Detailed Report on Aspects of Contract Law and Negligence

This report provides a comprehensive overview of contract law and negligence, beginning with the essential elements of a valid contract, such as offer, acceptance, intention to create legal relations, consideration, and privity. It explores the impact of different types of contracts, including unilateral, bilateral, and collateral contracts, and discusses various terms affecting contracts, such as express, implied, and in nominate terms. The report then examines contract elements in specific business scenarios, the laws governing terms in different contracts, and the effects of these terms. Furthermore, it contrasts liability in tort with contractual liability, explains the nature of liability in negligence, and clarifies how a business can be vicariously liable. Finally, the report applies the elements of the tort of negligence, vicarious liability, and available defenses in various business situations, providing a thorough understanding of these legal concepts. Desklib offers a range of resources, including past papers and solved assignments, to support students in their studies.

ASPECTS OF CONTRACT
AND NEGLIGENCE
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Table of Contents
Introduction................................................................................................................................3
Task1..........................................................................................................................................3
1.1 Essential elements of valid contract............................................................................3
1.2 Impact of different types of contract...........................................................................5
1.3 Various type of terms affecting the contract...............................................................6
Task 2.........................................................................................................................................7
2.1 Elements of contract in given business scenarios.......................................................7
2.2 Law on terms in different contracts............................................................................8
2.3 Effect of different terms in given contracts................................................................8
3.1 Contrast liability in tort with contractual liability.......................................................9
3.2 Nature of liability in negligence...............................................................................10
3.3 How a business can be vicariously liable.................................................................11
Task 4.......................................................................................................................................12
4.1, 4.2 apply the elements of the tort of negligence, vicarious liability and defences in
different business situation.............................................................................................12
Conclusions..............................................................................................................................13
References..................................................................................................................................1
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INTRODUCTION
A contract is a valid agreement between two or more persons or entities. A contract will
be considered as legal agreement only when two essential elements are present (i.e. offer and
acceptance). Moreover, this report interprets various essential elements required for the
formation of a valid contract. In this various type of contracts are also discussed. Various
type of terms are also discussed which in turn affect the contract. In this report liability in tort
is explained. Moreover, various elements of the tort of negligence are also discussed.
TASK1
1.1 Essential elements of valid contract.
According to law all contracts are agreements but all agreements are not contracts. All
agreements are contract only when they are made up of free consent, competent to contract,
lawful consideration and so on and is not expressly declared to be void (Beever, 2007).
Therefore some of the essential elements of valid contract are as follows:-
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1.1 Meaning Case study
Offer
An offer is the act of offering
something to another in an aim to
sell it or to take something in
return. Moreover, it can be said
that offer + acceptance=
agreement.
Carlill v Carbolic Smoke Ball Co [1893] 1
QB 256 Court of Appeal. According to the
case Carbolic Smoke Ball Co. made an
offer in a newspaper to reward £100 to the
person who caught influenza from using the
balls three times a day. But there was no
acceptance. Therefore, offeror (Mrs. Carlill)
must show in advance his intention to
accept the offer.
Acceptanc
e
It is the process of accepting
something offered by the offering
in order to purchase the thing or to
given something in return.
Butler Machine tool v Ex-cell_O
Corporation [1979] 1 WLR 401 Court of
Appeal. According to the case Ex-Cell-O
want to purchase a machine from Butler
after 10 months. In lieu of which Butler
send him a price quotation with a copy of
sales terms. Ex-Cell-O mentioned in the
agreement that any variation in the price
will not be accepted. Order will be placed at
£75,535 only. In lieu of which Butler
signed an agreement accepting all the terms
mentioned by the Ex-Cell-O.
Therefore, the contract is the valid contract.
Butler demand to pay extra £2893 is not
valid.
Intention
to create
legal
relations:
For creating a lawful agreement
there must be an intention among
the parties to create legal relations
(Caruso, 2007). An agreement of
social and domestic nature does
not form a legal contract.
Jones v Padavatton [1969] 1 WLR 328.
According to the above case, mother
promised to pay $200 per month to her
daughter if she leaves her job but daughter
did not accept. Later on, mother purchased
a house for her daughter for studies. But
due to some reasons daughter got married
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and was not able to complete its studies.
Later on daughter claim for a house which
was not valid. Therefore, it can be said that
it is a domestic agreement between mother
and daughter not a legal agreement.
Considerat
ion
Consideration is something which
creates value in the eye of law. It
does not include promise of love,
gifts etc.
Lampleigh v braithwaite [1615] EWHC KB
J17. According to the case the promise
made by the defendant was a valid promise.
The defendant was duty-bound to pay £100
to the claimant once he able to achieve
forgiveness from the king.
Privity of
contract
It is a relationship that exists
between parties to an agreement.
The doctrine of privity says that
only those parties are in
conditions that can impose rights
and obligation who are the part of
the contract.
Therefore, these are some of the essential elements of the contract which are
necessary for the formation of the valid contract. If any of these elements are not used
properly than contract can became void.
1.2 Impact of different types of contract.
There are various types of contract available. Some of them are valid contract whereas
some are void (Klove, 2005). Therefore, types of contracts are discussed on the basis of its
formation, nature, executive and validity.
Unilateral contract: - Unilateral contract is the contract in which only one party make the
promise to perform a particular task. This type of contract is known as one-sided type of
contract.
Carlill v Carbolic Smoke ball Co 1893: According to the case company placed an
advertisement that whoever uses this medicine and get flu will be awarded £100. Therefore,
as per the advertisement this offer is not defined contract until Mrs. Carlill used the medicine
and get flu. Once the flu is hitted than company will be bound by their offer.
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Impact: - Unilateral contract are the contract which cannot be renege at any time.
Therefore, in this case offer can be renege once offered has start implementing it.
Bilateral Contract: - Bilateral contract is the exchange of mutual and correlative
promise between parties that entails the performance of an act.
Butler Machine tool v Ex-cell_O Corporation [1979]: According to the case Ex-
Cell-O send an agreement to the Butler for the purchase of a machine which cost £75,535 at
the time of the agreement. The agreement also includes the clause that if prices changes after
10 months than also Ex-Cell-O will purchase the machinery at the same rate. But without
reading the agreement Butler simply signed which has shown that he has accepted the offer.
Moreover, the written contract is valid contract.
Impact: The faulty party is going to be liable towards contract once offer and acceptance has
been made.
Collateral Contract: - Collateral Contract is the addition contract prepared by the
original parties in order to overcome the drawbacks of the original contract.
Shankinlin Pier Ltd v Detel Products 1951: According to the case study Shankinlin
Pier Ltd. bought paint from Detel products. In this case, at time of contract defendant gives
guarantee to the claimant but claimant has already made contract with other person in order
to use its paint for support.
Therefore, according to privity of contract rules no contract is formed between
Shankinlin and Detel. Because Detel has not sold any paint to the Shankinlin. But according
to the court collateral contract is formed between two parties. Therefore, Shankinlin can sue
Detel against breach of collateral contract.
Impact: There must be a promise between two parities. If no promise is made than collateral
Contract will be undefined.
1.3 Various type of terms affecting the contract.
 Express terms: - These are the terms that are express and are included in the contract
at the time of its formation. The express term is a contract of employment that can be
expressed orally or in written between two parties. In other words, it can be said that it
is a term expressed orally or in written depending upon the nature of the contract.
These terms are included with the mutual and correlative understanding among both
the parties. These terms can be cancel by the parties at the time of formation of the
contract if they does not like it.
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According to the case of Poussard v Spiers [1876] 1 QBD 410, innocent party can reject
the whole contract if the performance of the party is satisfied. Therefore, if warranties are not
satisfied than in that case claimant can ask for the damage caused.
 Implied terms: - Implied term refers to the practice of setting defaults rules for the
contract. In simple words, it can be that these are the terms in a contract that are not
expressed in the contract but are included in the body of the contract (Lipshaw, 2011).
The terms included in the contract are sales and supply of goods. These terms are not
directly express in oral or written form at the time of formation of a contract. These
terms are simply introduced by the court in order to give personal effects to the goal
of the entities.
According to the case of Hutton v Warren [1836] EWHC Exch J61, if any implied
term are not satisfied than in that case that contract is said to be void from the beginning.
 In nominate terms: - In nominate terms are the terms that cannot defined as neither a
'condition' nor ‘warranty’. In nominate terms are also known as intermediate terms.
This is the contractual terms in which injury of the innocent party is identified in
terms of condition and warranties. If any individual breach the condition than in that
case innocent party is liable to claim the compensation and in respect to which can
also cancel the contract. Similarly, in case of breach of warranties innocent party can
claim for a compensation but cannot cancel the contract.
TASK 2
2.1 Elements of contract in given business scenarios.
In the given scenarios it is seen that Ivan goes into bookshop to purchase HND business
book which he want to buy it for £50. Ivan went to the counter to purchase the book from
Todor (owner of the book shop) but Todor refuse to sale him the book. He told him I have
sold out his book to Carl. Todor simply said that I just forget to remove this book from the
display. After taking into consideration, it can be seen that Ivan offer book to Todor, but
Todor does not accept it. Therefore, it can be said that offer is there but there is no
acceptance. Moreover, contract is said to be valid only when there is offer and acceptance
both (Olander, 2012). If any one of the element is missing than in that case a valid contract
cannot be formed. For example- offer+ acceptance = contract.
 Invitation offer:- In this case offer was there . HND business book offers various
types of books to its customers for the purchase.
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 Written contract:- there was no written contract was made between Todor and Ivan
in order to purchase the book liked by the Ivan.
 Acceptance: - in the above case acceptance was there from the side of Ivan for the
book which was not offered by the Todor.
 Expressed term:-In this case there was no expressed term. Because both the parties
are not agreed upon the same thing.
 Condition: - Condition is a term which is going towards the root of the contract.
Therefore, in this case there is no condition.
2.2 Law on terms in different contracts.
The following case study say that Adam has advertises in a newspaper to reward £1000 to
a first person who swims from Dover to Calais. Brain after seeing this add started swimming
from Dover to Calais. But before Brain reaches to Calais Adam again placed an
advertisement in a newspaper that he is withdraw his announcement of reward. But Brain was
unknowingly completed the game. Therefore, Brain claims his reward but Adam refuses to
pay. Moreover, from the above case it can be conclude that it is a type of unilateral contract
(Robertson, 2013). Unilateral contract is the contract in which offer and acceptance is there
but without their mutual concern. Therefore, Adam is obliged to pay Brain a sum of
compensation. Because Adam offer and Brain accepts but without any mutual concern.
 Condition: - In the above case it can be said that 'condition' exist. Condition is a term
which is going towards the legal obligation.
 Express term: - -In this case there was no expressed term. Because both the parties
are not agreed upon the same thing.
 Offer: - According to the above case it can be said that there was an offer made from
the side of Adam.
 Acceptance: - According to the above case study there was an acceptance from the
side of Brain. But in order to form a legal contract between both of them than in that
case offerer must show in advance his intention to accept the offer.
 Legal intention: - Adam did not have any legal intention to cheat the Brain.
 Unilateral contract: - According to the above case, it can be said that there was a
unilateral contract between the two. Unilateral contract are the contract in which offer
and acceptance is there but without mutual concern.
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2.3 Effect of different terms in given contracts.
On the basis of the above case study it has been found that Barry went to a park where he
saw a notice on display were it was written that chairs are on hire for 50p. In respect to which
Barry went to the local council in order to hire the chair. He pays 50p to council and took the
ticket. But after sometime went Barry set on the chair the chair collapse and he was badly
injured and his clothes were damage. In lieu of which he went to the local council were he
claim for a sum of compensation for the damage caused to him? But the authority of local
council refuse to pay because at the back side of the ticket an exclusion clause was mentioned
which states that “No liabilities is accepted for the damage or injury caused due to the
collapse of the hire chair”.
Thus, in respect to which it can be said that a contract has been formed between
Barry and local council because offer and acceptance has been made. In addition to this it can
also be concluded that it is the case of express term where a contract has been made with
mutual trust and understand. Therefore, it can be said that Barry is not liable to claim for a
compensation for the damage caused to him.
 Written or Bilateral contract:-According to the above case there was no bilateral
contract was made between the two parties.
 Condition: - in this case no legal condition arises between the two parties.
 Express term: - As per the above case it can be said that it is the contract of express
term between both of them. Express term is a term in which both parties have mutual
concern on a particular decision (Scott, 2006).
 Exclusion clause: - On the basis of the above case condition of Exclusion clause
arise. Because Exclusion clause is the clause which is written down on the contract
which say that party who has made contract is not responsible for certain happenings.
Task 3
3.1 Contrast liability in tort with contractual liability.
S.n
o
Basis Liability in negligence Contractual liability
1 Mansfield v
Weetabix [1997]
CANature of
In case of liability in negligence
individual need to act according
to the standards of expected care
In case of contractual
liability parities need to
follow terms of the contract.
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obligations and reasonable professional.
2 Relationship between
the parties
In this relationship is not created
by mutual consent. It is simply
imposed by the law. It is a type of
non- contractual liability.
In this relationship is
created and managed by the
contract. In this parties enter
into relation with mutual
consent.
3 Aim It aim is to compensate the
applicant by putting them in a
position where negligence has not
taken place.
It aim is to compensate the
applicant by putting them in
a position where contract
had been performed.
4 Reduction of damage Damages are reduced by relevant
amount of percentage when
claimant's conduct contribution to
loss. Compensation is awarded to
the victim for their loss.
Damages are reduced by the
amount satisfied if the
claimant's fails to claim.
5 Case studies Chester v Afshar [2005]. The
following case study says that the
defendant has warned claimant in
advance that there is the risk of
developing syndrome after the
operation takes place. After
knowing this claimant was ready
for the operation. Therefore, when
operation takes places claimant
has developed the syndrome. In
lieu of which claimant files a case
in the court against the defendant.
Therefore, it can be said that it is
a case of liability in negligence.
According to the judge it was the
mistake of the claimant. Claimant
should consult to some other
Mansfield v Weetabix
[1997] CA. The following
case study says that the
driver (owner of the lorry)
suffers from the lack of
glucose in the brain. Drive
of D was unaware about the
effects of this on this
driving. He damages the C
shop when he left the lorry
on turn. Therefore,
according to law the driver
was not liable to pay any
compensation because he
was unaware about the
illness. Thus, his actions do
not fall under the standard
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surgeon before surgery in order to
find out another best solution. But
according to the law defendant
was held liable for the damages
caused because he has not
informed to the claimant when the
risk of developing syndrome
starts.
of care required. Therefore,
at last C lost the case.
3.2 Nature of liability in negligence.
Liability in negligence:-Negligence can be said as breach of duty which results in any type
of loss or injury to the person. It can be said that it is the failure to exercise the care towards a
person which he usually takes. In simple words, it can be said that negligence is the lack of
care of the employer towards its employee. For example: A doctor fails to inform this
patience about the drawback of the operation before conducting an operation.
In the given scenario it is seen that, Roger the employee of the company claims that
he is facing a problem while working for a long period of time. He claims that skin rashes
have occurred on this hand due to low quality dishwasher. But Ben on the hand being the
owner of the hotel provided these employees all type of securities. He has provided rubber
gloves to his employees (Ciccarelli and Ciccarelli, 2005). But at the same time it is the
mistake of his employee that they are not using the gloves provided by the Ben. Ben has tried
to provide all safety measures to its employees and a healthy working environment.
According to employee liability act every employer is liable to provide all safety measures to
its employee at the time of working (Slovenko, 2005). It is the duty of the employer to see
that no employee is harmed from any activities taking place in the organisation. However, on
the other hand it is the duty of the employee too to follow all safety measures provided by the
employer of the company (Koffman and Macdonald, 2010). If he is negligent to follow safety
measure provided by the employer than in that case it is the employee mistake. Employer of
the company is no longer to provide any compensate to its employee (Soled, 2012).
Therefore, after seeing the above scenario it can be concluded that it is the case of employee
negligence not employer's liability. Ben has taken into consideration all safety measures but it
is the fault of the Roger that they are not using safety gloves provided by the Ben. Therefore,
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in this case Ben does not owe any non-delegable duty of care to Roger and other staff
members.
3.3 How a business can be vicariously liable
Vicarious liability is the lawful belief that assign liability for an injured person who
did not cause any injury but has a relationship with the person who did neglectful act. In
simple words, it can be said that it is a liability for the criminal act of another person that is
assigned to someone by law.
In the given scenario it is seen that Colin and Roger both are the employees of the hotel.
Colin is the head chef and Roger is a dishwasher. In this case Colin the chef became
frustrated of the Roger because of Roger continues attitude and anger (Kumar, 2006). One
day Colin hit Roger with a frying pan unconsciously. In lieu of which Roger was badly
injured and when Colin said to go to the hospital Roger refuses to go. Therefore, this is the
case of vicarious liability (Stanberry, 2006). Thus, after seeing the above situation it can be
conclude that Ben the owner of the hotel should take care of this type of situation. He should
make strict rules and policies so that such thing does not happen in the future again.
However, Ben needs to fulfil the Roger claim. Roger claim compensation for his injury from
Ben. Ben as the owner of the hotel is liable to pay certain sum of money to roger as a sum of
compensation. On the other hand Roger also has the right to sue Colin against the unlawful
act made by him. Roger can even claim a sum of compensation from Colin.
TASK 4
4.1, 4.2 apply the elements of the tort of negligence, vicarious liability and defences in
different business situation.
Following are the elements of negligence which are provided to the defence (i.e. suspected
party) are as follows:- Volenti-non Fit injuria: - As per the term injured party has the right to claim
compensation from the suspect party that he unintentionally commits the wrongful
act. Therefore, suspected party has the right to sue the employer or defendant party
(Sweet and Schneier, 2012). Alternatively if injured party committed the act
knowingly than in that case they cannot claim compensation. Necessity:- It states that no employer is liable to pay any sum of compensation to the
damaged party in a situation where employee of the organisation perform any illegal
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act in order to restrict the immoral act. Moreover, defendant party is no longer liable
to pay for the damages unless the negligence act is not necessary. Justification: - According to the act, no suspected party is liable to pay a sum of
compensation to the injured party, if suspected party is able to justify themselves
against the claims imposed by the injured party.
 Illegal: - Every injured party has the right to claim compensation from the
suspected/defendant party if any loss or damaged occurred due to unlawful act
performed by the suspect (Wong, 2010).
Occupier's liability to trespassers was developed under the occupiers’ liability act 1984.
Occupiers Liability act 1984 was establish in order to re frame the Occupiers Liability act
1957. Occupiers Liability Act 1984 was formed for the betterment of the defendant. This act
safes the company from the exploration of the visitors. Therefore, according to this act no
visitor is liable to ask for the compensation if there is his own fault. On the other hand,
Occupiers Liability act 1957 was formed for the betterment of the claimant. According to this
act; defendant needs to pay compensation to the claimant even when it was not their fault.
The following case study depict about the unresponsive behaviour of the customers towards
the hotel management. In this study is about the Regent hotel. Hotel management places a
sign board with a notice on the pool. The notice was 'pool will be closed between 7.00p.m to
7.00 am. Visitors’ entry is restricted. Dangerous when not followed’. But one of the visitors
of the hotel ignores the notice and went into the pool. When he jumped he was injured and
his designer sun glass has broken down because there was no water in the pool. Visitor has
filed a complaint again the Regent Hotel to pay him the amount of compensation for the
damage cause. According to the Occupiers Liability Act, 1957 Mark is liable to claim sum of
compensation for the injury and damage caused to him by the Regent hotel (Uddin, 2015).
On the other hand, according to this act Hotel management is liable to pay compensation to
the Mark even without any mistake made by them. Therefore, as per the reformed Occupier's
Liability Act, 1984 Mark is no longer is liable to claim a sum of compensation from the
Regent hotel management. On the other hand, according to the act, 1984 Regent hotel
management is no longer liable to pay a sum of compensation to mark because of the notice
placed by them. Occupier's Liability Act, 1984 was formed to benefit the Hotel management
from the wrong practices followed by the visitors. Moreover, according to Occupier's
Liability Act, 1984 Mark cannot claim for the loss of his expensive sun glass. On the other
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hand, Regent hotel can claim a sum of compensation from the Mark for the damage caused to
their property by the mark for not following the instruction mentioned.
Therefore, after applying the various elements of tort of negligence, vicarious liability
and defences in this situation it can be concluded that Regent hotel management is correct.
They have the right to claim the sum of compensation from the Mark for the damage caused
to them. It was the mistake of Mark for not following the notice mentioned by hotel
management.
CONCLUSIONS
The following report emphasizes on aspects of contract. In this various elements
required for the formation of valid contract are discussed. In this report various different type
of contract are also discussed according to their type, nature and formation. In this report
different types of case study are also discussed. These case studies are solved by using
various types of elements like tort of negligence, vicarious liability, defences and some of the
elements of a valid contract. These cases studies are also solved taking into consideration
various types of act into consideration. Therefore, at last nature of liability in negligence is
also discussed and difference with various liabilities is also concluded.
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REFERENCES
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reproductive technology. Journal of social issues. 61(1). pp. 127-137.
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Koffman, L. and Macdonald, E., 2010. The law of contract. Oxford University Press.
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Stanberry, B., 2006. Legal and ethical aspects of telemedicine. Journal of telemedicine and
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Sweet, J. and Schneier, M., 2012. Legal aspects of architecture, engineering and the
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Uddin, M., 2015. Aspect of Contract and Negligence for Business[Online]. Available
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