Delivery in day(s): 5
Diploma in Business
Unit Number and Title
Unit 5 ACNB
In compliant with the task requirement criteria a sincere initiative shall be undertaken to perform a detailed analysis of the legal aspects related to contract law and negligence. The latter segments of this Unit 5 ACNB Assignment help solution copy shall also deliver an essence of vicarious liability of employer. Citing of relevant case examples along with details discussion of the given case situation shall also be a part of this particular assignment.
In accordance to the English contract law a contract has be defined as an agreement that is capable of establishing obligations enforceable by the law. The contractual terms and conditions are responsible for the involved parties to remain obliged in this respect. However a legally valid contract is established in presence of elements namely offer, acceptance to the offer, intention to establish legal relation, presence of lawful consideration, capacity of the parties to enter into a contract, free consent. The other key essentials in this context for lawful object, certainty of meaning, not declared to be void and completion of the legal formalities (Australiancontractlaw.com, 2016).
Offer: An offer is presented as a definite and unequivocal promise or desire to remain obliged to the contractual terms without further negotiation. Importantly an offer is the primary step in formation of contract that may be made verbally, by writing or through conduct. Also the terms of the offer should be specified and the offer must is properly communicated to the offeree. However mere statement of selling price of the goods, statement to intention of selling and invitation of treat through advertisement, auction or display of goods are not offer. Termination of an offer can be made following rejection or refusal of by the offeree, through placing of the counter offer, lapse of time, revocation by the offeror, failure to meet the conditions and or due to demise of either of the contracting parties (MacMillan and Stone, 2010). The case of Harvey versus Facey (1893) has discussed the intention of the offeror intention to bind to the contractual terms.
Acceptance: The next step of contract formation is the acceptance of the offer made wherein communication of the acceptance to the offeree is mandatory. Furthermore the terms of acceptance should completely align with the terms conveyed while making the offer and the agreement must be certain (Chen-Wishart, 2005). The case of Entorres versus Miles Far East (1955) can be cited in this respect. The case of Felthouse versus Bindley (1862) however highlighted that silence of the offeree cannot be considered as an acceptance to an offer. It can be further added that postal rule was applicable previously where acceptance to the offer was communicated by post.
A contract can be either unilateral or bilateral in nature wherein all the elements of a contract are present understand a standard contract. In case of a bilateral contract both the parties showing the intention to bind establish a legal relation should be obliged to the contractual terms, while in case of unilateral contract, no element of acceptance is evident and only one of the parties should be oblige to the contractual terms (Chen-Wishart, 2005).
Intention to establish a legal relation: This particular element of contract formation indicates the meeting of minds among the contracting parties the case of Balfour versus Balfour (1919) is an example in this respect. Hence intent of the contract is effective in determining the enforceability of the said contract (Elliott and Quinn, 2007).
Lawful consideration: In a contract, consideration can be defined as the recompense given by one of the contracting party to another. Consideration is also presented as the price payable for the promise of the party is brought. As consideration aid in determining the validity of the said contract is should not be past and should be sufficient in nature. In this aspect the case of Chappel versus Nestle can be cited (Elliott and Quinn, 2007). The case of Day Morris Associates versus Voyce can be considered that discussed the conduct of the defendant was sufficient to let the offeror believe of the presence of mental intent to create the contract.
Capacity: Not all the individuals own the legal capacity to enter into a contract. Individuals who are minor, mentally unsound, disqualified by law do not bear the capacity to enter into a contract (MacMillan and Stone, 2010).
Free consent: Free consent from both the contracting parties involved is essential to establish a contract. According to the legal guidelines free consent cannot be caused y coercion, undue influence, fraudulent activity, misrepresentation or mistake (MacMillan and Stone, 2010).
Lawful object: It is mandatory for the object of an agreement to be valid although it is distinct from considerations. Hence an object is identified as unlawful provided it is forbidden by law, fraudulent, involve injury to the individual or a property or the court has declared it immoral or is opposed to the public policy (MacMillan and Stone, 2010).
Certainty of meaning
Possibility of performance: A contract who terms are conditions are practically feasible in nature reflects the possibility of performance and hence valid (Elliott and Quinn, 2007).
Not declared void: The agreements that fulfil all the conditions for a valid contract and is not declared as void is a valid contract enforceable by law (Elliott and Quinn, 2007).
Legal formalities: Complete accomplishment of the legal formalities like proper documentation of the contract, registration etc is a key requirement for forming a contract (Elliott and Quinn, 2007).
On the concluding ground it is justified to convey that all the above mentioned elements are essential for formation of a legally valid contract. Hence missing of any one of the above mentioned elements do not lead to formation of a legally valid contract.
Formation of a contract without face to face managing communications or conduct can be achieved by considering the distant selling approach. A contract established through this approach enable a supplier and the purchaser of the said contract to establish the contract through written communication indicating intention to enter into a contract (McKendrick, 2011). Distant sales or service regulation scheme are applicable in case of distant selling contract. One of the key essential in this respect is the immense use of electronic media wherein the contractual terms and conditions are communicated through exchange of emails or over telephonic conversation (Lavington, 2011). However postal rule is not applicable for contract established through distant selling approach. One of the key benefits of contract established through distant selling approach is this approach being a spontaneous mode of contract formation enables the parties to expand its business and establish contractual relation with distantly located clients. Hence contract developed through application of the online web service are presented as the online contract. The consumer contracts regulations applicable in this context have replaced the distant selling regulations (Krishnan, 2000).
Furthermore by following distant selling mode of contract formation the consumer has the legal right to ask for inspection of the goods or services prior payment. In such case, a written communication is mandatory. Also for the purpose of cancellation, communication is also mandatory. Therefore contract developed without the physical presence of the contracting parties are also considered as written contract and such contract follow a particular written format and should have complete signatures of both the involved parties (Lavington, 2011). However, considering the case of unilateral contract wherein the offer is convey to the world and acceptance is not mandatory but should be performed as a response to the offer made are not suitable to follow the distant selling approach of contract formation.
Offer in a contract is distinct from invitations to treat wherein advertisement of the goods or services is one of the major examples. However, the words used in an advertisement play a pivotal role deciding whether the lines used in an advertisement merely reflect invitation to treat for enforce the parties to address the terms. In this context the case of Carlill versus Carbolic Smoke Ball Co. can be cited. This particular case emerged from a newspaper advertisement given by Carbolic Smoke Ball Co. According to the words used in the advertisement, the defendant offered a reward of £1000 to any individual who contract influenza after using the ball trice daily for 15 continuous days. The claimant of this case, Mrs. Carlill was evident to purchase the smoke balls and used following the instructions and subsequently was injected by influenza virus. On claiming the reward amount, the defendant was found to refuse stating the advertisement was an invitation to treat. The defendant also added that this claim cannot be addressed because there was no notification of acceptance and also the words used in the advertisement was too vague to form an offer. Absence of consideration in this context was also added by the defendant as a response (McKendrick, 2011). However according to the decisions conveyed by the judiciary body, the statement that referred to the deposit of the said amount clearly indicates intent and hence cannot be considered as a sales puff. Also the advertisement lines indicated a unilateral contract wherein there is no require nets for the offeree to communicate her intention to accept the offer as acceptance was through full performance. Additionally, as there were evidences of certain extent of ambiguity in words used in this case, application of reasonable time limit or confining it to only the individuals infected by flu virus is applicable (Stone, 2003). Hence this cited case is a commendable example differentiating an offer from invitation to treat and to what extent it is fair to claim compensation particularly in case of unilateral contract.
To conclude with it can be highlighted that this case reflecting the legal aspects related to unilateral contract has enabled the readers to understand the significance of words used while publishing an advertisement.
Referring to the given case scenario it can be stated that in this case a contract formation was initiated between the two individuals named William and David. William can be identified as the offeror while David can be considered as the offeree. As discussed in the previous segment, presence of offer, acceptance to the offer made intention to bind to a contract, lawful consideration capacity to enter into a contract, free consent and legal formalities are the key elements for formation of a contract. As observed in the case the contract was initiated through an advertisement posted by William and David responded to the advertisement. This particular aspect can be aligned with the case of Brodgen versus Metropolitan Railway Co. that highlighted acceptance through conduct. His respond can be presented as an intention to bind to a contract (E-lawresources.co.uk, 2016). However the consideration price of the contract was pending to be determined as 10 days time was taken by David. Within the stipulated time period, both the parties observed to agree to the price quoted by David and as advance William paid £1000 to David. This again indicated William’s intention to bind to the said contract. Presence of free consent was also evident as the advance payment was made with respect to timely consideration (Kuhnel-Fitchen and Hough, 2014). The amount of money paid as an advance to David can being identified as consideration is also assumed to be sufficient enough to reflect William’s intention to enter into a legally valid contract with David. The price quotation that was given by David subsequently accepted by William indicated the intent of both the parties to establish a contract between them. The case of Errington versus Errington Woods (1952) can be cited in this respect (Casebrief.me, 2016). Additionally both the offeror and the offeree of this case being full grown mentally sound adult also indicate their respective capacity to enter into the said contract. Moreover the said contract also indicates the presence of possibility of performance. Hence a legally valid contract has been developed between the concerned parties comprising of all the essential elements that are important for contract formation.
Communication of acceptance to an offer made is the primary requirement criteria to indicate a contract formation process. Learning from the information presented in the given case, following William’s counter offer to complete the assigned task on an earlier date, David was evident to remain silent. Hence as no response from the offeree’s side was evident the said offer can be considered as rejected or revoked. Important to highlight, as consent of the contracting parties is essential in cases where in the contractual terms and conditions are altered. In this case, nothing as such was evident (McKendrick, 2011). The case of Felthouse versus Bindley (1862) can be considered wherein silence of the offeree was considered as rejection of the offer and hence no contract was legally established (E-lawresources.co.uk, 2016). Although alteration in contractual terms is justified but David’s silence to such changes indicate that he is not agreeable to the changes. Therefore in this case, no contract has been formed between the involved parties.
On proper fulfilment of the contractual terms and conditions it can be stated that the performance level of the said contract is achieved. However failure to meet the contractual terms and conditions by any one of the involved party indicate breach and in such cases the injured party is entitled to either terminate the contract or claim for compensation. important to highlight that in case of breach in conditions of a contract the injured party is entitled to terminate the entire contract whereas breach in warranty facilitate the injured party to claim for compensation but is not sufficient to terminate the contract (MacMillan and Stone, 2010). Referring to the case given it is clearly observed that William was informed by David regarding the additional expenses in order to accomplish the additional task assigned by William. Furthermore, William was also evident to agree paying the additionally amount hence giving rise to a new contract between the said parties. Therefore this newly developed contract can be considered as a distinct contract.
Prior entering into detailed analysis it is essential to convey that a contract generally comprise of both expressed and implied terms and the former are generally incorporated while documenting the said contract. On the contrary the implied contractual terms are not documented. However; as expressed contractual terms comprise of warranty and condition it is often a tedious task to differentiate between the above two aspects. Also depending on the circumstance contractual terms often take the form of innominate term (Andrews, 2011).
Another important aspect to be highlighted in this respect is the application of exclusion clause through which the defendant part may limit bearing the risk liabilities. Considering David’s situation it can be inferred that as the statement conveyed by William towards David was merely a request and not term, hence David’s failure to complete the work on given time is not a breach in contract. Hence David is legally in a safe position.
The case depicted has presented a situation wherein David is evident to fell short of labour in the middle of his contractual performance. Shortage of labour is indeed not an intentional act of David. Additionally as evident from the given situation William previously required the equipment by 31st of July which was offer to David and he agreed as William agreed to pay the extra cost of £2000 to David. Although it should be noted that David’s silence cannot be considered as an acceptance to the offer. However as there was existence of a positive agreement by William he cannot deny paying the extra cost following completion of the said work. Furthermore, the additional amount that William agreed to pay David can be considered as a term and hence David has the right to claim the said amount.
In this context it can be also added that amount of consideration was evident to be altered but the parties cannot escape from the contractual terms determined. Also it can be further underlined that the element of consideration is presented as a condition under every contract made (Andrews, 2011). Hence it can be inferred that if William finally refuse to pay the extra amount charged he is definite responsible for a breach in contract. In that case, David is legally entitled to claim for compensation.
In light of legal guidelines a tort can be described as a legal term that indicates violation wherein one individual is found to be responsible for the damage or injury caused to another individual. The damage resulted may be either physical injury or loss of property, money or material damage. Lack of duty of care followed by negligent action result in tort and the party of the individual who is held accountable for the tort incident can be identified as the tortfeasor. In this context it can be also added that tortious liability emerge from the breach of duty that is primarily fixed by the law (Matthews et al., 2009). However such duty is generally towards an individual and the breach incident is addressable by the action for unliquidated damage caused. Additionally tortious liability arises due to acts primarily involving negligence, trespassing and creating of nuisance. Important to highlight, it is the responsibility of the judiciary body to decide whether tortious liability is incident or not. Tortious liability is also evaluated with investigating the severity of the damages suffered by the injured part and the remoteness of the damage. However, causation and forseeablity quotient are also the considered as the key criteria while determining a tortious liability (Elliott and Quinn, 2001).
Contractual liability is tortious liability although bearing resemblance to a certain extent also reflects certain differences. In case of contractual liability it is mandatory for the involved party to be part of a contractual that is not a criterion for tortious liability. Furthermore, in case of the damages suffered as a result of breach in contractual liability is compensated in accordance to the amount of consideration involved which is again not a criteria in case of issues arising from tortious liability. Moreover the existence of a contractual association between the involved parties is investigated by evaluating the damages emerging from breach in contractual liability. Another key difference between the above mentioned terms is with respect to the nature of duty. In case of tortious liability the duties are fixed by the law while in case of contractual liability the duties to be followed are decided by the contract made (Krishnan, 2000).
An injured party can successfully establish a negligent claim provided the supporting evidences prove a duty of care owned by the defendant to the injured party, the breach in duty of care has occurred resulting a damage or injury to the claimant. Also the issues related with cause in fact, proximate cause and the damages should be evident in this respect. The modern law of negligence was developed in light of the case of Donoghue versus Stevenson (1932). Furthermore in order to affirm the negligence claim several tests or investigative procedures have been developed down the time line. Caparo test is one such kind that is implemented t investigates the extent of personal injury and or property damages cause as a result of absence of duty of care by the defendant. For determining the psychiatric injury Alcock test is conducted (Abele, 2003). Furthermore the case of Vaughan versus Menlove (1837) can be reviewed to understand the objective test applicable to determine whether breach in duty is evident or not. The case of Glasgow versus Taylor can be cited to understand ways to determine whether the degree of care needed is less compare to the injury caused. In order to evaluate the primary cause behind the negligence act ‘but for’ test can be executed (Bailii.org, 2016). However an interesting case of Baker versus Willoughby (1970) has presented a no loss, no compensation situation. Another key essential for determining a negligent claim is to evaluate the remoteness of the damages caused for which Wagon mound test is applicable (E-lawresources.co.uk, 2016). The popular case of lamb versus London Borough of Camden can be reviewed for better understanding of the remoteness of damages with respect to negligent claim (E-lawresources.co.uk, 2016).
In an organizational domain the legal implications of vicariously liability of the employer is frequently evident wherein the concerned employer or the concerned organization is held vicariously accountable for the wrongful act caused by its employees. However the determining question in such cases is whether the employee was acting in a personal capacity or it was during his course of employment (Giliker, 2010). An organization or an employer is held responsible on such ground provided the claims made are completely justified. Hence in order to establish vicarious liability of an employer it is essential to determine the status of an individual’s employment. Execution of employment status test, control test, integration test etc are the investigative procedures to determine vicarious liability of the employer (Matthews et al., 2009). The case of Catholic Child Welfare Society versus Institute of the Brothers of the Christian Schools popularized the concept of ‘business enterprise risk’ that subsequently was aligned with vicarious liability of the employer (swarb.co.uk, 2016).
The case of Panorama Developments Limited versus Fidelis Furnishing Fabrics Limited (1971) can be reviewed wherein it was evident that a company secretary fraudulently hired cares for his personal use without informing the managing director of the said company. The company was held vicariously liable as the company secretary routinely entered into contract using the company’s name and hence the concerned organization should bear the administrative liabilities (Webstroke.co.uk, 2016). Another case of Deatons versus Flew can be considered as an example that presented a situation where in the employee was found to perform that task assigned by the concerned employer; hence the employer is held vicariously responsible (Matthews et al., 2009).
On the contrary in some cases the employer or an organization is not held vicariously liable as the evidences gathered and the test conducted do not affirm vicarious liability. In this context the case of Sweeny versus Boylan Nominees can be considered wherein the employer was not held vicariously responsible as the case provided evidences of contractor’s involvement to the tort committed. Important to highlight, an employer cannot be held vicariously responsible for the tort committed by an independent contractor or a third party (Austlii.edu.au, 2016). Furthermore the case of Battistoni versus Thomas can be cited as an example in this context. This cited case reflected a situation where in the employee intentionally committed the tort and it was also beyond the scope of his employment. In such case the concerned organization was not held vicariously liable (Giliker, 2010).
The Case of Donoghue versus Stevenson (1932) is popularly known as the ‘snail in the bottle case’ which is also an important case with respect to tort law. In this depicted a situation where in a claim for placed against the manufacturer of a ginger beer company. The primary reason behind such a claim was the presence of a decomposed snail found by the claimant from a bottle of ginger beer. Extensive personal injury was also suffered by the claimant. The verdicts produced in this case thereby established negligence that was further considered as a tort by the House of Lords. Another important aspect proved in this case was the absence of duty of care from the defendant side that was reflected through the presence of a decomposed snail in the ginger beer bottle. Another important outcome of this case was the application of ‘neighbour’s principle’ that subsequently extended the tort of negligence beyond tortfeasor and the immediate party. The investigations in this case also indicate that the damage suffered by the claimant, Mrs. Donoghue was not too remote. It was also established that the manufacturer of the ginger beer company could easily foresee the physical injury a consumer may suffer after consuming ginger beer from a bottle comprising of decomposed snail body (E-lawresources.co.uk, 2016). The case of Hill versus C.C of West Yorkshire can be cited which is a contrasting case with respect to the previously discussed case. This cited case involved multiple murders convicted by the same individual however claim as placed by the mother of the final victim named Jacqueline Hill (Bailii.org, 2016). This case presented a contrasting situation and outcome to that of the Donoghue versus Stevenson case; however tort is evident in both the cases. The negligence claim was filed against the chief security officer stating that it was due to the negligent way of detection and detention of crime, such a tort is incident. Coming to the outcomes of this particular case, it was observed that the judiciary body declared that the defendant does not own any duty of care towards the claimant and hence the negligence claim was nullified. In support to this declaration made it was stated that the police has no duty of care towards detection of crime. Furthermore the verdicts of this case also highlighted that the victims were greater in number and the policies are not entitled to dictate the responsibility of the police officials and hence the police is not obliged to perform duty of care towards the citizen (Bailii.org, 2016).
On a comparative note it can be stated that in case of Donoghue versus Stevenson the judgement given being in favour of the claimant justified that the defendant is responsible for the negligence act and the concerned ginger beer manufacturer owned a duty of care towards his consumers (E-lawresources.co.uk, 2016). On the contrary the other case although indicated a brutal crime could not establish the duty of care owned by the police officials although they belong to a legal system. The duty of care was not limited to the neighbours itself.
On a reflective note, it can be stated that the verdicts produced in the case of Hill versus C.C of West Yorkshire is not just a verdict. It should be a justified approach to prove that the police own a social responsibility to protect the citizen. Not only protection from crime is the primary duty of the police but prevention of crime is also a part of their duty. As a personal perception, the defendant should be held responsible for the crime incident. Furthermore it is justified to place a negligence claim in this context because the police official of every nation own a duty of care towards their citizen and this duty of care should be reflected through prevention of crime and protection of the citizen from the criminals.
The given case situation can be aligned with the legal implications of vicariously liability of the employer. Referring to the case it is evident that a taxi service company is aimed to be initiated wherein the concerned organization has considered not taking any responsibility towards accident occurred or the action performed by the appointed taxi drivers. This is completely unjustified as said action is a part of the professional duty of the taxi driver who should be appointed by the taxi service centre. Hence legal implications of vicariously liability of the employer should be imposed over the concerned taxi service company (Brodie, 2010).
This case can be better understood by reviewing the case of Limpus versus London General Omnibus Company. In this case a road accident was incident due to the reckless driving of the driver. Hence negligence action was strongly evident. however as the accident was incident due to the negligent driving of the bus driver, the bus company was also held vicariously responsible because of the fact that the tort committed was a part of professional duty of the driver and it occurred during his tenure of employment. It can be further added as in such cases although the driver is evident to commit a tort while performing the authorised action but the liability has to be bearded by the employer and not imposed only on the bus driver. However, the concerned company can definitely sue the accused driver and also claim compensation to cover up certain extent of the loss suffered (European Encyclopedia of Law (BETA), 2016). In this case the concerned taxi service company cannot implement legal aspects of contributory negligence as a defence if held vicariously responsible. Furthermore implementation of the Salmond test is suggested that aid in investigating whether the employer will be held responsible or the authorised act was conducted by the employee in an unauthorised manner (Brodie, 2010). The case of Century Insurance Co. versus Northern Ireland Road Transport Board can be cited as a reference to vicariously liability of the employer wherein it was examined whether as act committed was during his course of the employment tenure of the accused (swarb.co.uk, 2016).
The tasks addressed in this given assignment can be considered as reflection of legal implications of contract and tort law. It is also justified to convey that this assignment shall enable the reader to have a significant insight regarding contract, elements of contract, negligence, vicarious liability of the employer and contractual liability issues. The case examples cited also commendably contribute towards enrichment of the given assignment.
Andrews, N. (2011). Contract law. 1st ed. Cambridge: Cambridge University Press.
Austlii.edu.au. (2016). Sweeney v Boylan Nominees Pty Ltd  HCATrans 78 (3 March 2006). [online] Available at: http://www.austlii.edu.au/au/other/HCATrans/2006/78.html [Accessed 16 Nov. 2016].
Australiancontractlaw.com. (2016). Australian Contract Law | Julie Clarke. [online] Available at: http://www.australiancontractlaw.com/cases/lestrange.html [Accessed 14 Nov. 2016].
Bailii.org. (2016). Hill v Chief Constable of West Yorkshire  UKHL 12 (28 April 1987). [online] Available at: http://www.bailii.org/uk/cases/UKHL/1987/12.html [Accessed 16 Nov. 2016].
Bailii.org. (2016). Taylor v Glasgow City Council  UKHL 2 (18 November 1921). [online] Available at: http://www.bailii.org/uk/cases/UKHL/1921/2.html [Accessed 16 Nov. 2016].