Unit 5 Assignment on Contract law for Business

Unit 5 Assignment on Contract law Business

Unit 5 Assignment on Contract law for Business


Diploma in Business 

Unit Number and Title

Unit 5 Assignment on Contract law for Business

QFC Level

Level 4


this Unit 5 Assignment on Contract law Business is refer to an agreement which is actually enforceable through laws and rules. Any kind of contract can be agreement but any kind of agreement cannot be referred as contract. Various kinds of legal and valid fundamentals exist that are quite essential in every agreement to convert it to a contract(Cartwright, 2007). The rules and laws can be elaborated as the collection of recommendations and procedures that are basically developed through the support of supreme authority and government of state. Supreme authority and the governmental figures are the most important figures in the formation of rules and laws along with these features they are those who are responsible to enforce the rules and laws that is formulated within the procedure of authority through utilizing different aspects as recommendations. On the basis of the business design, there presents numerous kinds of laws and rules and still the most largely used laws in the businesses which are considered to be the contract laws.

A contract law is basically involves an assurance through the certified and authorized into the laws and rules that is enforced.A contract is considered to be a process that is used by persons regarding the security of their resources. Oral contracts are the contracts that are utilized in any business organization but many times written contracts are much preferable at the time of engaging in any agreements. This is essentially implemented be considering as certified and legalized papers provide organizations as well as individuals of conducting legalized papers that basically elaborately describes the assurance implemented by the parties who are involved. It has been observed that today, carelessness is increasing day by day in the business world, thus it has turned into a procedure of compensating individuals for the damages regarding finance. The objective of this report is to understand the rules and regulations of business. The report will reflect the basic characteristics of contracts and the inattentiveness of contract regarding business. The report will also reflect the essential fundamentals that are required in order to form a legal contract through the help of fundamentals that are involved within the contract during the period of numerous different business situations. The report will alsodiscuss the liability party during the time of carelessness in the functioning of business.

Task 1



When agreements are enforced by rules and laws then it turns into a contract. It is described that all contract can be an agreement but all agreements cannot be a contract. There are numerous types of fundamentals of legalized contracts which are quite necessary and vital to be enforceable by the laws and legislation(Andrews, 2011). The various fundamentals are quite essential for the legalized contract and if the fundamentals of legalized contract are missing then the agreement cannot be described as a contract. Offer and acceptance are the initial step in terms of contracts for the starting of it(Extempore.ie, 2016). In this step one party makes an offer at the time of acceptance it becomes a promise or assurance. The second important cause of promise becomes a consideration and exclusive of consideration a contract is void as consideration can be unlawful and the court can consider it as fraud and illegal. A contract includes a statement of determination and it describes the reason to formulation of a legal impact and it is important for creating a legalized contract(Beale and Tallon, 2002). Various dissimilar parties those are included in the contract should have the potentiality as well as capability to formulate a legal contract. The potentiality and capability describes that the parties who are involved should be mentally sounded as well as should be at the age of 18. So, as per the case of Peter Abraham, he is able to create a legalized contract as he is mentally sounded and at the same time he is an adult.


Various legalized contracts are formed with the help of different terms and conditions and at the same time these terms and conditions provide the contract in a complete manner(Routledge-Cavendish., 2008). Before forming any contract, different kinds of statements must be created by one party for encouraging another party for entering into the contract. The parties who are includedinto the contractare assured along with its conditionsand terms.

  1. Face to Face- This kind of contract which gets communicated with the help of face to face conversation that is normally void and at the same time is not legal. For developing a contract of business it is essential to provide proper papers of the contract details(Elliott and Quinn, 2007). So, in the case of Peter Abraham, he needs to signify the right of this certain case as it is legally void. In the face to face contract formation, the parties are not able to take any legal action as it is not applicable because complete and perfect documental papers are basically omitted in the case of Mr. Peter.
  2. Written Contract-This kind of contract within which the parties who are included in the contracts forms a writing contract instead of oral contract, so those contracts are referred as written contracts. The written contract can be calculated as legally valid contract. The contract is described as a written contract while the contract is certified and presented to the advocate. A written is deliberated to be legal as the contract bears judiciary obligated(Stone, 2003). So, as per the case of Mr. Peter it is recommended that he can be able to create a written contract because this kind contract allowable to be safeguard from the contrary results of losses in business.
  3. Distance selling system- Under this system the contract can be created amongst the contractual individuals through different means like telephone, online internet and many of them. This means of contract can be able to form with telephonic communication and oral communication through internet online(Sweeney, O'Reilly and Coleman, 2010). This means of contract is basically same as face to face communication within which the contract is created with the help of telephonic interactions as well as with the help of oral interaction online(Young, 2010). And still this kind of contract is deliberated to be legally unlawful as it cannot form writtendocumental papers as well as it cannot give security regarding the situation of breach.

Condition- Under the matter of permitted association of the contract created that is deliberated like the quite important word in the support to the formulation of contract. In order to detain the impacts of the breach of a condition, it is essential for reflecting that breach of a condition that may convert into a simple aspect for losses(Taylor and Taylor, 2009). Under this case, the innocent individual has the legalized strength for terminating the contract and also rights in order to compensate legally for the surviving of injuries and losses due to breaches.

Warranty- The term warranty means the extra duty which are not very important portion of an agreement and it functions like a promise to the contract formulated(Treitel, 2003). Same as, the breach of condition, the breach of warranty allows the innocent person in order to claim for the compensation under the legal ways and the rights in order to lapse the contract is not permitted.

Innominate Terms- In order to deliberating legal inference of contract an innominate word is represented which is not connected along with the word condition as well as it is not aligned to the word warranty into the contract(Cornford, 2008). In order to claim compensation is actually allowed within this matter but it is contingent on the effects formulated through a breach.

Exemption Clauses- As per the English Contract Law and rules, the implementation of the clauses that are single is dissimilar under this matter and the inclusive persons have controlled regulation from carrying the duties of the contract(Willmott, Christensen and Butler, 2005). The single clauses are extended under two characteristics like true exclusion as well as partial clause.

Task 2



Case 1 Agreement

An agreement is the form of contract that is enforceable by law. It creates obligations that are permissible within the section of contract law. The basic elements that are required for the formation of a contract are mutual consent, consideration, capability and legalization. A lawful agreement is the set of promise between the two parties that is permissible within the jurisdiction of contract law. It begins with an offer which is the willingness to contract on certain terms(Willmott, Christensen and Butler, 2005). After that acceptance of the offer comes, this provides the basis of the agreement. To be effective under the terms of English contract law, a proposed offer must be communicated with the other party. There is no acceptance of offer without having knowledge about it.

            From the above study of agreement and from the situation provided in the case 1, it can be said that it is a reflection of treat. In law, any form of proposed invitation of a product or a service is considered as treat that is for persuading the customers to buy the products(Burrows, 2011). Carol, in the case scenario has made an approach to the proposal, so she can be considered as an offeree. On the other hand, the vendor who has proposed the treat can be considered as an offeror. As for formation of a valid contract, a written document is required, this case can be considered as void. Furthermore, the mutual consent of both the parties was also missing in the given case scenario. So from the definition of agreement and from the examination of the given case situation, it can be outlined that, there is no formation of agreement. The best illustration for the scenario of this case would be the case of Partridge versus Crittenden (1968).   

Unit 5 Assignment on Contract law Business

Case 2 Consideration

In business contract law, a consideration is the basis on which the contract is formed. It is the stage due to which parties comes to form a contract. Considered is termed as the bargain of the contract under the contract law(Casebrief.me, 2016). As a contract is formed due to the exchange of promises between a promisor and a promise, they must incur a benefit and suffer some detriment. This detriment is termed as consideration. For a consideration to be lawful, it must have some value before the eyes of the law and must be proposed for a present offer. A consideration must not be made in past and need to move from the promise.

From the above definition of consideration and from the examination of the case 2, it can be identified that consideration made in case has become a consideration made in the past and is not permissible. Devi has offered a sum to George, the IT Company owner, to hire his son Preston for the job. But the Preston was hired by the company before the George could make an acceptance to the offer. The offer proposed by Devi has become a promise made in the past and now does not exist validly. Under this case, the consideration proposed foe the formation of the contract can be termed as the ability to alter the settlement into negotiation. The other important element that is missing in the given case is the mutual consent of both the parties at the time of formation of agreement(Austen-Baker, 2011). Thus George cannot legally impose Devi to pay the proposed amount. The best example for this case would be the case of Roscorla vs. Thomas (1842) re McArdle (1951).          


Case 3 Exclusion Clause

Exclusion clause is the provision under the contract law in which one party’s liability is executed in the defined conditions, circumstances, or situations. Under exclusion clause, the one party to the contract cannot be made responsible for certain happenings(Netk.net.au, 2016). The exclusion clause cannot be tacked on after the contract has been made. If there is a signed contract containing the clause, then there will be an effect of inclosing it. Other important thing that is necessary for the exclusion clause is that it has to be legal. In exclusion clause, there is generally not a covariance of the breach that occurs outside the terms of the contract.

            Thus from the above understanding and from the scenario proposed in case 3, it can be conveyed that the specific case comes under the section of exclusion clause of contract law. The two parties that are engaged in the case are the couple and the owner of the restaurant. It can be found that there is no presence of communication between the porter and the couple regarding the liability of the materials into the restaurant. The porter had only delivered acknowledgement apparel regarding the liability issues without being getting involved into a communication or message. Other important thing is the absence of the message or communication regarding the acknowledgement apparel with the couple. The owner, thus, cannot rely on the exclusion clause that is contained in the receipt. The best parallel illustration for the given case is the case of Thompson versus Shoe Lane Parking (1970).           

Case 4 Implied terms

Implied terms in contract law are the items that a court will assume to be included in a contract, even though these terms are not expressly stated(Smith, 2011). People engaged in a small businessare generally doing not want to get relied on the court’s interpretation of the implied terms. Implied terms can be defined as the legal substitute of the contract defined by the court. From the description provided in the case 4 of implied terms, it can be identified that Aaron and Zehphra are two parties that formed the contract. The contract was formed between them with the mutual consent and understanding. But unfortunately, the contract was terminated due to the sudden death of Zehphra. Yeti, the daughter of Zehphra, terminated the contract with Aaron also proposed top increase the rent within the time frame mentioned in the contract which was against the terms of the formed contract. As the contract was terminated, Aaron was get to compensation for his expenditure on the borrowed items. Aaron can privilege compensation on the permitted main beliefs of implied terms. The best illustration for the given description of the case would be the case of Liverpool City Council vs. Irwin (1977).           


Case 5

It can be learned from the description provided in the case given scenario that the policy holder has not gained the awaiting past theft privilege. From the understanding of the given case scenario, the insurer who is involved in the case has no authority to reject the current policy due to the awaiting theft compensation of a past policy(Cooke, 2009). It is also important to mention here that policy holder who has applied for the motor insurance has not produced any incorrect information to the insurer as the terms and conditions of any past policy cannot be imposed on any present or current policy. Furthermore, it is necessary to mention some key elements related to a voidable contract for assisting the given case scenario. In a voidable contract, the innocent party has the right to impose the agreement but the agreement can be imposed on the innocent party. It is also important to mention here that in attendance of conditions in which the parties are involved should consider the consideration as the contract made is void(E-lawresources.co.uk, 2016). Thus, it can be stated that insurer can legally terminate the current policy due to the fact that policy holder present him incorrect information according to his terms.         

Case 6

It can be identified from the given case scenario that the engaged policy holder has produced incorrect information about the car description and the other previous policy insurance. The policy holder has produced incorrect information about the modifications done in the car, which enabled the insurer to gain a right to terminate the contract(Legislation.gov.uk, 2016). It can rightly measure that the information provided is due to an error, but it doesn’t create limitation to the insurer to gain the right to terminate the contract. The after reviewing all the scenarios of the case, it can be measured that the insurer has gained a position of legal right to terminate or continue the contract. It is important here to mention that a mistake cannot be presented as a defense in the contract. In addition to this, a fault always creates obstacles in having the mutual consent between the parties and thus makes the contract void.

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Task 3



Tort is basically deliberated for developing under a condition where a person opposes the duties of rules and laws and at the same time distresses the freedom of other persons. Tort is considered as legalized responsibilities of person according to the English Contract Laws. The liability of an individual develops under the tort rudiments, when an individual breaches the condition convey in the contract. When the breach forms then that individual falls under the liability of the contract that is actually according to the agreement of the suffering person(Schmerler, 2008). Under the illegal deliberation of persons inclusive under the contract, opposed is punishable under the legal words and the individual who suffers can be able to conduct the compensation. Each and every liability that is discussed in the rudiments of tort is actually depends on the liability for disappointment to practice the duties bound through laws. For illustration- if Mr. N formulates a contract for buying a television from Ms. P at $ 5000, and if Ms. P fails to give the goods in the provide time then she eventually becomes a contractual liable person. And if Mr. N fails to provide the whole payments in the provide time the he eventually becomes viable to Ms. P. Mr. N has the accountability in order to regulate the transportation vehicle as if his employers andlaborsdoes not performs their duties, the he will responsible for the liability of tort.


Negligence under the business laws of contract is conveyed as a situation where a responsible person is not enabled for perform the work that he must have to perform it. It happens when the person are not able to operate and functions his duties for any reason(McLean, Mason and McLean, 2004). As per the principles of tort, if any person is inclusive in functions any kind of harmful activities in his duties then it can be termed as negligence. Mainly there arefourkinds of features that are necessary for being deliberated in the tort of negligence.

  • Firstly:the offended must have some responsibility to another party.
  • Secondly:the offended should fails in few paths to integrity the responsibility.
  • Thirdly:the requester should survive few type of injury
  • Fourthly:a reasonable individual requires imagining the offender’s breakdown                              

Sympathetic liability or vicarious liability is generally the liability of person which is termed to be as principle for the operation of tort of other person as well as the person performs on the principle are termed as negotiator. This is the condition of industries on which a person can control under the liability for the missing of the activities achieved by the other individual. Vicarious liability or sympathetic liability is basically the duty of the negotiator for the answerable person. For illustration, if any manufacturers of goods and services of the organization measures at the time of driving and at that moment hit anyone then in the matter the driver and at the same time the owner of the organization are answerable to providing the compensation to the damages and losses of the victim. It occurs for the torts of liability of the other individual as well as represents largely because of the association of the individuals involved.

Task 4



Case 7

1)With the help of description in this certain case, it is most essential that fundamentals as well as the conclusion of a tort in negligence and the outcomes during the period while somebody not admires his duties of security and safeguard. Under this case, Mr. Brown was the victim person that shows that he survived the outcomes in the very next day at the time of treatment is going on. The expiry of the victim person occurs because of the negativeimpacts of toxics through his house. But still particular features of the case are concerned; his widow can accuse the hospital managerial departmentsfor the expiry of Mr. Brown. As assuming a state of facts where the expiry of Mr. Brown occurred during the period of admitting him to the hospitals, Mrs. Brown can blame the hospital for the compensations.

2) It is evident that death of Mr. Brown happened due to the presence of toxic material his home. It cannot be termed that the doctor and the nurse have not performed their duties. They have provided medication to the patient as soon as they heard the symptoms of the patients. It can also be identified that medication was provided by the hospital proved by the fact that the doctor has prescribed the nurse to provide medicine to the patient. Thus, they have legally performed their respective duties.


Case 8

On the basis of the English Contract Law, the legalized implications of sympathetic or vicarious liability are allowing for verifying the given case, this certain case reflects the large major negligence at the moment of the responsibility thus the guiltless person suffered losses can claim lawful compensation form the organization for that the chauffeur performed and labored for(Lindemann, Kadue and Lindemann, 2012). The guiltless person has the legal potentiality as well as power in order to claim the compensation form the organization because the injuries happens at the moment of duty functioned for the organization. Thus, the injured person of sympatheticliability can demand lawful compensation form the organization for the damages on the basis of Civil Liability Act 1978.

Case 9

On the basis of the English Contract Law, the legal implication of sympathetic liability in the condition of opposition of negligence it is necessary for considering that sympathetic liability is not allowed for executing in a particular firm if any workplace atmosphere safe and health and safety issues have been sympathetic to another firm(The Law Handbook, 2015). Through the help of deliberation the case broadly observed which the injured person faces the losses within the supermarkets as well as yet he is not allowed in order to hold the supermarket proprietor directly for the damages suffered by the injured person as the owner of the supermarket hasallotted the labors safeguard to the another enterprise before.


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