English Contract Law - Essay Example

Swarna Word count: 2498 ID 5448 Order # 144058 10th December 2006. Contract Law The buyer (the individual or organization who buys or agrees to buy the Goods from the Seller) has the option to appeal this case in English court of law because in any contract (a promise or set of promises which the law will enforce (Pollock, 1952)) made between two persons or parties even though it is mainly intended to provide for stream lining and convenient mechanism of transaction but is governed ultimately by English contract law. By anticipating the possible consequences arising out of ill intentions of one of the parties, the framers of English contract law have included several clauses so that any specific situation will be easily fitted in to the case and solution will be provided by the judges after going through all the deliberations. In the present case study, it is clearly apparent that seller (The individual or organization who sells the goods to buyer) has violated the contract law provisions. The contract law states that once the agreement was made, the terms and conditions should be accurately followed with minor exceptions only with sufficient justification. Hence the buyer (on behalf of Buyer Ltd. : Tom) should file a case in the court of law to get the justice. The violation of contract law was clearly committed by the seller (on behalf of Seller Ltd. : Max) with ill intention of charging extra money of £2800. The case can be filed against the seller as it violated both English contract law and unfair contract terms act (1977). This has been found to be in violation with the principles of European contract law (Ole Lando et al., 2003 ; The commission on European conract law, 1999) . False representation or misrepresentation may be considered as serious offence as it affects the interests of the general public involved in trade transactions severely. The seller has been indulged in false representation in claiming his bill amount for the hydraulic jack system. The English contract law also clearly prohibits the actions relating to the breach of contract (Samuel Williston, 1903). It was also found to be against the fair trading and hence comes under unfair contract terms act (1977) 1. This helps in narrowing the gap between the classic theory of contract law and social reality and hence found to be effective in providing justice to the innocent clients (Hugh Beal, 1978 ; Friedmann, 1972). The violation of terms and conditions signed at the time of contract is legally punishable and hence the parties have to bind themselves to the contract strictly 2. The buyer has to proceed to the court seeking the justice as he has fair chance of winning the same. It is mainly because of the following main points. 1) The seller has agreed to supply the goods at the rate or price quoted in the seller’s brochure at the time of contract between the two parties (in violation with sale of goods act, 1979) which he could not maintain through out the transaction. It is a severe mistake committed by him which is highly objectionable under English contract law. 2) Even though the exceptional clause was provided, it was given in small letters with out much focus which 1 : http://www.lawteacher.net/Contract/UCTA%201977.htm 2 : L.Estrange V Graucob, 1934, 2 K.B. 394. supports his ill intention of non transparency which if proved is highly punishable under contract law of England. This comes under manipulating th original substance of truth for the selfish reasons. 3) The buyer’s terms and conditions which were declared with clarity indicated about the condition that the price at the time of contract has to be constant. Once the order is submitted, no question of further modification which was agreed upon by the seller (in violation with the principles of European contract law). Had he got any objection, he would have recorded at the time of contract it self. 4) Most important point is that the seller agreed to supply the goods on 31st August 2006 which could not be implemented. Rather it was delayed by 6 days which can be objectionable from the buyer side. Even he can ask for the more compensation for additional time taken for the supply of the goods. Hence the buyer is advised to file a judicial civil case against the seller mentioning the grounds under which the seller can be punished if he does not agree to settle the transaction with the actual price of machine quoted at the time of the contract. (in violation with English contract law and unfair contract terms act, 1977) The close analysis of previous cases was also in support of buyer’s case. For example, the judgment in case of Butler Machine Tool v Ex-Cell-O Corporation (1979)3 was in favor of buyer as the terms and aconditions were closely studied and seller had violated the terms which affected the interests of the customer or buyer. The battle of words in the form of terms and conditions operate in these types of cases and the judgment needs full study of all the documents and follow up actions taken by both the parties. Once the similar analysis is made in the present case, the buyer would certainly get full justice in his favor. Hence the buyer is strongly recommended to proceed to the court in his jurisdiction. Moreover, it is definitely against the principles of contract law which states that a valid contract requires: (a) an agreement; (b) an intention to create legal relations; and (c) consideration. All the three requirements have to be monitored along with the follow up actions from both parties. The agreement is very much reflected in placing the order by filling up the company’s order 3: http://www.lawteacher.net/Contract/Agreement/Agreement%20Cases.htm form by buyer and regular correspondence between buyer and seller. The buyer would get justice as the intention of seller to create the fair legal relations was absent and which can be proved in a court of law. The buyer is suggested to collect the documents of corresondence systematically for submitting the same to the court of law. The attitude of seller is completely against the Sale of goods act (1979). This Act applies to contracts of sale of goods made on or after 1st January 1894 4. Hence the buyer can claim the violation of this act and accordingly seek the justice. The buyer should concentrate much on clause 8 of sale of goods act (1979) which describes about ascertainment of price of goods. It states that the price in a contract of sale may be fixed by the contract, or may be left to be fixed in a manner agreed by the contract, or may be determined by the course of dealing between the parties. 4 : sale of goods act (1979). http://www.lawteacher.net/Contract/SGA%201979%201.htm. Where the price is not determined as mentioned above the buyer must pay a reasonable price. Similarly it also emphasizes that the reasonable price is a question of fact dependent on the circumstances of each particular case. In all the points mentioned here, the terms and conditions are in favor of buyer if the representation is made logically. The price was predetermined as it was displayed on company’s brochure and hence the seller has to bind strictly to the terms and conditions which would result in favor of buyer. Moreover the seller did not raise any objection regarding the conditions of buyer supplied to him at the time of initial correspondence. The contract law clearly states that once the buyer or seller doesn’t satisfy with the conditions of the contract, they can object the same before the delivery of goods is given effect. Here in this case, the seller didn’t give any indication of having objection with any terms and conditions placed in Buyer’s form. Hence he expected to follow the terms including the price. The clause 9 of sale of goods act (1979) also has to be stressed upon by the buyer which explains about agreement to sell at valuation. It states that where there is an agreement to sell goods on the terms that the price is to be fixed by the valuation of a third party, and he cannot or does not make the valuation, the agreement is avoided; but if the goods or any part of them have been delivered to and appropriated by the buyer he must pay a reasonable price for them. Similarly in a contract of sale, "month" prima facie means calendar month and the delay of 6 days for delivery of hydraulic jack system in this case also resulted in change of new month which can be built as a strong point of defense for the buyer. There were several other provisions in the sale of goods act (1979) which can be pointed out for breaching the terms of the contract and the buyer should make a strong argument with the same. As mentioned earlier, the buyer has a sound chance of representing his cause under unfair contract terms act of 1977. Several authors quoted the cases involving violation of the unfair contracts terms act of 1977 5 &6. The part I of 5 : Robert Bradgate, 1997. EU directive on direct selling. http://webjcli.ncl.ac.uk/1997/issue4/bradgat4.html. 6. Elizabeth Mac Donald and David Poyton. 2000, A particular problem for e-commerce: section 3 of unfair contract terms act 1977, http://webjcli.ncl.ac.uk/2000/issue3/macdonald3.html. this act clearly defines the negligence on part of any party as the breach of (a) any obligation, arising from the express or implied terms of a contract, to take reasonable care or exercise reasonable skill in the performance of the contract; and (b) any common law duty to take reasonable care or exercise reasonable skill. The seller has certainly exhibited negligence or breach of contract and can be prosecuted for getting the justice for buyer. Whether the seller has violated the terms of the contract intentionally or inadvertently, once it is proved legally, he may be punished and the buyer would get the compensation. The buyer is advised to refer to the cases where contract laws have been violated 7&8. 7. Alexander v Rolls royce motor cars ltd Damages - breach of contract-contract to repair motor car-claim for damages for distress, http://www.lawteacher.net/cases/cont9.htm/file-21.html. 8. Cadogan v Escada ag . Landlord and tenant - rent - review - review clause - physical composition of premises to be valued - construction of clause. http://www.lawteacher.net/cases/cont11.htm/file-9.html. The unfair contract terms act also emphasizes that in relation to any breach of duty or obligation, it is immaterial for any purpose of this Part of this Act whether the breach was inadvertent or intentional, or whether liability for it arises directly or vicariously. The cases reported to be in violation with law of contract in different contexts may also be useful in developing better understanding about English contract law 9&10.  Seller is surely involved with violation of legal principles of contract law and buyer may have to concentrate on some of the specific clauses as mentioned here: 9. Harvey v Perry. Contract - formation of contract - offer and acceptance - agreements contemplating execution of more formal document - whether binding contract - stipulation for formal contract. http://www.lawteacher.net/cases/cont15.htm/file-62.html 10. Kruse v Guestier & co ltd. Arbitration - reference to arbitration - arbitration agreements - scope of arbitration agreement - revocation or termination of agreement - by operation of law - other cases – frustration. http://www.lawteacher.net/cases/cont9.htm/file-88.html. (a) section 12 of the Sale of Goods Act 1979. (b) section 8 of the Supply of Goods (Implied Terms) Act 1973 . (c) section 9, 10 or 11 of the 1973 Act (relating to hire-purchase), cannot be excluded or restricted by reference to any contract term. The principle of reasonableness has been found violated by the seller which is to be proved by the buyer logically to get back his compensation. The test of reasonableness will certainly decide the outcome of the case in favor of buyer. The relevance of reasonableness in solving neglected legal cases was also reported by Richard W.Right (2002). Hence the buyer should take advantage of this principle of reasonableness. The unfair contract terms act (1979) states that in relation to a contract term, the requirement of reasonableness for the purposes of this part of this act is to be met. similarly section 3 of the Misrepresentation Act 1967 clarifies that the term should be a fair and reasonable one to be included having regard to the circumstances which were, or ought reasonably to have been, known to or in the contemplation of the parties when the contract was made. In this context, the seller has intentionally tried for misrepresentation which is in clear violation of principles of English contract law and buyer may concentrate on this point.  Similarly the principles of European contract law and international commerce laws have to be interpreted well by the buyer before construction of case for best judgment of contract law related cases (Ewan Mc Kendrick a, 2005). Alan Taylor et al, (2004), Adams and Brownsword (2000) and Ewan Mc Kendrick b (2005) also contributed significantly for efficient educational program on contract laws. The buyer is strongly advised to refer their literary / legal publications or books before construction of case against the seller. Last but not the least, the buyer may also explore the possibility of solving this issue by direct negotiation with seller quoting all his arguments, in case the seller gets convinced, the court case can be avoided which saves lot of time, money and resources.  Bibliography : Adams,J.N. & Brownsword,R. (2000), Understanding contract law, Sweet and Maxwell publication, P:288. ISBN : 0421858508. Alan Taylor, Linda Mulcahy & John Tillotson. (2004), Contract law in perspective, Routledge Cavendish publication, P:304. ISBN: 185941771X. Anna Veneziano & Luisa Antoniolli, (2005), Principles of european contract law and italian law, Kluwer Law international publication, P: 520. ISBN: 9041123725. Chris Turner. (2005), Contract law (Key facts law), Hodder Arnold publication, P: 160.ISBN: 0340889497. Danny Busch. (2005), Indirect representation in European contract law (Principles of European contract law), Kluwer Law international publication, P; 428. ISBN: 9041123423. Ewan Mc Kendrick a. (2005), Contract law, Palgrave Mcmilan publication, P:512. ISBN : 1403948690. Ewan Mc Kendrick b. (2005), Contract law : text, cases and materials, Oxford University Press publication, P: 313. ISBN : 0199274800. Friedmann,W. (1972), Law in a changing society, (Penguin Books, 2nd edition, Harmondsworth), 4th chapter. Hugh Beale. (1978), Unfair Contract Terms Act 1977, British Journal of Law and Society, Vol. 5, No. 1, pp. 114-121. Ole Lando, Eric Clive, Andre Prum, Reinhard Zimmerman (2003), principles of European contract law. Part 3, Kluwer Law international publication. P:352. ISBN: 9041119612. Pollock, (1952). Principles of Contract (13th Edn, London). Richard. W. Wright. (2002), Justice and Reasonable Care in Negligence Law, American Journal of Jurisprudence, Vol. 47, p. 143. Samuel Williston. (1903), Rescission for Breach of Warranty, Harvard Law Review, Vol. 16, No. 7 , pp. 465-475. The commission on European contract law. 1999, Principles of European contract law. Part 1 &2, Brill publication, P:512.ISBN: 9041113053. Read More