Contract Law as Execution of Promises - Essay Example

?Business Law Table of Contents Part A 3 Question 3 Question 2 6 Part B 9 References 11 Part A Question Step Identification of the Legal IssueIn the provided case scenario, the major legal issue recognized is aspects of legal contract. Step 2: Explanation of the Law The contract is regarding execution of promises. Every promise cannot be imposed by courts. Thus in order to enforce a contract, certain components must be present. These components can help to make a legal contract1. All agreement and contract must be developed by free accord between parties capable to make contract for a legal consideration and with a legal object and are not hereby particularly acknowledged to be invalid. For claiming the business deal undertaken by Sally to be a contract, there must be four significant aspects which are: Offer and Acceptance: Any legal contract must have proper offer and acceptance where one party makes the offer and the other agrees to it. Offer is demarcated as an instance when one individual indicates the willingness to make a business deal. Offer is made by a party by considering the acceptance of other party. The true purpose of offer should be to make legal association2. An offer is an appearance of readiness to contract on specific terms. Offer must be made with the aim that will become obligatory on acceptance. Offer allows the party to approve it and delivers the base of agreement. Offer can exist when objective is involved in purchaser’s words or conduct i.e. intention to commit certain act lawfully to the terms the purchaser recommends3. Communication: Effective communication is a vital aspect for a business contract. The offeree should know regarding the offer. The communication should be developed or sanctioned by the offeror. The purchaser cannot approve to something which he/she has no knowledge. Accordingly, the seller should communicate the offer in an intended way4. Consideration: Consideration is essential for proving the validity of contract. Only an ordinary statement of agreement cannot develop a contract. Consideration is regarded as a promise to provide something and gain something in exchange of it5. Assurance: The conditions of contract which are involved in the offer should be clear enough so that they can provide sensible basis for defining the reality of breach in relation to the contract and thus help to enforce action. In terms of product sale, Uniform Commercial Code (UCC) provides criteria in several occasions such as price, time, location of delivery, or payment rules4. Step 3: Application of Law to the Fact In the context of the case study, the above aspects of a legal contract were missing. For instance, proper offer and acceptance was not made by the parties. Peter and Burt both had stated to Sally that they intend to purchase the bike. However, it differs from an offer because they did not reach an agreement with Sally that they will purchase the bike. The second essential element of contract i.e. proper communication was absent between Sally and the parties. Although Peter has offered a deal to Sally regarding purchasing of the bike, without his awareness the offer of Peter has been accepted by Sally which was her intentional communication for selling. Furthermore, communication should be made or certified by the offeror. With respect to mutual consideration, it can be observed that the contract had lack of consideration. Although Peter and Burt had specified that they expect to purchase the bike, they had not promised about purchasing. Ultimately, there was no assurance of parties about purchasing. Peter and Burt had not specified any time for purchase in the e-mail and Sally also did not approve any reasonable time for delivery of the bike to Peter. Without a reasonable time, offer cannot be measured as lawful. Step 4: Conclusion Judging from the above aspects, it can be observed that Sally has not made proper contract with any of them i.e. Peter and Burt. There was absence of communication, assurance and consideration. Besides, appropriate offer and acceptance from both the parties had not been made. Thus, Sally cannot claim her business as an enforceable contract with Peter and Burt. Question 2 Step 1: Identification of the Legal Issue The legal issue identified in the case is breach of contract with respect to terms and conditions. Step 2: Explanation of the Law The terms and the conditions are regarded as the subjects of a contract. Once a contract is established, there is need for statement regarding agreement about business transaction which is termed as “terms and conditions of a contract”8. These aspects are crucial as they can act as a promise on which parties can litigate for violation of terms in a contract. Terms and conditions describe the elements of business deal such as method of delivery, management of product delivered and method of product approval among others. Violations of these aspects permit the other party to terminate the contract or claim for any loss6. Before making a contract, numerous declarations are made to inspire or to convince a party to make the business deal. In later times, a dispute can appear regarding those declarations. Therefore, the terms and conditions should be considered before entering into a contract so that the parties are deemed to be bound by them, regardless of any previous declarations6. A contract can have different terms such as “conditions” and “warranties”. These are terms which must be understood and accepted by the parties while developing a contract. The word “conditions” is regarded as the obligations which are the key essentials or aims of a contract. On the other hand, a “warranty” denotes those obligations that are indemnity to the main aim (conditions) of the contract. The word “warranty” defines declarations of fact concerning significant aspects of business deal. The word “conditions” refer to liable situations for making contract7. Status of a term in contract is important in case a party seeks to take lawful action for non-completion of any term demonstrated in a contract. Only declarations which can aggregate to a term can make promised commitment on behalf of the parties. Conditions are a key aspect of contract and violation of conditions can result in termination of contract and claim for damages. On the other hand, warranties are not significant and violation of warranties only results in claim of damages8. Step 3: Application of Law to the Fact In case of Peter, he had entered into a contract with Sally about purchasing a bike on certain conditions where purchaser (i.e. Peter) was accountable for any kind of defect, breakdown or fault of the sold product. However, guarantee was given within one month time period after purchase. As a result, Sally is bound with these terms. In order to take legal action on Sally, there must be violation of terms. It can be observed that according to advertisement presented by Sally, the tyres of bike were refurbished and chain was new. However, the color and seat of the bike mentioned in advertisement did not fulfill the criteria. Thus, it was a misrepresentation of warranty where Sally has not conformed to the information provided in the advertisement. With respect to warranty, there was no breach of term because the bike became useless after six months which was beyond the prescribed limit of contract. Step 4: Conclusion Whether the terms are warranty or condition, it relies on aim of parties. From the above analysis, it can be observed that there was breach of faith on the side of Sally while making the contract. In this case, Sally had made announcement and generated a promised obligation. Although she had misrepresented the content of the product to a certain extent, the declaration of contract made with Peter cannot assure the violation of term. Thus, there is no pledged obligation on the side of Sally with respect to terms and conditions. However, the case is an offence of misrepresentation where Peter can claim damage on his bike. Besides, the conditions imposed by Sally about the liabilities over Peter are also unfair. Part B Parliament is the body in every country which creates the laws. It is the duty of the judges to make sense about the laws. Judges have a degree of carefulness and innovative strengths through which they interpret legislation. The legislation includes certain terms which can have different meanings and can vary according to the circumstances. Thus, legislation should be written so that it can efficiently be implemented in numerous situations. Judges in such situations must deliver legislation with real sense. There are several conflicting opinions concerning the judges for defining the meaning of legislation. According to literal approach, “judges should not look outside” an Act of Parliament for assistance in interpreting legislation except in certain restricted situations9. On the other hand, the purposive approach discards the restriction of judges to search for meaning to a correct structure of the legislation. It proposes that interpreting role of a judge comprises where essential to look outside of the word of legislation in search of aim for representation. The purposive approach is distinctive in the legislation system. In this dominion, legislation tends not to go by overall codes and leaves the acceptable information by the judges9. Judges consult the circumstances and consider as long as information regarding legislation is certain, reliable and flawless. Judges consider this subjective purpose with respect to presumption that a statue’s ultimate purpose is its subjective purpose. Judges can refer to particular materials for clarification of law such as intrinsic materials and extrinsic materials. The intrinsic materials comprise those aspects of a portion of legislation which do not form part of text. Conversely, extrinsic materials are everything which is outside of legislation. They include extra material of any Act such as reports of Joint Committee, treaties of other global contracts, descriptive memos and script of parliamentary arguments. The rules for interpretation of legislation depend on whether the drive of court is constructive or circumstantial10. References Australian Law Postgraduate Network, 2009. “Aids to Statutory Interpretation”. “Statutory Interpretation”. http://www.alpn.edu.au/node/72 Bevans, Neal R. Business Organizations and Corporate Law. United States: Cengage Learning, 2006. Cengage Learning, No Date. “Mutual Assent”. “Mark Bond”. http://www.wadsworthmedia.com/marketing/sample_chapters/0324593562_ch10.pdf Fitzroy Legal Service, 2012. “Chris Field, Western Australian Ombudsman”. “The Law Handbook”. http://www.lawhandbook.org.au/handbook/ch12s01s03.php# New Age Publishers, No Date. “Law of Contracts”. “Business Law Including Company Law”. http://www.newagepublishers.com/samplechapter/001048.pdf Sandsbraaten, T., No Date. “Undergraduate Thesis on the Concepts of Conditions, Warranties, Representations and Covenants”. “Projects”. http://www.jus.uio.no/ifp/english/research/projects/anglo/essays/sandsbraaten_abstract.pdf Slapper, Gary & Kelly, David. The English Legal System. United Kingdom: Taylor & Francis, 2011. University of London, No Date. “Offer and Acceptance”. “Elements of The law of Contract”. http://www.londoninternational.ac.uk/current_students/programme_resources/laws/subject_guides/law_contract/contract_ch2.pdf University of London, No Date. “Consideration”. “External System”. http://www.londoninternational.ac.uk/current_students/programme_resources/laws/subject_guides/law_contract/contract_ch3.pdf Zarrokh, E., No Date. “Practical concepts in Contract Law”. “University of Tehran”. http://mpra.ub.uni-muenchen.de/10077/1/Practical-concepts-in-Contract-Law.pdf Read More