However, when Freddy arrived he found that there was only a selection of 35 records available. He there upon informed Richard, the manager of the Red Lion, that he could not perform under these circumstances and left the pub immediately.
Richard was furious, he told Bill to leave the equipment set up and began telephoning around to find another DJ. He eventually found a DJ called Sally who agreed to perform at that Red Lion for £150-00. Richard agreed to pay this fee; but when she arrived she found that Bill had taken down all the equipment and had gone home shortly having done so. Richard was forced to pay two local boys £35 each to set up the equipment for Sally.
Freddy and Bill are demanding their fees of £60 and £20 from the Red Lion Club. Richard has refused to pay them and is threatening legal action by the Red Lion which is an incorporated company against Freddy for Breach of Contract.
In the above, it is necessary to discuss whether either party can sustain a claim for breach of contract. In order to do this it is necessary to discuss the formation of a contract and the issue of privity of contract with regard to any potential claim Bill might have. From this is should be possible to advise the parties with regard to any monies they might be entitled to.
The formation of a contract requires there to be an offer1, followed by acceptance2, and then consideration. If all three elements are present the court will generally rule that the contract has been fully constituted. In the above, the contract has been created between Richard and Freddy, with Freddy offering the services of Bill to assemble the equipment, and Richard acting on behalf of the Red Lion Club.
When considering privity of contract it is important to note in this case that privity exists between Richard and Freddy. Privity can be horizontal or vertical. Horizontal privity would occur in the case of Bill as he will be getting the benefits from the contract made between