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ACNB Contracts and liabilities Assignment
Diploma in Business
Unit Number and Title
ACNB Contracts and liabilities
For a contract to be present, the parties should have the meeting of the minds as the contract has the one purpose for which the parties come together. The validity of the contract is to be determined based on various elements such as the offer, acceptance, intention and such others. Here in this ACNB Contracts and liabilities Assignment there will be a discussion contracts and the format of entering a contract with some knowledge on different types of liabilities which should be taught to everybody as they have practical implication in the daily life of a person. The effect of breach of contract is determined based on the types of contract or types of terms involved under the contract. The difference between the breach of the contract and breach of duty of care is to be determined under the assignment. The knowledge and information so derived is to be applied towards solving the case studies provided.
1.1 Explain to Peter Abraham how a contract is formed and the importance of the various elements which has to be present to form a contract
A contract is considered to be a relationship between the parties to ensure that the purpose of the contract is fulfilled by both the parties. It is therefore required to determine the nature of the contract based on the different elements so involved at the time of entering into a contract. Such elements may be that of making an offer, accepting it, exchanging consideration or intention to enter into a contract by parties that may derive the meaning of the contract. Therefore, the first step towards entering into a contract is regarded as that of the offer. An offer is considered a statement of terms and conditions that a contract would be entered into for. Such offers shall be clear in meaning and be able to understand by anyone to derive the exact meaning. An invitation to offer is different from the offer. This is because an invitation to offer is merely a stamen inviting for offers from the interested parties that are willing to enter into a contract. The different types of offer that may be categorized are that of general offer and special offer. In Carlil v Carbolic Smoke Ball it was discussed that the offer so made was made to the public and the acceptance would amount through performance of the stated act. As Mrs. Carlil bought the medicine a contract was created. (Andrews, 2011)
When the party that is being presented by the offer expresses the willingness to enter into a contract then the same is categorized as an acceptance. The acceptance so presented should be clear and precise. The same should be presented within reasonable time and through a valid means of communication under the contract. In certain contracts such as that of offer to the world, the elements of acceptance is waived off as the contracting party performs the actions so determined under the offer to conclude the acceptance of the same. If the acceptance is expressed through a post then the postal rule would apply. According to the postal rule, the acceptance is communicated as soon as it is posted.It may happen that the offeree is not satisfied with the offer and may negotiate. Such an offer is then considered as a counter offer until the final acceptance is made for the final offer. An offer may be withdrawn if the acceptance is not made. Also, it may only be accepted by the offeree.(Adams, 2008)
Every contract should include the exchange of something of value to restore the detriment so suffered by the parties under the contract. Such exchange has to be presented to the other party at the time of entering into a contract. The value is often regarded as consideration to enter into a contract. Such consideration should not be of past nature, sufficient, not be derived from the existing contractual duty or social duty. It may be either money or promise to do something. In the case of Chappel v Nestle it was determined that the wrappers will suffice as being consideration as they provided value. Therefore, the consideration shall be sufficient for the contract to e formed and not complete. The consideration may be bargained for if the same is not according to the expectations. Therefore, the final consideration will be checked for validity of the contract.
The parties to the contract shall be clear of the intent for which the contract is being formed. This would mean that unless the intent is so determined the parties may or may not be able to enforce the same under the law depending on the nature of the contract. If the contract is entered into for commercial purposes then it is presumed that the same is entered into with the intent to be enforceable under the law whereas it is not the case for social contracts. In the case of Meritt v Meritt it was discussed that whereby the intent to be contractually bound is present the presumption is rebutted. Therefore, the contract for separation is considered valid. Sometimes the commercial agreements contain the honors clause rebutting the enforceability of the contract under the law in the name of gentlemen’s agreement.
Every party to the contract should be eligible to understand the intent of the contract and the purpose for having one. Therefore, the understandability of the contract may be derive d by a person if he is into suffering from any illness mentally, or is not economically sound or is minor. The capacity to enter into the same has to be checked against the age, financial status and soundness of mind. Although, if the contract is entered into by a minor for the purpose of necessity then the same may be voidable at the option of the contracting party. A contract entered into by the mentally challenged person is valid if the guardian or the caretaker performing on his behalf in his best interests enters into the same.Under the case of Nash v Inman the waistcoats so provided to the student were not a necessity and therefore the contract is said to be void in nature. (Finch, 2007)
1.2 Discuss the impact of forming contracts
The contracts that are entered into in the existence of the other party are known to be face-to-face contracts. Such contracts may be either written or oral. If the contracts are written then they may be easily enforceable. Very often it is happens that the face-to-face contracts are considered oral contracts. This is because the parties enter into a contract by a mere conversation. However so, the contracts of such types are difficult to be enforced under the law for the lack of presence of the written terms and conditions. The only evidence to be presented is hearsay that is weak.In the case of Cundy v Lindsey it was discussed that under face to face contracts the person so entered into the contract with may not be the same we are actually entering the contract into with. Therefore, the contracts whereby the identity was fraud the contracts will become void ab initio. (Meyer, 2010)
Contracts that are entered into by the parties through signing the documents are regarded as the written contracts. Such contracts are to be entered into by the parties through signing the contract containing the common terms and conditions so discussed by the parties. The meaning and nature of the contract is to be clear and express to avoid any confusion. At the time of breach the contract is to be established according to the terms so presented under the written contract. Certain contracts are required to be present in writing such as the real estate sales, paying off of debts, lease agreement or transfer of property. According to the parole evidence rule it was discussed under the case of Pym v Campbell that wherein the written agreement is present only the written terms are applied.
If the sale of goods or services takes place from a distant part of the world through online platform then the same is regarded as a distance-selling contract. Such contracts are to be determined in writing to the purchaser. The contract shall include all the terms and conditions of the contract and the transaction details so concerning. The provider is to mention the prices, taxes, terms and delivery details while entering into a contract. The remedy measures shall also be provided in case of any loss or breach. These contracts are regulated by the Distance Selling Regulations, 2000. The Consumer Rights Act of 2015 is applicable to the distance selling agreements. If the same are found to be faulty then the goods may be returned within thirty days of the purchase. If the digital content is sold online the same may be replaced if the customer is not satisfied with the quality.
1.3 Give an analysis of the following term in contract with reference to their meaning and effects as it may apply to Peter Abraham
The terms that are important to be enforced under a contract to derive the true meaning is regarded as the condition of a contract. Such terms are important to be performed under a contract because if the same is not performed then the contract could not be realized. If the conditions are not fulfilled then the affected party may void the contract. Such conditions may be entered into at different stages of entering into a contract. These conditions may be condition precedent, condition concurrent and condition subsequent. In the case of Poussard v Spiers it was discussed that the agreements so entered into was for the performance at the opening night and the following nights. Madame Poussards had failed to perform at the opening night for being sick therefore; the contract so voided was fair. (Andrews, 2011)
A warranty is related to the performance of the contract but not so critical that the non-performance may result in voiding the contract. This would mean that the breach of warranties may be met with remedies but not affect the nature of the contract. Such remedies may be claiming the damages, injunctions or specific performance. The contract is regarded as fulfilled when the warranties are met with the remedies. In the case of Bettini v Gye, it was discussed that the contract so entered into was for the performances. The rehearsals were not part of the main contract therefore; the breach of the term for the rehearsals is regarded as the breach of warranty. Thereby, the company may be able to claim for damages but not void the contract.
Sometimes some terms are not so clear to be interpreted and classified in order to derive the purpose of including them under the contract. Such terms are required to be categorized based on their non-performance under a certain contract. This would mean that the effect would determine the purpose of the contract. If the breach of term results in affecting the meaning of the contract then it is a condition and if not then it is a warranty.Under the case of Schuler v Wickman Tools the manufacturers had enclosed a certain clause of making 1400 visits in total which the Wickman Tools failed. It was held that the term so breached was a condition as mentioned under the contract but the court held that the same may be a warranty as it does not relate directly to the purpose of the contract. (Adams, 2008)
If a term under a contract restricts the liability to be charged under the breach of a contract then the same would be regarded as an exclusion clause. The clause includes the term to restrict the liability in case of occurrence of a certain event that may affect the nature of the contract. Such clauses that restrict the liability in case of death or injury would be considered as invalid. The terms may include under a contract through signatures, notice or previous dealings. Under the case of Olley v Marlborough Court the claimant booked the hotel and the reception provided a contract that did not include the exclusion clause. The hotel room displayed a notice that determined the exclusion clause. It was stated that the notice is not sufficient, as it wasn’t provided under the contract when the reception had provided the same. Therefore, the hotel will be liable for the loss of the fur coat.
2.1 Apply the elements of contracts in the given business scenarios below
Case 1: Under the present case, it is explained that ac ouch was advertised under the newspaper for the purpose of sale. This would mean that it was an invitation to treat. Accordingly, the person posting the advertisement and promotion wanted to invite offers from the interested buyers. The person so interested in the couch would therefore be making an offer. When Carol intimated her interest regarding the couch, she was making an offer. When the offer is made it may either be accepted or rejected. The email so sent by carol was not met with a response thereby, no contract would be said to have been entered into as no acceptance was communicated. (Collins, 2008)
Case 2: Herein under, Devi was keen on working with a cyber-security firm. He had thereby attended the interview for the same. He had asked his father to not concern himself with the interview process, as he did not want any unfair treatment. Devi had passed the interview and gained an offer on the job on 12th April that was accepted by him. Devi’s father being unaware of the same had presented the company with an offer to hire his son at the price of 150,000 Pounds. The company now is holding the contract against the father. It may be noted that the father is not liable to pay any amount as the contract is invalid for having past consideration. Therefore it may be concluded that the contract is invalid and no claim stands against the father for having offered the amount. (Vettori, 2007)
2.2 Apply the law on terms in the following contracts
Case 3: Under the present case it may be determined that the couple had gone to a restaurant to have dinner and had checked in the coats at the desk. After the coats were checked in they were handed over a receipt stating that the restaurant would not be responsible for the theft or loss of coat or the contents of the coat. On sufficing the meal the couple was missing the wallet that was in the coat at the time of checking the coat. It is no longer in the coat. The couple now wants to claim for the loss so suffered. It may be noted that the exclusion clause may not be applicable under the present circumstances as the exclusion clause was provided after the contract was already entered into. Therefore, the damages may be claimed from the restaurant.
Case 4: Under the present case it was determined that the land lord had promised the tenant to not increase the rent for the next five years as the tenant had undertaken the additions and repair work on the premises. It was further derived that the landlord had died. The person inheriting the property subsequently increased the rent of the premise. The tenant refused to pay the increase and the land lord threatened that he would evict the tenant and not pay for improvements because of which the value of the property increased. The tenant now stands a claim for the expenses so undertaken while using the property. This is because under the tenancy agreement it is an implied term that the expenses so undertaken by the tenant for the improvement of the premises shall be reimbursed by the land lord. Therefore, it is the duty of the land lord to pay back the concerning charges.(Andrews, 2011)
2.3 Evaluate the effect if different terms in the given scenario
Case 5: Under the present case study, the policyholder was asked to fill out the details for the policy to be undertaken for the purpose of theft of car. The policyholder had not entirely filled in the correct information. The term so asked for on the policy forms was to gather the information regarding the claim to be made, therefore they may be regarded as the conditions of the contract. The statement of having made a previous claim for motor vehicle had been denied under the contract whereas it wasn’t true. This would mean that the condition of the contract had been breached as the breach directly affects the purpose of the contract. Therefore, the company may void the contract so entered into for the breach of condition. (Meyer, 2010)
Case 6: Under the present case study the terms presented under the contract for policy had been hidden or lied about. The policyholder had presented otherwise when asked about the previous claims for the motor vehicle and the parts of the car. This would mean that the policyholder misrepresented the conditions so presented under the contract. The policy holder had not presented the change of parts of the vehicle and the claim so made which was rejected under the previous years. Misrepresentation is referred to as a statement of false nature made before or while entering into the contract. If the misrepresentation does not lead to formation of the contract then it will be a statement and if it does it will be considered as a term of the contract. The Misrepresentation Act, 1967, regulates such misrepresentations. A statement for the future intent may not amount to misrepresentation. Therefore, the policy holder may be said to have been misrepresented the terms as the same were directly related to the claim under the policy it would be a breach of a condition. The company may void the contract based on the facts of the case.
3.1 Explain the similarities and differences of liability in tort with contractual liability using an example.
The liability is referred to the obligation to fulfill the affected right of another party. Such right may be derived from an existing relationship or a general right under the society. If the right is specific in nature it may arise from a contractual relationship and if it is present due to the society then the same will be regarded as the wrong under tort. Such liabilities arise for the breach of an existing right. The damaged parties are only required to present the breach and not the method of the same. Such liabilities are categorized as the strict liabilities under the law for the importance of the breach. Following may be differences that may be present between the two types of liabilities:
- The liability under tort requires the damages to be quantifiable but is not so whereas the liability under contract is easily quantifiable. (Vettori, 2007)
- The motive behind the breach of right under tort is relevant whereas the same is not relevant under the contract.
- The right so breached under the tort is the right in rem whereas the right so breached under the contract is the right in personam.
- The cause of breach is not considered under the tort whereas the same is considered under the contract.
- The liability’s scope under tort is unlimited whereas the scope under the contract is limited.
- The liability under the tort is determined through situations and by the judges whereas the contract liability is determined based on the amount of consideration involved.
- The factors considered for the liability under tort are of remoteness of damage and causation whereas the elements of a valid contract are to referred under contract law such as the offer, acceptance and capacity. (Giliker, (2010)
3.2 Explain using suitable example how liability for negligence can arise and the conditions needed to be met for a claimant to successfully prove negligence
The negligence is regarded as the act of avoiding, neglecting or forgetting the performance of a certain duty. The tort of negligence is regarded as a social wrong and is applicable towards every person present in the society. For a negligence to take place under tort it is essential that a duty of care had to be undertaken by the wrongdoer. That the same had been avoided that lead to breach of duty and causing the damages to the affected party in terms of economic, monetary or physical harm. It is to be noted that the damage should be serious and lead to an injury for it to be an act of negligence under the law.
In the case of Donoghue v Stevenson the concept was better presented by Lord Atkin while explaining the aspects of negligence that may be present under a society. It was derived that the when a product is supplied to the market the direct as well as the indirect consumers shall be considered for the safety purposes. Therefore, the manufacturers are responsible to derive the safety precautions against everyone who may be able to use the product. Such a burden is universal and applicable to every manufacturer. (TAN, 2008)
Furthermore, under the case of Caparo Industries plc v Dickman the three fold test to derive the presence of the tort of negligence was derived. The first factor was namely remoteness of damage that explains the relationship between the cause and damage shall be present no matter what extent. The second aspect to determine the tort of negligence is of the causation that determines that a cause and effect relationship should be present no matter how remote. The third aspect would be that of the proximity that determines that the cause and effect shall be possible to be derived from the occurrence of event. If the effect of the actions could be foreseeable then the duty of care exists. (Cooke, 2007). The defenses that are applicable under ort of negligence is that of the volenti non-fit injuria and comparative negligence. Whereby the person committing the negligence does is voluntarily the effects of such negligence are excused for the party causing the damage. If both the parties are involved to a certain extent towards the committal of negligence to cause damage then the extent of involvement of the parties to the damage determines the extent of liability.
3.3 Explain what the vicarious liability means and how a business such as your organization can become vicariously liable giving example.
When the wrong so committed by one party is the responsibility of another person then the delegation of such responsibility establishes a vicarious liability. Such a duty is generally delegated for the benefitting party whereby the party committing the wrong does so during the discharge of official duty. The vicarious liability generally exists under the relationship of the employer-employee. This is because an employee is presented with a task to be performed for the purpose of the employer. Therefore, if in case any wrong is committed while performing the same task it will be the responsibility of the employer and not the employee. The tasks that are illegal or the means to achieve them is illegal then such may be excluded from the vicarious liability. It is essential that the wrong so committed be in the official nature and not personal nature. Other such relationships whereby the vicarious liability is applied is that of the master-servant, agency, and partnership. It is so because herein the duties are shared and delegated to the other party for the performance. Therefore, the vicarious liability is derived as the performance is undertaken for the benefit of another party. (Morgan, 2011)
According to the Health and Safety at Work Act, 1974, it is important that the employer maintains the premises for the welfare of the employees. It may be done by providing the safety measures, sanitation facilities, clean water to drink and updated equipments for the best experience. According to the Occupier’s Liability Act, it is required by the employer or the occupier to ensure that the premises are maintained safely for the visitors both permanent and temporary. The safety precautions shall be undertaken and the warning signs shall be displayed to communicate the unsafe areas. The trespassers shall be considered while undertaking the safety provisions. (Bell, 2013)
4.1 Apply the elements of tort of negligence and defenses in the given business scenarios below:
Case 7: Under the present case study it may determined that the patient had approached the hospital to be treated for chest pains and breathing issues. The doctor was busy and the had asked the nurse to prescribe him the over the counter medicines. Later the next day it was found that he had passed away due to pneumonia from a toxic mould at his home. It may be noted that the doctor would not be liable for the death of the patient. Herein the but-for test may be applied whereby the damage so occurred was not directly related to the breach of duty of care. The doctor could be said to have committed a professional breach for not checking the patient before prescribing the medicine but the same was not responsible for the death of the patient. Therefore, the doctor may be claimed for the professional breach but not for the death so caused from the pneumonia. (Giliker, 2010)
4.2 Apply the elements of vicarious liability in the given business situations below:
Case 8: In the present case it could be determined that the driver was an employee of the company. He was asked to pick up a client from the airport. The client’s flight had not yet arrived and the driver stopped for a few drinks. On receiving the client, the driver drove back in the drunk state. It may be noted that it would be considered to be a case of drink and driving. The driver was performing the official duty when the accident had occurred. The damage so caused to the client and the car had been undertaken while performing the official duty Rose v Plenty. It could be stated that the scope of employment and the damages were remotely related and that the affect so caused from the accident had been present for performing the delegated tasks by the company. Therefore, the company may be held vicariously liable. (Cooke, 2007)
Case 9: The aspects of vicarious liability under the present case are to be studied in analysis of the case study. The present case illustrates that the supermarket had delegated the responsibility of health and safety to another company. An employee while loading unloading the pallets ahd slipped and the pallet had fallen on another employee causing him injuries. The employee now wants to claim for the injuries so caused. The supermarket claims that the responsibility of the injuries is upon the other company responsible for the health and safety. According to the Ready Mix Concrete (South East) V MPNI, it was held that the employer having the direct control over the situation at the time of wrong so being committed would be responsible for the same. As the accident occurred on the premises of the Supermarket, it would be responsible for the injuries so caused to the employee. (Morgan, 2011)
The different types of terms discussed under the ACNB Contracts and liabilities Assignment are that of condition, warranty, innominate terms and exclusion clauses. The importance of such terms has been derived and applied towards the case studies so provided. The different types of contracts have been presented to determine the enforceability under the law. Furthermore, the difference and similarities between the liability under contract and tort is determined. The liabilities arising under the tort for negligence and vicarious liability has been presented to solve the case studies so provided.
Andrews, N. (2011). Contract law. Cambridge: Cambridge University Press.
Meyer, L. (2010). Non-performance and remedies under international contract law principles and Indian contract law. Frankfurt am Main: P. Lang.
Collins, H. (2008). Standard contract terms in Europe. Alphen Aan Den Rijn: Kluwer Law International.
Vettori, S. (2007). The employment contract and the changed world of work. Burlington, VT: Ashgate Pub.
Giliker, P. (2010). Vicarious liability in tort. Cambridge, UK: Cambridge University Press.
Cooke, P. (2007). Law of tort. Harlow: Longman.
TAN, S. (2008). Vicarious Liability. Internal Medicine News, 41(24), pp.36-37.
Morgan, P. (2011). Distorting Vicarious Liability. Mod. L. Rev., 74(6), pp.932-946.
Bell, J. (2013). THE BASIS OF VICARIOUS LIABILITY. C.L.J., 72(01), pp.17-20.
Here in this ACNB Contracts and liabilities Assignment there will be a discussion contracts and the format of entering a contract with some knowledge on different types of liabilities, We are posting Assignment units solutions so scholars can explore the our Assignment Help in UK and get review the quality of our work.