Ben V Mojo Beverage - Case Study Example

Question 1: Ben V Mojo Beverage In this case, it is important to determine the elements that are needed for the purpose of having a legal and binding agreement or rather contract. To effectively determine whether or not the contract was valid, it will be crucial to discuss the facts of the case in relation to the six elements required to validate a contract. First, for a contract to be valid, and legally bound, there should be a capacity to comprehend and appreciate the overall terms of the agreement. It is crucial to note that the overall process of contract formation should be perceived objectively (Vermeesch &Lindgren, 1990). In this regards, the aspect related to objectively means that the people entering the contract should be competent and legally of age. For this case, Mojo is certainly of legal sound mind and not a child. Under this element, the component of corporation like Mojo Beverage is also explored. It is noted that a contract entered with corporations present a very unique case since it enjoys implicit power to enter a contract when there is an accomplishment of an intended and predetermined purpose. For this case, the corporation being Mojo Beverage presented a challenge to be performed; catching Lord Harry. Secondly, it is noted that parties to a given contract should ascertain a mutual assent t whenever an offer is accepted under situations that objectively demonstrates that there was indeed a meeting of the minds. An offer is proposal by a person or corporation to enter into a given contract (Vermeesch &Lindgren, 1990). . For the case at hand, Mojo Beverage seems to have made an offer to Ben and the public at large of catching Lord Harry at a prize. On the contrary though, since the offer made by Mojo Beverage is made through advertisement, then this poses a great challenge. It is argued that advertisements are basically interpreted to be invitations for offers since they do not clearly postulate the present contractual intention on the part of the person making the advertisement, who in this case is Mojo. In this regards, the fact that Ben responds by pursuing the performance of the offer merely constitute an offer and does not in any way present an acceptance to the offer. Despite this, the offer was clearly made to the public and not just a specified single offeree hence the issue of its validity through advertisements is again downplayed and the contract again perceived as being a valid one. The offer at hand is thus legally binding because it has been communicated to all interested parties through advertisement. Certainly, the advertisements made by the offeror are faulty and has caused a great level of confusion. In the case of revocation of offers principle, it is ascertained that an offer that is made in relation to a particular proposed contract is a subject of absolute control of the offeror at its initial stage. It is emphasised that an offeror is allowed the opportunity to designate the actual time that an offer is to remain open, the place for which the acceptance is to be communicated as well as any given conditions that is to set for purposes of imposition (Carter, Harland, & Lindgren, 1996). Notwithstanding, an offeror is allowed to recall their immediate offers at any given moment in time prior to it being acceptance. In the event that this happens, the offeree loses the power to accept the offer. In addition to this, in order for it to be effective, the intention to revoke should be communicated immediately by the offeror to the offeree. However, in the event that the notice circulation is not received by the offeree as a result of errors made by the offeror r their agents, the revocation still remains to be effective even though the offeree, who in this case is Ben, has no knowledge of it (Carter, Harland, & Lindgren, 1996). The case can be explored by the ‘intention to create a legal obligation’ stipulation that allows a contract to develop a legal obligation alongside the offer and acceptance made, both of the involved parties should have the intention of taking their issues to court of law in the event that either of the parties fail to meet their immediate promise (Carter, Harland, & Lindgren, 1996). For most social agreements, there is usually no intention to take matters to court however for such commercial agreements as that of catching Lord Harry there is a presumption that there will be an intention to go to court. To effectively make an offer irrevocable, then an offeror can request a consideration as a return act as opposed to return promise and the offeree actually now engaging it by commencing performance of the requested act. In this case, it is deemed unfair for the offeror, Mojo Beverage, to revoke the offer of paying up the prize of $100,000 indicated in the advertisement unless a reasonable amount of time passes without the performance being completed. Thus, for this case, there is therefore a valid contract because; there is a legal intention to pursue any issues that might arise out of the commercial agreement of catching Lord Harry for a price. This is not a social agreement since it involves promises for a prize. It is also considered valid because the consideration is made in terms of an offer that is unilateral in nature and that Ben actually commences with the performance of the activity knowing very well that should he catch Lord Harry then he should be awarded the amount advertised as $100,000 and not $1,000. The offeror being Mojo Beverage cannot revoke the offer since it has already been accepted by the entire public including Ben and Lord Harry has been caught within a reasonable timeframe. Question 2: (a) Rights and liabilities of Livestock Brokers and Dorper Sheep Sellers Pty Ltd For this case, there was an intention to enter into a contract especially since there was mutual consent of the parties in this case; Livestock Brokers and Dorper Sheep. It should be emphasised that the two parties have agreed upon a similar thing and within a similar sense within the same time. Dorper Sheep Sellers Pty Ltd has shown that it is interested in selling a flock of sheep as Livestock Brokers has ensured to indicate that it is in fact, interested in purchasing this common product being offered for sale. In essence, there is an element of communication that is done in form of letters and fax from both of the parties involved. On June 1st, it is ascertained that Dorper Sheep Sellers were able to send a letter to Livestock Brokers indicating that they had a specific number of sheep for sale and the price that they intended to have them sold for. Clearly, this letter is an offer. It is important to understand that an offer is any proposal that is given by a person to enter into a contract (Carter, Harland, & Lindgren, 1996). The letter has been communicated to Livestock Brokers who are the offeree prior to having it being accepted. The letter is form a written form of offer from the offeror; in this case, Dorper Sheep Sellers to the offeree; Livestock Brokers. It is also important to note that any given offer continues to be in existence until it expires. Expiration of an offer is possible when there is a stipulated time limitation stated within the offer itself, for which the offeror; Dorper Sheep Sellers have indicated it to be 14 days. In the event that the stipulated time has elapsed then the offeree’s power of acceptance terminates automatically, unless there is a possibility of the offeror is able to formulate new offer then there can be no contract formation (Trebilcock &Leng, 2006). The letter dated June 6 is indeed a counter-offer. A counter-offer is an approach for which an offeree rejects the terms and conditions of the initial offer by accepting the offer but with material terms altered within the initial offer itself. In this case, the offeree; Livestock Brokers indicate to know whether the purchase of the sheep could be financed through ‘usual terms’. The offeree has not indicated that he has rejected the terms of the initial offer but is just simply bargaining for different terms hence the offer has been accepted and is valid. Notably, the fax of June 14 is indeed a valid acceptance since it was send prior to the expiration date stated within the initial offer (Trebilcock &Leng, 2006). It was sent on the morning of the close of business day hence it was still valid. The efforts made to revoke the contents of the offer and thus the contract by Dorper Sheep Seller is invalid since the offer remains to be open until the close of business after the elapse of 14 days. In fact, the promise to keep the offer open until 14 days have elapsed is deemed to be a determinant factor or rather consideration that continues to make it binding to both parties. As a result of all this, there has been a breach of contract on the part of the offeror being Dorper Sheep Sellers hence it attracts a remedy in form of damages to the aggrieved party of the contract; Livestock Brokers. Livestock Brokers is entitled to compensatory damages that can be in form of consequential damages where the aggrieved party is reimbursed for indirect level of damages that accrued from it suffering possible losses due to undelivered sheep (Trebilcock &Leng, 2006). The offeror can also be subjected to punitive damages, which seeks to punish the entity for breaching the contract at hand and thus, deter it from committing it any given day in the near future (Trebilcock &Leng, 2006). (b) Was Livestock Brokers’ acceptance effective? Such instantaneous communication rule such as the letter mode of acceptance is deemed to render an acceptance ineffective hence they are governed by the general stipulation that they must have been communicated to the offeror within the stipulated time. It is somehow ineffective to apply this method in such a case because the offeree is not able to know that at once his attempt to communicate was unsuccessful hence it is upon him/her to make a proper level of communication. Fax messages however; enjoy an intermediate position since the sender is able to know at once that the messages has been received hence making it an effective acceptance. Considering that there was an error that prevented the receiver from getting the message on time, and thus, the acceptance is ineffective since the sender has been able to know that the acceptor has not received it at all. Question 3 Given that there was a binding nature of the written lease between the two parties; Stuart and Westphalia Marts Pty Ltd, the promise to reduce the rent was indeed supported by a consideration. This is especially so since there was a bargain and exchange of value that was a result of a modification of the initial legal relation (Restatement of Contracts, Sec.75). there was a also a mutuality of obligation as both of these parties were all bound by the stipulation set up in the contract and that the new rent of $700 was a sufficient figure for such a premise. In the course of carrying out a contract, there is a possibility for there being a set of negotiations as well as alterations to the initial terms throughout the period for which agreement is running, which for this case, the agreement is running for a period of 5 or so years of lease. For a change to be effected within a contract, it is required that there should be some form of enrichment meaning that each of the parties should receive some form of consideration (Marston, 2008). It can be positively ascertained that both Stuart and Westphalia Marts Pty Ltd would both enjoy a form of sufficient consideration as Stuart would enjoy less rent as a result of financial problems while Westphalia Mart enjoy continual monthly rent income as opposed to having the premise vacated. Hence, the decision to rescind the promise later on results to a gratuitous promise as one party now suffers from receiving any possible consideration from the alterations of the agreement. As a result of this, this according to Australian consumer Law, Sec. 21 (ACL) results to unconscionable conduct as it defies a good conscience in a business environment (Marston, 2008). Stuart has a ground to seek for damages for breach of contract in form of restitution for the two period of detriment suffered as a result of not being able to enjoy the consideration that was developed in the course of altering the terms of the contract for that matter. References List Carter, J.W., Harland, D.J. & Lindgren, K.E., 1996. Contract law in Australia. MICHIE. Marston, D, L 2008. Law for Professional Engineers: Canadian and Global Insights, 4th Ed., McGraw-Hill Ryerson, Toronto, 2008. Trebilcock, M. &Leng, J., 2006. The role of formal contract law and enforcement in economic development. Virginia Law Review, pp.1517-1580. Vermeesch, R.B. &Lindgren, K.E., 1990. Business law of Australia. Butterworths. Read More