Unit 5 Various Elements & Laws of Contract Assignment

Unit 5 Various Elements & Laws of Contract Assignment

Introduction

A contract is an agreement in which two parties agrees on the same fact and indulges in the arrangement for the exchange of the promises which helps in gaining the end of the contract. Arrangements for the compensation must be presented in the form of consideration to receive something of value by both the parties. Aim of the Unit 5 Various Elements & Laws of Contract Assignment is to provide effective set of knowledge regarding various elements of contract law and law of contract. In this assignment the remedies are analyzed and evaluated and information regarding various aspects of law and breach of law will be discussed in the assignment so that effective set of knowledge and information could be provided.

Task 1

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.

Following are some important elements of contracts:

• Offer: An offer is an expression provided to the party so that it could enter into the contract for a specific term. An offer can be provided from the offeror and have the intent to enter into a contact. There are several types of offer like invitation to offer and counter offer. To determine the nature of contract it is necessary that the offer shall be express and clear in understanding (Richards, 2006). A negotiated offer is regarded as a counter offer which exchanges the place of the offer and offeree. After occurrence of each offer previous offer is rendered to be invalid.
• Acceptance: When an offeror present the offer to offeree and he accepts the terms presented by the offeror then it would be regarded as the acceptance. There are various modes through which offer can be concluded they are acceptance, rejection, withdrawal, counter offer and death. At the time of acceptance it is necessary that it should be clear and precise in nature (Giliker, 2010). It is necessary that the while communicating the acceptance it should be waived off under the contracts that are made to the world. The contract which is being accepted by the party should be accepted through a proper set of conduct and not merely by communicating the acceptance. Discussed under the case of Carlill v Carbolic Smoke Ball Co.
• Consideration: It is a situation when a contract is entered into a bargain. When two parties bargain on one factor that bargaining is considered as a consideration in which promises are exchanged by both the parties. There are certain set of benefits that are received by each party and suffers a determent. A consideration will be termed as valid if it would not be of past, should be sufficient and should move from promissee. The consideration made should not be part of existing consideration, or any contractual duty in which part payment will not be termed as valid for the payment of entire consideration (Bell, 2013).
• Intention: Purpose of the contract expressed by the intent to offer is known as intention. Legality of the contract is derived by the intention in a prescribed situation. Through the legality and enforceability of the contract intention is differentiated between the social and commercial contracts. For commercial contract it is necessary that it would be enforceable under law but in social it is not enforceable in law unless it is provided so.
• Capacity: With the help of capacity of contract, capacity of the party is determine so as to enter into the contract. There are various ways on the basis of which capacity of a party is tested such as financial status of a party, mental status of the party and the age of a party entering into the contract. It is necessary that the entering party should e financially sound, should be mentally sane, and should be of majority of age. Party entering into the contract should be in a conscious state, it should not be influenced by alcohol or by any medication (TAN, 2008).

1.2 Discuss the impact of forming contracts

• Face to face contracts: Face to face contract is a contract in which both the parties are available and enter into the contract in front of each other. In this type of contract usually both the parties sit across each other while entering into the contract. All the terms and conditions related with the contract are discussed and expressed to each other. Face to face contracts could be entered in a quick manner and are usually in a verbal form. Verbal contract are difficult to be claimed in the court of law. Face to face contracts are the time saving contracts.
• Written Contract: The contracts which are entered by the parties in the written form are known as written contracts. In this type of contract it is not necessary that the face to face interaction should occur while entering into the contract. Generally price are expressed in the written contracts at which it is being entered into which defines its nature (Vettori, 2007). These types of contracts could be expressed and are easy to present in the court of law as contract in the written form could be presented as evidence.
• Distance Selling Contracts: distance selling contracts are the contracts in which parties from different places are entered. These are the contracts in which meeting or discussions are not required. Distance selling contract could take place from fair distance according to the will of the party to enter into the contract. Online selling is one of the examples of distance selling contract. It is necessary that this type of contract should clearly mention various things such as contract details, taxes applicable, price of the product, description of the goods and services, methods of delivering the product, etc. Such type of contracts is regulated under Distance Selling Regulations, 2000. To place an order it is necessary that acknowledgement receipts shall be provided and language choices shall be availed for the production of contracts (Giliker, 2010).

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: There are several terms that are important for the contract these terms are known as condition of the contract. It is necessary that all the conditions should be performed essentially as any non performance would lead in voiding the contract. There are several conditions that are to be performed at several stages like condition precedent, condition concurrent and condition subsequent.
• Warranty: There are several terms that are secondary in nature and are regarded as warranty. For a contract warranty is important but non performance of it does not affect the contract. Non performance of the contract does not lead to revoke of the contract. Through the claim of damages, specific performance and injunction warranty can be restored. Different type of warranties are depend upon their nature that can be full warranty, life warranty, specific warranty and implied warranty which can be implied in law (Collins, 2008).
• Innominate term: The terms that may or may not be termed as a condition or a warranty are regarded as innominate terms. The terms are classified according to their effect on the non performance under the contract. In some type of contract innominate terms, conditions may be termed as warranty depending upon the contract and warranty may be termed as condition in innominate terms. Remedies related with the non performance are thereby discussed whicha re based on the type of term that is breached.
• Exemption Clause: Exemption clause are the clause which essentially restricts the liability or the claim that are to be made under certain situation. To enforce it is necessary that the exemption clause has to be included in a proper manner. Exemption clause can be constructed in several manners like strict or narrow interpretation, contra proferentem, or fundamental breaches. To include them it is necessary that signatures, notices or previous dealings between the parties must be presented. It is necessary that the opportunity to object the clause must be provided. There are several limitations that limit the remedies for the breach of a  contract formation.

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Task 2

2.1: Apply the elements of contract in the given business scenarios below.

Case 1: The case is presented in which an advertisement of a couch was done and Carol a customer was interested in purchasing that couch. Therefore, it cannot be said that the advertisement presented in the newspaper was an offer but it could be said as an invitation to the offer. Posted advertisement in the newspaper means that seller wants to attract the offers from the potential buyers present in the market so that they can purchase the advertised good (Morgan, 2011). Invitation to offer is an indication that the goods are available for sale in the market in which terms related to the price are presented. In such a case an offeree can either directly accept the offer or can negotiate with the offeror. Hence, the email that was sent by Carol could be termed as an offer made by her. Therefore, it could be said that parties are not entering into any contract. Case discussed in Carlill v Carbolic Smoke Ball Co.

Case 2: Case presented hers is about Devi who wanted a position in the field of cyber-security with a company named George Smith and Fogarty Inc. In this case Devi did not want that any interference of his dad in the matter. After giving the interview Devi was hired on 12^th April as company provided him the offer for the same position. On 13^th of June unknowing the fact Devi’s father offered the company an amount of 150,000 Pounds so that company could offer the position to Devi. In such case the consideration made will be termed as invalid as the event for which the consideration is made has already been occurred (Vettori, 2007). Therefore George could not enforce the action that has already taken place as past considerations are termed as invalid. Case discussed under Mills v Wyman.

2.2: Apply the law on terms in the following contracts

Case 3: In the case discussion regarding the couple who had booked a table in a restaurant had taken place. At the entrance of the restaurant coat was checked and while checking the coat men forgot his wallet into it. While the coat was checked at the entrance a slip was provided to the men in which it was mentioned that the hotel will not be responsible for the valuables in the coat, it was mentioned that the restaurant will not be responsible for any theft or missing of any items present in coat. After dinner man has discovered that he had forgotten the purse in his coat and went to the checkpoint to have a check in his coat but unable to find his wallet in his coat. Therefore, mean wants the claim from the hotel. It could be analyzed that the exclusion clause presented in the slip provided by the restaurant restricts any claim made by the person in such cases. Accepting the slip was an acceptance shown by the man in employee relation with the exclusion clause. Managing any theft is not possible for the restaurant to manage it as it is not a service that is being provided by the restaurant. Therefore claim made by a man regarding the theft of the purse will not be termed as valid as the exclusion clause made by the restaurant will restrict any claims. Case discussed under L’Estrange v Graucob (Meyer, 2010).

Case 4: Case will include the discussion regarding the tenant that has made the warehouse into a usable condition by carrying out a repair work in that warehouse. In this case landlord has agreed not to increase the rent for next five years. After some time tenant of the tenancy died and the successor increased the rent. After refusal by the tenant successor terminated the tenancy. Therefore tenant has posted the claim for the repair work made by him for which the new tenant entered in the tenancy has refused to pay. The charges increased by the tenant are due to increase in the value of property by the repair work made by tenant. According to the tenancy act it is necessary that the tenancy should compensate the tenant for the repair work made by it and it is necessary that it should let him live peacefully in accommodation. According to the standard contract that the tenant should claim for the spent amount on the repair work from the landlord. It is necessary because the landlord would reap benefits from the repairs for the life thereby. Case discussed under Hutton v Warren (Cooke, 2007).

2.3: Evaluate the effect of different terms in the given scenario.

Case 5: In this case the discussion regarding policy holder is taken into consideration in which Policy Company has provided the form related with the claim. The question was whether the owner had applied for any claim related with the motor vehicle in past. For this question policy holder had marked the answer as No. After investigation it was found by the Policy Company that in previous five years policy holder had made the claim for the theft of his motor vehicle. These types of terms made on the policy forms would be considered as condition (Giliker, 2010). As the insurance policy terms presented in it are subjective to the motor vehicle and the term occurred was same therefore, it would be categorized as an essential term without it the contract would lose its purpose. In such case insurance company could void the contract. Case discussed under Poussards v Spiers.

 Case 6: In this case the policy holder had refused to the fact that it had made any claim for theft or modification in previous five years. With the investigation regarding the claim it was found that there were two claims made by the policy holders in previous years in which one claim was made for the theft of the motor vehicle, and another claim was not known by the owner of the motor vehicle. It was also investigated that the parts of the motor vehicle were replaced by the policy owner (Adams, 2008). In such case the term in question is regarded for the replacement of the parts of the motor vehicle would be breached but could not be used as sufficiently enough because it was made by the policy holder fir which it was best in his knowledge. Therefore it could be said that no breach had taken place. On the other hand wife was having the knowledge regarding the claim applied but she rejected it and had not mentioned it in the form. Therefore, in such case the policy holder has committed misrepresentation which will considered as the misrepresentation of the condition. In both the cases breaches made are not sufficient and are not enough to void the contract. Case discussed under Bissat v Wilkinson (Andrews, 2011).

Task 3

3.1: Explain the similarities and differences of liability in tort with contractual liability using an example.

The only similarity between the liability under law of tort and the law of contract is that both the liabilities are strict in nature. The liability which arises with both the laws is the acceptance of the responsibility for a consideration. The liability will occur when the performance is accepted and undertaken voluntarily by the parties. Liabilities under the two aspects will arise and will be paid when the essential elements will be breached. Difference in both the liabilities is essential as the elements breached in both the cases are different but the liability that will arise will be similar in nature. In this case the party which is affected will have to just prove the breach which is occurred and the liability will arise (Giliker, 2010). Differences between both the liabilities are as follows:

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.

In certain situation liability is the pay that is to be made in relation with the harm under a certain situation. In such cases liability of negligence arises from the act of negligence in which the existing duties related with the care are avoided. This kind of duty of care exists against the society and it is essential that it is to be undertaken in general so as to protect the society from it. It is a liability under the tort. For the occurrence of liability the duty of care shall be breached and the damage so occurred should be directly attached with the duty that is neglected by the person. And the damage shall be classified as the economic, physical and psychological manner (Cooke, 2007). if in case a person drives recklessly on the road then the breach of duty of care will occur but the liability will only arise if in case the harm that occurred is due to the breach of that care.

Liability could be direct or indirect towards the party as discussed according to the Donoghue v Stevenson. It was established that the person which has claimed would be entitled to damage if his right has been breached either directly or indirectly. Instructions are provided to the manufacturer that he should pay attention towards the safety and security of the customers and the employees. It is necessary that the manufacturer should provide the product which is safe and secure to use (Collins, 2008). According the case of Caparo Industries plc v Dickman [1990] UKHL 2, a threefold test for the classification of tort of negligence is framed by the court which are as follows:

• Proximity and for accessibility: Proximity means that the wrongful act and its affect are within the approachable area.
• Causation: it is necessary that the cause of act and its affect shall be directly related.
• Remoteness of damage: It is necessary that the damage so occurred shall be sufficient so as to influence the damage so caused.

3.3: Explain what the vicarious liability means and how a business such as your organization can become vicariously liable giving example.

Vicarious liability is a liability in which responsibility for the act of another party under a given situation. In such case the responsibilities arises by delegating the responsibility by the primary party to the secondary party. This type of delegation should ensure that the primary party should get benefited. In this the performing party should get paid for the performance of the duty so assigned. This type of duty arises under employer and employee relationship. It is important to note that the liability will arise only in the case if any wrongful activity would take place while the duty is being performed which is assigned (Richards, 2006).

It is necessary that the employer should focus on the safety and security of the people working under it and it is necessary that it should maintain the health standards according to Health and Safety Act of 1974. It is necessary that the employer should use water and equipments according to the standards. It is necessary that the steps that every step should be communicated and safety measures should be provided to the employees working in the organization. Under the case of Ready Mix concrete (South East) V MPNI (1968) a test was formulated so as to have a check on whether the responsibility is formulated or not. According to the fact if an employee has more than one employer than the employer directly related with the situation will be responsible for the damages that were caused during the performance of duties (Andrews, 2011).

Task 4

4.1: Apply the elements of the tort of negligence and defenses in the given business scenarios below:

Case 7: In this case discussion has taken place in which doctor has prescribed over the counter medicines to the patient who was facing the issue of chest pains and breathing problems. After it the patient was found to be dead from pneumonia from toxic mould. According to the tort of negligence the doctor was found to neglect its duties by not examining the patient personally. It is necessary for a doctor that such kind of problems should be ignored by a doctor as chest pains could cause a heart attack. Therefore in such a case it could be said that doctor has committed a professional negligence (Cooke, 2007).

In this case “But-for test” will be applied. According to the case it could be said that the doctor had committed the negligence which was not a cause for the damage. But for test is a most common tests that is used under medical profession of negligence. In this case the reason and the cause of effect are not directly related with each other (TAN, 2008). In this case the patent died due to pneumonia and not because of heart attack. As doctor of Goodmayes Hospital had not prescribed the medicine for pneumonia therefore doctor will not be responsible for such a condition. Therefore, doctor will not be responsible for the liability. In this case doctor will only responsible for negligence made for not checking the patient but not for the damage caused to the patient. Case discussed under Froom v Butcher.

4.2: Apply the elements of vicarious liability in given business situations below:

Case 8: In this case the discussion is made regarding the driver who was assigned the duty of picking up the client from the airport. After reaching the airport driver discovered that flight in which client was coming was delayed so driver decided to have some drink. After the arrival of flight driver drove back the client from airport. While driving, driver was in drunken state due to which he met with an accident in which both car and client was damaged. With the investigation it was found that the driver was drunk and was found that it was a case of drink and drive. In this case driver has breached the regulation of drink and drive but as he was performing his duty of dropping the client therefore, the liability will be bear by the employer. This is the case of negligence of the duty and care for which the company will be liable. Case discussed under Lister v Hesley Hall Ltd (Morgan, 2011).

Case 9: This case will help in understanding the situation of occurrence of vicarious liability. This is a case of supermarket in which an accident took place. In this case the health and safety requirements of supermarket were outsourced by another company. According to the discussions held previously it can be evaluated that the responsibility and liability will be held with the direct and absolute employer. Therefore according to the vicarious liability the accident that took place in the business of supermarket liability will held with supermarket. The accident was occurred while loading the pallets into the truck in which pallets got slipped which damaged the employees. It was found that the breach of duty and negligence of the safety and security of the workplace was found in supermarket therefore, supermarket will be liable for the accident (Bell, 2013). Case discussed under ready Mix Concrete (South East) V MPNI (1968).

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Conclusion

Breach of contract could take place in the condition if the terms agreed by the parties under that contract are not performed. Non performance of any of the term would lead to breach of the contract. The breaches could be compensated by paying the party causing the breach. In this assignment the breaches under the law of contract and law under the law of tort are discussed. The damages caused and the parties responsible for the damage are analyzed and determined in the Unit 5 Various Elements & Laws of Contract Assignment. In this assignment the existence of a contractual duty or duty under law is presented. Concepts like vicarious liability and negligence are explained in the assignment.

References

Cases:
Carlill v Carbolic Smoke Ball Co.
Mills v Wyman
L’Estrange v Graucob
Hutton v Warren
Poussards v Spiers
Bisset v Wilkinson
Books:
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.

Aim of the Unit 5 Various Elements & Laws of Contract Assignment is to provide effective set of knowledge regarding various elements of contract law and law of contract, Locus  Assignment Help  posting units solutions so scholars can explore assignment help and get review the quality of our work.