement
are as follows-
 Offer and acceptance- It is an essential element of valid contract which requires
legal 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 to
formulate valid and legal contract in which parties needs to agree upon terms and
conditions so that contract can be carried out legally. However, it is essential to
both the parties to agree to the offer made (BElliot and Quinn, 2009). The case
reference to “Harvey V Facey [1893] AC 552” has been done. Here, it can be
evaluated that one individual who is involved within the contract offers to sell his
pen to another individual and in lieu the offerer assesses that he would buy the
pen at £900.
 Legal consideration- Further, it can be stated that each and every contract needs
to be backed up by any type of consideration. Consideration can be regarded as
the term that is given something in return to support the promise or contract. It
can be in any form either money or things (Warren, 2013). Case reference is given
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of “Tweddle V Atkinson [1861] EWHC QBJ57”. Here, it assesses that individual
involved within contract requires to make the contract upon legal actions and they
are not able to claim the damages on another individual without undertaking any
consideration (MacMillan and Stone, 2009).
 Free consent- It is essential for parties to give free consent at the time of forming
contracts or agreements. Nevertheless, here, consent is not at all related to the free
consent 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 per
their own wish and thus the decision remains upon their own wish. It can be
evaluated that if Anna threatens Mary to beat her if she does not sell her her to
Anna. However, in such case, Mary does not sell her pen on free consent but
under coercion. Hence, the contract is not valid (Jennings, 2010).
 Capacity of parties- It assesses that both the offerer and offeree should be
capable enough to enter into contract. For instance, if individual is minor or
unsound mind at the time of entering into the agreement then they are restricted to
make any contract as per the legal actions (Jerrell, 2010). It can be assessed
through the case that the person who is minor i.e. Tom, borrowed £30 from Cathy
who is major. Hence, here Cathy will not be able to obtain the amount from Tom
as he is minor. Also, the agreement is not valid. It is because Tom is minor and he
is not able to make contract with any other party (Sadah, 2010).
1.2
In order to form a contract it involves different types i.e. face to face, written and distance
selling 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 the
basis of face to face interaction or orally. Here, both the parties are required to
agreed upon the terms of oral conversation so that agreement can be carried out
successfully (Rogers, 2005). However, it provides negative impact upon the
contract and thus it is because there are not written proof or documents available
in relation to the contract through which at the time of fraudulence action it can be
claimed in the court of law. Therefore, parties generally prefers to avoid such type
of contract as there is no legal obligation in oral contracts. For instance, in case of
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forgery, one party could not sue to other party and thus it impacts upon then
negatively because of unavailability of written proof and records that can be
needed because of evidence (Allen, 2011). Here, Peter Abraham is required to
undertake such contract by fulfilling the work within minimum time frame of the
overall contract.
 Written contract- Here, it is considered as the non verbal contract that involves
both the individuals who has signed the contract. Thus, such aspect provides both
negative and positive face of agreement. It evaluates that positive aspect evaluates
that the written proof as well as the disputes needs to be solved easily because of
valid contract (Chetwin, 2011). Further, negative aspect identifies that business is
not able to assess the crucial part of the contract and also not understand it
effectively. Here, Peter Abraham evaluates that similar formation of contract
which requires long term working reflection (Bailey, 2011). ESSO PETROLEUM
V MARDON [1976] QB 801
 Distance selling contract- It assesses that the contract is made through internet or
video conferencing etc. as both the parties are far away from each other. Hence, it
can provide negative impacts upon both the parties and harm them. It involves
different online agencies such as ebay, Amazon etc (Astrom, 2013). which adopts
distance selling strategy and impacts the party be selling different goods in terms
of characteristics or features as show in images over internet. Further, if Peter
Abraham chooses such method then it needs to form a website of his own through
which he is able to make communication and thus render the services to clients
(Adams, 2010).
1.3
Following arr the different terms in contract that possess different meaning and effect
which needs to be applied to the Peter Abraham such as-
 Conditions- Condition is an crucial component of contract and thus helps parties to
fulfill the contract easily. Further, if any of the party rejects the contract and claim
damages against the contract that will result into revoke of offer (Perritt, 2010). Thus, the
innocent party needs to carry out with the contract despite of the breach and recovers the
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damages occurred. However, it provides positive effect upon he livid party. As per the
case of “Poussard v Spiers [1876] 1 QBD 410”.
 Warranty- Warranty evaluates the term that is less significant within the contract and
thus consider that here honest party is not able to reject the contract but can demand for
compensation at the time of breach of warranty. For instance, it can be assessed that the
damages within the overall contractual terms must be dissolve in regard to the warranty
terms. “Bettini v Gye [1876] 1 QBD 183”.
 Innominate terms- It assesses that it is an intermediate terms in which either conditions
nor warranty is taken into consideration (Palmer, 2014). Such terms can be assessed that
it also effect upon the party and thus influence them to take certain actions. “The Mihalis
Angelos [1971] 1 QB 164”.
 Exemption clause- Here, It assesses that the agreement that helps in identifying the party
in order to set the limit to the contract and overcome the liability. Further, it can be
evaluated that certain unfair terms within the contract may cause disadvantage to the
party (Milner, 2011). However, it involves certain changes within law which assists in
providing more justice as well as limited usage of the clause. “British Crane Hire v
Ipswich Plant Hire [1974] QB 303”. It assesses that Peter Abraham possess certain
similar responsibilities of identifying relating to creating certain exclusion clause and
thus attain results.
TASK 2
2.1
CASE 1- Agreement
As per the provided case scenario, it has been identified that Carol is a student that is
living in unfurnished apartment. She saw a classified advertisement on online site for the sale of
brown coloured leather couch offered at £600 price. The advertisement was followed by picture
of product and contact information for the offering. Further, Carol showed her willingness to
purchase the product through email.
With respect to the aforementioned scenario, Coral has entered into a contract with the
provider of product. As per this, there is an offer provided by seller which is accepted by Coral at
the provided consideration. Therefore, the given situation meets all the necessary criteria of
contract (Middlemiss, 2011). The provide scene involve two parties the one giving the offer and
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other accepting the same at provided consideration. Further, for valid contract it is important to
have free consent. Therefore, the provided case shows there is no sign of fraud,
misrepresentation, coercion, undue interest etc. further, it is important for both seller and
customer to agree at same thing in same sense. Coral is provided with picture of product and
thereafter, it has provided consent to purchase the product. Therefore, in this case the customer is
free to purchase the product. Further, in accordance with the case of homas v. Thomas (1842) 2
QB 851, the court has declared that there must be express agreement and the conditions that
reflect appropriate legal consideration and independent consent of the parties to enter into the
agreement followed by lawful consideration. Therefore, it is valid contract.
CASE 2 – Consideration
Summing up the provided case study, it has been identified that Preston's son Devi was
searching a cyber- security job post in big IT company. Devi being a independent person wanted
no interference of its well recognized father. With the passage of time IT company decided to
appoint him and Devi accepted the offer. Preston is the father of Devi, unawared of the fact that
his son is appointed by company wrote a letter to George in IT company for giving £150,000
or other consideration if the organization would appoint his son. On the basis of this, George
and the organization decided to enforce this mail against Preston.
In accordance to above scenario, it is clearly evident that act done by Preston is not valid
an falls in the category of illegal act. It is act of bribery which is against the law. In addition to
this act, Preston is forcing George to appoint its son. Since, its inception that for a valid contract
it is important to have offer, a acceptance and lawful consideration. However, here there is no
lawful offer by company, acceptance of the offer by George and legal consideration or lawful
objective (CMcKendrick, 2014). Further, the interest of party is also not to enter into legal
relationship. Hence, as per the verdicts of court in case Re McArdle (1951), it has been identified
that a promise is unenforceable in he case when task is completed before the promise is done.
Hence, it is past consideration and Preston is not liable for payment of £ 50,000 to George or
company.
2.2
CASE-3- Exclusion Clause
From the scenario it has been identified that a could booked a table at a recognized
restaurant in London. While, entering into the restaurant, he gives his coat to the porter. The coat
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contained his wallet with £ 500. thereafter, a receipt was provided to customer containing
exclusion clause that all the valuable items must be removed from the pocket of jacket and the it
will not be liable for any missing or stolen items. Later, man realize that its wallet is missing and
finding the coat he identified that there was no money in the wallet. On asking the recovery
amount, restaurant refused showing the exclusion clause that they are excluded from such
liability.
From the above scenario, it can be stated that restaurant is liable to provide refund to
customer. This is because, clause stated on the back of receipt is not valid and is not part of
exclusion clause. The main reason for this is responsibility of restaurant, to inform customer
about such exclusion clause. Since, the customer was not aware of it, restaurant is liable to
refund money to him. Also, in the case of Chappleton v. Barry UDC [1940] 1 KB 531, it has
been ascertained that ticket is just a decrepit which does not fall in lawful category. The
objective of this, is to support the evidence that customer has paid for the service and determine
the user how long the ticket is valid and can be used (Mahamid, 2012). Therefore, in accordance
with 1977, unfair contract terms act, the restaurant is liable to pay refund or damages to
customer.
CASE 4 – Implied term
In accordance with the provided case scenario, Aaron has rented a warehouse which is
not in use for long time and demands repair. The proprietor of house lives in Zehphra. Aaron
made viable modifications in warehouse on a promise that rent will not be increased for the next
5 years. However, after a year the owner died and the value of the property enhanced in the value
partly due for renovations done by Aaron. The legal hire of Zehpra, Yeti enhanced the rent
which was not accepted by Aaron due to promise done by owner to not increase the rent.
Therefore, Yeti terminated the tenancy and Aaron claimed for compensation to recover the
expenditure done by it on repairs. Further, the claim for compensation was rejected on the
grounds of no agreement claiming about the expenses.
Here, Aaron is authorized to claim compensation for the expenses incurred by him.
Further, Yeti cant add the rent because it was promised by Zehphra that she would not enhance
rent for 5 years. Therefore, the right is not available to Yeti to revoke the agreement under
section 6, Unfair contract terms act 1977). Also in the case of Hutton v. Warren [1836], the
court stated that implied term into a tenancy is valid for damages it it is done for the
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improvement etc. therefore, it is implied contract and Aaron can claim for compensation
(Liming, 2010).
2.3
CASE 5
In this case a individual applied for motor insurance. The proposal form have a clause asking
that, was individual is part of motor accident or made a claim in last 5 years. In this respect, the
individual answered No. Later, the policy holder car was stolen and on enquiry it was identified
by insurer that a theft claim was made previously within the five year time frame. On the basis of
this, claim and policy was rejected from beginning. For this, it was reasoned by policy holder
that disclosure was not made as he thought it had no relation with insurer.
In the aforementioned scenario, the policy holder is at fault as he furnished wrong
information to the insurer. This is also regarded as breach of the terms of insurance contract. It
was duty of policy holder to give right information and disclose the previous claim made by him.
therefore, insurer is authorized to reject the claim of policy holder and terminate the policy from
the beginning on the grounds of false information received by other party (Grigoleit, 2011).
TASK 3
3.1
There are wide range of difference and similarity between tort law and contract law.
Some of them are discussed as follows:
Similarities
 Both of the aspect, tort and contract law are civil wrong.
 The handle the cases where duties are breached by the party.
 In both the law,the applicant taking action against plaintiff, is required to prove its point
with the help of evidence ( Introduction to Tort Law. 2012).
 The sufferer is liable to claim for compensation in terms of remedies . No other
punishment will be provided (DiMatteo, 2012). The both the laws are based on the fact that he fundamental rights of a person must not be
breached.
Dissimilarity
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 Relationship between the parties: In tort law, the parties does not have any contractual
relationship among them. While, in contract law, there is contractual terms between the
parties.
 Type of obligation: As per the contract law the parties are required to perform their
operations as per the terms of contract. On the other hand, in tort law the plaintiff is
needed to act as per the fundamental principles of care (Graham and Smith, 2006).
Case: From the case of Honcock v. Northcut (1991), it was identified that contractual parties
are required to perform their functions in accordance with the laid down conditions. In case of
breach of terms, the entire contract will be terminated. The case of Donoghue v. Stevenson
(1932) in was claimed that in tort law each individual is required to act in accordance with the
duty of care to other party (Milner, 2011).
3.2
Negligence is act where one of the part fails to exercise the care that is moderately a wise
person is required to exercise in such circumstances. The tort law is also recognized as
negligence as the harm is caused to party due to carelessness and not on intentional grounds.
Further, negligence is civil wrong in which the party of contract fail to execute its duty in best
way resulting into harm to guiltless party (Gillies, 2005). Therefore, in order to prove negligence,
the claimant is required to fulfil following conditions:
 Duty of Care: As per this, the applicant is needed to have proper consideration on
various aspect of contract so as to maintain the interest of other party. In this respect,
necessary actions must be taken by them to safeguard the interest of other party (Rogers,
2005).
 Breach of Duty: This condition state that plaintiff fails to meet its duty by not taking
proper consideration and resulting into loss for other party.
 Causation: As per this condition, applicant is required to prove that he/she has suffered
loss due to negligence of defendant party.
 Foreseeability: This means that conditions that must be proved successfully for claiming
under negligence act is termed as foreseeability (Sadah, 2010). Therefore, the damage
must be caused due to negligent act of the responsible party part of the contract.
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3.3
Vicarious liability can be stated as the act in which the party is held liable for the actions
of another individual. According to the doctrine it assesses that the actions are imposed upon
individual in regard of failure of the contract and thus it is essential to have a best bond. For
example, in a company the employer is held responsible for the actions or mistake done on the
part of its employees , catered to the fact that this took place in he course of their employment.
Therefore, employer must ensure that acts of employee are not contradictory to laws. Further, in
the case of Lister v Hesley Hall Ltd. [2001] it was identified that employer is accountable for the
civil wrong done by the organizational members at the workplace. In the given case, it was
ascertained that organizational members were indulged into sexual activities with each other at
office premises during employment period. Hence, employer is responsible for the neglect and
erroneous acts done by the employees (Palmer, 2014).
TASK 4
4.1
Case 7
It can be assessed from the case that Mr. Brown was not feeling well and thus complaints
regarding chest pain and breathing issue. Later he visited to Goodmayes hospital and he was
checked by the nurse in the absence of doctor. However, nurse telephoned doctor on duty and
asked to prescribe some counter pain killers. Next day Mr. Brown died from pneumonia that is
occurred due to toxic mould in his house. Following are the components of negligence of tort
that can be for or against the care home responsibility such as-
 Care home being held responsible for negligence- Here, the widower of Mr. Brown
demands for compensation or is liable to sue the hospital for their careless attitude. It is
because the doctor on duty was not present and thus the nurse prescribed the medicine
that shows the negligent behaviour of doctors as well as care home towards patients
(CMcKendrick, 2014). It is because without proper check up of patients they are
prescribing the pain killers which is illegal. While, another reason might be expiry of the
medicine given to Mr. Brown that results into his death.
 Care setting should not be held responsible for negligence- Here, it assesses that here
doctor and nurse is held responsible the action of negligence. It can be occurred when the
death of Mr. Brown has taken place at his home, hence the nurse is not presence and does
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not play any role within it. Hence, widower of Mr. Brown could not state that care home
is liable for the death of patient due to toxic mould (Milner, 2011).
4.2
Case 8
Here, it can be assessed from the case that an executive chauffeur business sends its
driver to pick up a client from airport. However, while waiting for the flight to arrive at the
airport as it was delayed, he drinks alcohol. Later, at the time of driving the vehicle to the client's
hotel, the driver crashes the care into a lamp post and hurts the client with serious injury. Further,
client decided to sue the chauffeur company (Middlemiss, 2011). Thus, the client possess the
ability to sue the firm as they are in legal relationship because of employee-employer. And it is
the responsibility of the firm to direct its employees regarding their roles and responsibilities
while at work. Due to negligence of driver it affects the clients and thus he is eligible to claim for
damages from the company. However, here the driver is also responsible for the act and thus
requires to pay for damages because he should not drink when he was on the job.
Case 9
Here, Mr. Jones assesses that when he was loading the pallets into his trucks, he slipped
on the gate through which pallets also fell and harmed the other individual. However, the injury
was much severe that the colleague requires an urgent surgery and few months of relaxation. The
colleague is also planning to sue the supermarket because of their carelessness he suffered from
such injury (Astrom, 2013). While, supermarket argues that it is not their responsibility as health
and safety of workers has been shifted to another firm. But, it is the responsibility of the
supermarket to take into certain conditions and thus actions towards the other firm who take care
of the health and safety at business.
CONCLUSION
It can be concluded from the study that contract is also enforceable under law and thus
businesses are complied to follow such legal actions in order to not affect the operations of firm.
Thus, legal contract is made under the eyes of law that needs to identify the clauses effectively
which needs to be followed properly so that contract can be accomplished easily. Further,
conditions are set within the agreement and thus the parties involved within the contract needs to
be informed them about the legal duties applied within the contract that requires to be fulfilled.
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