Business Law Report: Contract Law, Advertisements and Variations

This report delves into the intricacies of business law, specifically focusing on contract law and its practical applications. It begins with an introduction to the importance of law in establishing and governing business operations, emphasizing the significance of contracts in ensuring smooth business processes. The report then presents two case studies. The first case examines an advertisement offering a reward for catching a tagged fish, analyzing the legal implications of unilateral contracts and the enforceability of such offers. The second case explores contract variations, analyzing an agreement for an advertisement appearance and subsequent payment installments, including a variation in the payment terms. Both cases are analyzed in the context of contract law principles, referencing relevant legal precedents and highlighting the rights and obligations of the parties involved. The report concludes by summarizing the legal outcomes of each case and reiterating the importance of adhering to contract law to resolve business disputes effectively, and ensuring businesses follow legal rules.

Business law

Table of Contents
INTRODUCTION...........................................................................................................................1
QUESTION 1...................................................................................................................................1
Issue.............................................................................................................................................1
Rule..............................................................................................................................................1
Analysis........................................................................................................................................2
Conclusion...................................................................................................................................2
QUESTION 2...................................................................................................................................3
Issue.............................................................................................................................................3
Rule..............................................................................................................................................3
Analysis........................................................................................................................................4
Conclusion...................................................................................................................................4
REFERENCES................................................................................................................................6

INTRODUCTION
Laws are the basis on which economy of the country is established. Each area of the
economy is governed by law that is specifically designed to deal with the prescribed issues.
Businesses are highly important for economy growth of the country and a law is designed to
guide businesses. Business houses needs to understand the importance of law and perform all the
act legally so that goals can be achieved without any legal intervention. It consist of various rules
and regulations that helps businesses for registration, carrying out operations in smooth manner.
In this project report importance of contract in business is described along with rules and
regulations of contract law (Andenas and Negra, 2017).
QUESTION 1
Issue
Buster Brady who is carrying a small business in hope to promote business gives an
advertisement in newspaper. This advertisement shows that all the fishermen and fisher-ladies of
Keenanville are invited to catch a Big joanna fish on this Saturday. This fish will be tagged by
the Buster an left in the Lake Kanchan. Now, Tommy who is local homeless person who
survives on the fish he caught through lake was not aware about this advertisement. On Saturday
when he went to the lake he was surprised to see so many people their. While unaware of the
advertisement a fish was caught by him tagged as “I am Big Joanna! Claim your price $10000 @
The Crabshack!”
Now in the night when Buster Brady come to know that Tommy was not aware of the
advertisement sent him a SMS. In this he wrote that sorry I changed my mind and no price
money for you today (Chen-Wishart, 2015).
Rule
Advertisement and contracts are important parts of business that helps in effective
business management. A contract is legal binding agreement that involves two party and helps in
governing the rights and duties for which it is conducted. A advertisement is not considered as
contract as contract needs acceptance of both the parties involved. Advertisements are termed as
unilateral contracts which is a legal agreement in which one party promises to take specific
action on the act of other party. As per contract law advertisement are not considered as legal
binding offers but usually considered invitation to business. As per law a advertisement will be
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binding if the financial position of the consumer is affected. As per contract law it is stated by
court that even if the person who is not aware of the advertisement and no acceptance is provided
for the offer. Actions that are performed by the person must fulfil all the requirements and then a
valid contract will exist and participant will be entitled to the reward.
Analysis
In this particular case it is seen that Buster Brady who gives advertisement in the
newspaper is making an invitation to public at large to participate. Tommy who is unaware of the
advertisement brings himself in the position where he can claim the price money that is
mentioned in the advertisement. In Carlill v Carbolic Smoke Ball Co [1893] a landmark case that
deals with the same issue that needs to be resolved (Carlill v Carbolic Smoke Ball Co., 1893). In
this case a newspaper advertisement is placed by company to reward £100 to any person who
contracts the influenza after using balls for three times a day up to two weeks as per the
description. Mrs Carlill purchased the smoke balls and used according to the direction and
caught flu. Now she claim price for this but company is not ready to pay the offered amount. As
all the conditions of the advertisement are fulfilled then Mrs Carlill is entitled for the price that
is mentioned in the newspaper. When critical analysis of the situation of Buster Brady and
Tommy is done it is seen that the same situation is applied to both of them. As Buster Brady is
claiming that Tommy was not aware of the advertisement and he caught the fish by luck so no
price money will be awarded. Analysis of contract law make advertisement unilateral contract in
which one party is bind to perform its promise when the work is performed as per specification.
Unilateral contracts required acceptance of one person only and involvement of both the parties
for acceptance is not required. When rights and duties of the parties involved in the case is
considered then it will be seen that Buster Brady has duty to pay the reward money to Tommy.
On the other hand Tommy has legal right to receive $10000 as award price (Grabham, 2014).
Conclusion
In the above case scenario Buster Brady needs to pay $10000 as the offered price to
caught the marked fish. The law of contract clearly specify this as unilateral contract that needs
to be performed when any financial involvement is their. The contract law also specify that there
is no need to make a communication regarding an invitation that is made through advertisement.
When no communication is made and task is performed as specified then also defendant is in the
position to receive the reward. So, Tommy is eligible to claim the price money to Buster Brady
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and Buster Brady change of mind for not offering the price money will not relieve him form
payment of price money. Buster Brady is legally bound by the contract law to pay $10000 to
Tommy and if not paid then legal actions can be taken. Businesses needs to follow all the legal
rules that are mentioned in the contract law and this will help in resolving in resolving various
conflicts whenever they arises.
QUESTION 2
Issue
Issue in this particular case is generated with the ides of bringing more business with
getting Tommy appearing in the advertisement for 'The Crabshack'. Buster Brady was ready to
pay $10000 to Tommy in monthly instalment if he appears in the advertisement and both of them
got agree to this. Acceptance of the offer by both the parties make this a valid agreement
(Hudson, 2017). As per the original contract payment of instalment by Buster Brady is done for
three months and after that no further payment is made. A variation is made in the contract to
pay $2000 and other $5000 will be waived. Tommy was agreed to this variation and received
$2000 immediately by Buster Brady. On that evening Buster Brady won $5000 in Poker and
after receiving this information Tommy dropped a SMS to Buster Brady. He wrote that no
waiver for the due payment will be provided and Buster Brady needs to make the payment in the
instalment of the amount due. In this issue there is acceptance of new contract, variation is made
in the original contract and after the acceptance change of mind is reflected.
Rule
Contract law is used in the business on daily basis to deal with various issues arises. All
the rules and regulation for the contract is mentioned in the law that guides regarding duties of
the parties that are involved in the contract agreement. As per contract when acceptance is given
by both the parties to the agreement then to took form of contract. A contract is binding on the
parties involved and any breach may leads to legal implications. A variation in the contract can
be made when parties to the contract are mutually agreed to the contract. When a variation in the
contract is made then it is advisable to provided them in written within four weeks. When a
variation is made and one party do not oppose it or perform any task that indicates that variations
are accepted (Margalit, 2013).
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When a variation is made in the contract and both the parties got agree to make final
settlement for this then it leads to completion of contract. A contract when held completed then
can not bind any person to perform any duty that was previously mentioned in the contract
agreement. As per contract law it will be illegal to bind a person under a contract when the final
settlement to complete the contract is made by both the parties. After final settlement change of
mind will not give any legal right to any party to claim any consideration. In the recent case of
Globe Motors v RW Lucas Varity Electric Steering Ltd. [2016], it is clarifies that a contract can
be varied by an oral agreement. Even the contract consist the clause of “no oral variation” then
also variation to the contract can be made and that will be valid (Variation in contract, 2019).
Analysis
Contract entered by Buster Brady and Tommy for appearing into advertisement for 'The
Crabshack' and payment of $10000 will be made in monthly instalment is done is assumed to be
a valid contract. This means both the parties got agreed to the terms and condition that are
mentioned in the contract. Now Buster Brady is unable to make monthly instalment to Tommy
that leads to breach of the contract or can be termed as variation if both the parties got agreed
upon something. When Buster Brady and Tommy entered into an contract then it gives Tommy
right to claim the amount that is agreed in the contract. When no payment is receive then legal
solutions are also available to him. On the other hand Buster Brady is available with the right to
shoot advertisement with Tommy and if any fault is made by Tommy then consideration can be
revoked by Buster Brady (Swain, 2012). When variation in the contract is made and both the
parties got agree to this then it is the right of both the persons to receive consideration that is
newly agreed. By appearing in the advertisement it is the right of Tommy to get paid and when
there is change in contract and he was agree to that change. Then all the variations needs to met
as per the consent and after completion of the contract no part can legally bound another to
perform any task.
As after making payment as the last settlement amount to Tommy, Buster Brady is
released from the contract. The change of mind after receiving final settlement price by Tommy
will not make any difference. The amount that is waived can not be asked to paid in full weather
in instalment or in lump-sum (Vogenauer and Dannemann, 2013).
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Conclusion
From the application of contract in the given case scenario it has been concluded that the
contract that is entered for appearing in the advertisement is completely a new contract. The
payment of $10000 rupees will not be considered as prize money as it was mandatory to pay if it
is termed as price money. All the terms and conditions of the contract needs to be fulfilled in the
same manner as pre decided to make it valid. When variation is made in the contract with the
consent of the parties involved that will be legal and valid. Completion of the contract with the
variation release Buster Brady and Tommy with the duty to perform obligation as written in the
contract. After receiving final settlement amount Tommy can not ask for the amount due whether
in instalment or in lump sum (Willett, 2012). After final payment and forgiving $5000 when
Buster Brady won the price in poker this will not change any decision. As the variations to the
contract was valid and mere change in the mind of one party can not make Buster Brady liable
for paying any amount as per law. As per the rules mentioned in the contract law various issues
that hinders business can be resolved in the most economical manner. From the above all rules it
can be concluded that contracts needs to be performed and all the offers do not take shape of
contract.
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REFERENCES
Books and Journals
Andenas, M. and Negra, F. D., 2017. Between contract law and financial regulation: towards the
Europeanisation of general contract law. European Business Law Review. 28(4).
pp.499-521.
Chen-Wishart, M., 2015. The nature of vitiating factors in contract law. Philosophical
Foundations of Contract Law, Oxford University Press, ISBN, pp.978-0.
Grabham, E., 2014. Legal form and temporal rationalities in UK work–life balance law.
Australian Feminist Studies. 29(79). pp.67-84.
Hudson, A., 2017. The law on financial derivatives (No. 6). Sweet and Maxwell Ltd..
Margalit, Y., 2013. In defense of surrogacy agreements: A modern contract law perspective.
Wm. & Mary J. Women & L. 20. p.423.
Swain, W., 2012. Codification of contract law: Some lessons from history. U. Queensland LJ.
31. p.39.
Vogenauer, S. and Dannemann, G., 2013. The European Contract Law Initiative and the ‘CFR in
Context’Project. The Common European Sales Law in Context: Interactions with
English and German Law.
Willett, C., 2012. General clauses and the competing ethics of European consumer law in the
UK. The Cambridge Law Journal. 71(2). pp.412-440.
Online
Carlill v Carbolic Smoke Ball Co. 1893. [Online]. Available through:
<http://www.e-lawresources.co.uk/Carlill-v-Carbolic-Smoke-Ball-Co.php>
Variation in contract. 2019. [Online]. Available through:
<https://www.pinsentmasons.com/out-law/guides/variations-to-contracts-and-changes-
in-the-law>
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