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Aspects of Contract Business Relation Assignment
This Aspects of Contract Business Relation Assignmentis said to be a formal relationship between the parties for a specified motive. Such motive Is common between the parties and need to be definitive of the duties of each parties under the contract. Furthermore, the relationship shared by the parties is to be certain as to whether it is a social contract or a commercial contract. The remedies so available in the case of breach of the contracts are defined based on the relationship of the parties shared. Different types of liabilities arising under law of tort from negligence and vicarious liability is also essential to the study to further determine the answers for the case studies so 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.
There are certain elements of standard contracts which are to be discussed which are given below:
- Offer- Offeror is the person which provides the offer to the offeree. Offer occurs in the condition when an invitation is availed by one party so as to make the sale of particular thing so as to attract the interest of people present in the market. If the interested party accept the invitation and shows the acceptance then it is said to be offer. In this purchasing party become an offeror and selling party become offeree.
- Acceptance- When the offer is accepted by the offeree it is called as acceptance. Through acceptance, both the parties enter into a contract. The acceptance must be expressed to offeror and be clearly understandable to the same. Because both the parties have the knowledge about the contract, it takes place by accepting the offer. When the acceptance is made by posting the letter then it will be termed as valid when the acceptance will be posted (Adams, 2008).
- Consideration- It is the value or the amount sacrificed by the party so as make sure that all the aspects of the contract could be fulfilled, that amount paid is known as consideration. There are various forms in which consideration could take place they are either in monetary form, in the form of property, or in the form of forbearance which could be executory or executed. Presentation in the legal form of the consideration is important. Consideration mostly takes place in Sale of Goods Act.
- Intention- The nature of the contract is determined by the intention of the parties so it should be clear and specific. According to it, there are two type of contracts that exist they are social contract and commercial contract. Social contracts are not enforceable until the same is determined but commercial contracts are assumed to be enforceable whether it is mentioned or not in the same.(Andrews, 2011)
- Capacity- Capacity is termed as the ability of a party so as to enter into the contract. These abilities consider the age of the person, mental capability, and his financial status at the point of time he is entering into a contract. The capacity is termed as appropriate when the person is majority of age which means 18 or above 18, financial stability and sound minded.
1.2: Discuss the impact of forming contracts
- Face To Face Contacts- The contracts which are entered into by conversation are known as face to face contracts. Availability of both the parties is necessary in such type of contracts. It is not necessary to present such type of contract in a written form. Restrictions are created in such type of contracts in a verbal form. For the termination of the contract conversation between the involving parties is necessary.
- Written contracts-Contracts which are presented in a written form and parties show the acceptance by giving a written confirmation is known as written contracts (Finch, 2007). These could be shown in the form of evidence in the court of law.
- Distance selling contracts- There are several contracts which could be entered from any part of the world. It is necessary that acceptance should be made within 15 days if parties want to fall in distance selling contract. Such type of contracts could be cancelled within 30 days. All the terms and conditions should be presented by the seller including tax rate, price etc. as soon as possible to the buyer. This contract is regulated by the Distance Selling Regulations of 2000 (Collins, 2008).
1.3: Give an analysis of the following terms in contract with reference to their meaning and effect as it may apply to peter Abraham
- Condition- It is necessary that conditions should be presented in the contracts. Conditions ensures that the contract include all the aspects related with the terms that are to be involved into it according to the court of law. In case conditions of the contract gets breached then affected party have right to file a claim against the breaching party.
- Warranty- Warranties are the type of term which should be availed in the terms of contract. Non performance of the warranty does not have any direct impact on the contract but then too affected party could file a claim against the damage caused due to non performance of the warranty.
- Innominate terms- innominate terms are not certain, means they depends upon the situation occurs at the time of breach. Decision is made by the court according the type of damage occur and the losses it caused to the affected party (Giliker, 2010).
- Exclusion clause- The clause which are provided by the party to another party while entering into the contract is known as exclusion clause. Function of the exclusion clause is to limit the liability in case of any claims are made by the party (Cooke, 2007). In case any injury or death occurs then the exclusion clause will not be liable to limit any type of liability.
2.1: Apply the elements of contract in the given business scenarios below
This is a case of a person whose name is Carol, Carol is a customer who wants to purchase a couch which is being advertised in a newspaper. It could be said that it was not a direct offer but was a mere intention of the seller to invite the offer from the people present in the market. That’s why the advertisements were merely making invitations and the same shall not be regarded as an offer to a sale. These kinds of advertisements are either rejected or accepted depending upon the buyers. In this case, carol only sent an e-mail just to make an offer. Acc. To the case of Carlill v Carboloc Smokeball Co. such type of activity cannot be termed as contract because no acceptance is made by the seller. This type of activity is known as offer but not contract (Collins, 2008).
The case is regarding Devi who wants to work in a cyber security company. Through this way he applied for that company and interviewed for the position he wants. But his dad was creating some trouble so he asked his dad not to interfere as he wanted to be something by his own. Luckily he got the position on 12th of April. His dad was unaware about all this and thus he went to the company and gave them an offer that if they hire his son for the position he would pay be an amount of 150,000 Pounds. This offer was made by Devi’s dad on 13th of April. It results in unacceptance of the contract because the contract was already entered before a day and the amount offered by Devi’s dad in not valid due to already existing contract. Acc. to the case of Mills v Wyman consideration was already occurred before the offer made by Devi’s father. Hence, no contract could be entered by the Cyber Security Company (Vettori, 2007).
2.2: Apply the law on terms in the following contracts.
The case is related with a couple who visit to a restaurant to have their lunch. At the time of entrance, they checked the coats and in return they got a slip. It was written in the slip that the restaurant is not responsible for any kind of checked items. In this case, man had forgot the wallet in his coat but when he came back after having dinner he could not find his wallet in the pocket of the coat. Clause presented with the help of a slip will be termed as an exception clause because it is presentation with the intention to avoid any kind of claim made for the damage by the party entering into the restaurant. The meaning of exclusion clause is to restrict the obligation in possible circumstances and not give any right to any customer. Thereby, the clause of exclusion was applied when it is written and provided when the coat of the customers were checked. Acc. to the case of Estange v Graucob it could be said that claim made by the couple is not applicable to the restaurant because exclusion was provided and protecting the things from theft is not a primary duty of restaurant. Its primary duty is providing the food which is being ordered by the customers (Andrews, 2011).
The case is related with the tenant who had performed a repair work with the agreement of the owner of the house. Repair work was performed with mutual agreement of the owner of the property and helped in adding value to the property. Due to this reason owner of the property promised the tenant to not to increase the rent for the next five years (Meyer, 2010). One year passed after which the owner of the property died due to which inheriting party became the owner of the property who forced tenant to pay the increased amount of rent for which tenant refused to pay. With the study of case it was analyzed that a tenancy contract was build to ensure that peaceful enjoyment. With the proper evaluation of the case it could be said that the tenant has right to claim the expense occurred in repair work because this activity helped in adding the value to the property.
2.3: Evaluate the effect of different terms in the given scenario
The case is regarding the policy and certain questions made by the policy company by the customer that whether there was any involvement of previous claims in the matter of motor vehicle. For this question policy holder answered in no. But with the inspection information was gathered by the policy company that previously two claims was made by policy holder and the parts of the motor vehicle were changed (Anderws, 2011). It could be seen that the questions made by the policy company were directly related to the motor vehicle in which false representation was made by the policy holder which breach the condition. In this case policy company have right to void the contract with the policy owner as false representation was done by the policy holder. Case discussed under Poussards v Spiers.
In this case study it is determined that in the policy form the answers to the questions that are provided were wrong and unable to represent the true and real facts regarding the policy undertaken for the motor vehicle. Hence in this case, if the holder of the policy put in the answer to the question as no, asking for the previous claims of theft being made or not, for both the authenticity and also for the vehicle and its sub-parts so used then it would be considered as misrepresentation. In this case the vehicle parts had been replaced. It was analyze that there were two claims made by the owner of the same vehicle. One claim was under consideration of the policy holder and another claim was not in the consideration of the policy holder (Richards, 2006). It could be said that the term was misrepresented in this case which was directly related with the motor vehicle and was important for the policy. In this case company can void the contract with the policy holder as he tried to misrepresent the information and do not provide correct information. Case discussed under Bisset v Wikinson.
3.1: Explain the similarities and differences of liability in tort with contractual liability using an example.
Certain similarities and differences are there in liability of tort and contractual liability (Morgan, 2011). Any breach in the liability under tort or contractual liability it is only required that the party which is affected should provide the breach and there is no requirement of presenting reason behind the breach for the claim. Both tortuous liability as well as contractual liability is known as strict liability. Voluntary acceptance of the duties is necessary so as to generate the liability.
These two branches of liability are different in many ways and these differences are mentioned in the following table-
Base for claim
Liability under Tort
It varies from situation to situation and is not in of quantifiable nature.
Quantifiable, damages could be claimed in monetary terms
Purpose the behind the breach approached.
Purpose is not considered.
Aspects that get affected
Right of rem got affected.
Right of personam got affected Giliker, 2010)
It is taken into consideration
It is not being taken into consideration.
Scope of tortous liability is unlimited.
Scope of contractual liability is limited.
The solution of this tort is through a consideration.
The solution of this contractual liability is of restoration or restitution.
3.2: Explain using suitable example how liability for negligence can arise and the conditions needed to be met for ac claimant to successfully prove negligence.
There are several factors that are taken into consideration under the liability that comes under tort which are regarded as the negligence. Certain factors are taken into consideration which helps in determining the liabilities under tort, these factors are neglecting the duty of care and avoiding the duty which cause damage to other party which could be calculated either in terms of monetary aspects, psychological aspects or in terms of physical damages (Richards, 2006). It is necessary that duty of care should be taken into consideration and that too it is necessary that it should be taken into consideration for the whole society. Liability is created in terms of certain payments when the negligence of duty of care occurs. Presentation of the damages is necessary so as to validate the claim.
Discussion related with certain elements of liability of tort will help in developing better understanding with the fact-
- Donoghue v Stevenson- The case is related with Mrs. Stevenson who went to the cafe with her friend. Mrs. Stevenson’s friend brought ice cream drink for Mrs Stevenson. After some time when half of the drink was finished it was discovered by Mrs Stevenson that there was a decomposed snail in the drink because of which she felt a stomach pain and psychological loss started to occur. These issues were claimed to the manufacturer. Hearing of this case was done by Lord Atkin in which manufacturer of the product was claimed for the defect in the product. According to the laws of consumer court it is necessary that the product should be prepared by the manufacturer in such a manner that the users using the product should not get affected by the product and nor the society should get affected by the product.
- Caparo industries plc v Dickman- Under this case, the court has mentioned there were certain principles that were presented they were-
- Remoteness of damage- damage arising should be directly related to the cause due to which it got arised.
- Proximity and foreseeability- area in which the damage is occurred should be same for the breach also.
- Causation- damage occurred and the reason for the damage should directly related with each other.(Morgan, 2011)
There are several things that are taken into consideration in the liability of tort these things are comparative negligence, Volenti-non fit injurial or negligence held by the minor(Bell, 2013). Comparative negligence for business is the negligence in which both affected party as well as the party by which damage is caused are finding responsible for the negligence. Volenti non fit injurial is a kind of negligence in which one duty of care is neglected so as to ensure that other duties could be managed in a proper manner. In this negligence is done intentionally. Minor negligence is the negligence in which damaged are occurred by a person of less than the age of 18 years.
According to the legislation people less than the age of 18 years are termed as children who do not have the capability to make decision between what is right and what is wrong.
3.3: Explain what the vicarious liability means and how a business such as your organization can become vicariously liable giving example.’
The vicarious liability under the law of tort is considerable as the party is responsible for the other party for driving the benefits out of the work so it is fulfilled by the party which is performing the work. The meaning of this is that when one party derives the benefit and the other party works the liability of the former party towards the latter so arising. Such liability is considered as vicarious liability. Vicarious liability basically refers to the responsibility towards another party. It can be found in employer- employee relationship as the employee works for the benefit of the employer under various situations. Such duties arise from delegation of the duty by the employer. However the employer would only be responsible if the duty so breached is within the scope of employment and not outside of this. The breach shall be from only the professional obligation and not personal.Other arrangements of this type whereby the vicarious liability may prevail are that of master servant, agency and partnership. It is because of such relationships, the parties are bound to perform for the benefit of another party those results in vicarious liability.(Morgan, 2011)
According to The Health and Safety at Work Act of 1974, it is the duty of the employer to maintain the atmosphere of the organization in order to maintain safety so that all the mishap can be avoided. The employer should consider some facilities like water, equipment and such other things to ensure that the employee is free from any damages or injuries. As an occupier under the Occupier’s Liability Act, It is the duty of the employer that the welfare of all the visitors and non-visitors, both those are permanent and temporary is kept to provide safety. For this purpose only, it is important to know that the premises is set up with safety signs to put across the danger message in case it persists on the premises.(Richards, 2006)
4.1: Apply the elements of the tort of negligence and defenses in the given business scenarios below:
The case study is in relation with the patient who approached to the hospital because he was suffering from the breathing issues and having chest pain. Doctor prescribed some medicine and provided the injection. Next day it was found that same patient was died due to pneumonia because toxic mould was present in the house (Morgan, 2011). With the investigation it was found that doctor had not done proper checkup of the patient before prescribing the medicines. It is necessary that doctor should ensure that proper checkup should be done before providing any prescription to the patient and in the case of chest it becomes more important to checkup the patient because such type of pains is the indications of the heart attack. As a professional doctor such type of negligence could not be afforded. Hence, it could be said that in this case personal and professional negligence was occurred.
It is required that whether the cause and effect were directly relating the damage or not. It was analyzed that reason behind the death of the patient was pneumonia. Patient did not die because of heart attack or pain in the chest. It is necessary to apply the But for Test in such scenario. It is the test that helps in finding out the reason behind the damage so occurred due to the negligence. Professional negligence was occurred in this case but the reason for death was not the same. Hence, in this case doctor will only be responsible for the professional negligence and not for the damage caused to the patient. In this case doctor cannot be sued because of the death of the patient hearing held under the case of Froom v Butcher (Giliker, 2010).
4.2: Apply the elements of vicarious liability in given business situations below:
The case is related with the driver who was asked by the employer to pick up a person from the airport. Driver went to the airport which is a professional duty pf a driver. He reached to the airport and noticed that the flight was delayed and will arive late from its original time. In that span of time driver thought to have a drink. After the arrival of the flight driver picked up the person that is to be picked up and started to drive back to the place where he is suppose to be dropped. Driver was still in the drunk condition. After some time of driving driver lost his conscious and met with an accident due to which both driver itself as well as the client got certain injuries. In this case driver did not breach the formal duties as he was performing his job to drop the client to his destination. Drink and drive was not in the professional duty for which driver will be responsible but for the damage so caused employer will be responsible because driver was working for the benefits of the employer. Case discussed under Lister v Hesley Hall Ltd. hearings (Richards, 2006).
The case is presented in relation with vicarious liability which arises in employer and employee relationship. This case is about the accident that occurs in the super market which took place when the professional duties were being performed. Such type of accidents questions health and safety aspects of the workplace. It was evaluated that the health and safety aspects are looked after another company as supper market do not looks after the health and safety measures of the workplace. Accident so held was because of the pellets was being loaded into the truck. In such type of situation according to the law the responsibility of accident will go with the super market because it is stated that organization which is directly involve in the activity remains responsible for any kind of accident. It could be evaluated that in this case super market will be termed as responsible for the accident as the activity of loading the pallets was held in the supermarket itself. It could be said that vicarious liability will be bear by super market (Bell, 2013).
The Aspects of Contract Business Relation Assignment aims at gathering the knowledge in relation with the law of contract and law of tort. The types of contracts and its nature are discussed along with the meaning and nature of the types of terms. Terms that are present in a contract may range from different types such as the express, implied and such other. The different scenarios so arising under the contract are determined with the help of various concepts so derived. The element of breach has been evaluated with respect to law of contract and law of tort. The different liabilities arising under law of tort ha also been presented in order to determine the solution to the case studies.
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.
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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.