Application of Contract Law - Assignment Example

Customer’s Name Customer’s Course Tutor’s Name January 31, 2013 Question 1 Issue Where there has been an invitation to treat, this indicates that an offer has been made and for there to be acceptance, there has to be a consideration that is genuine. This is a case where there is application of contract law and the major concepts to be observed are undue influence where the couple were influenced that the amount agreed upon was fit for the sale of the land and the concept of unconscionability where the couple is not aware of the contract being entered into in the sale of a farm where a couple though old engage into a contract of selling their farm as they can no longer manage it. Rule Under Contract Law1, for there to be a legal contract, there has to be an offer and an acceptance which is usually sealed with a consideration and in most cases, it is in terms of money. Contract Law 2is used in selling of property as it is the law which through the Common Law 3protects both the buyer and the seller in their dealings. In the contract, there has to be an agreement which declares the intention to create a relationship of sales. A contract can however be terminated and in a case dealing on reliance of some information that was thought to be genuine, it can be terminated by agreement where both parties agree to discontinue having a contract existing. However, if the injured party does not do anything within a stipulated time given by the court, it is deemed that rescission cannot act as a remedy towards the contract. Application With regard to the case of Decro - Wall International SA v Practioners in Marketing Limited4,the contract was terminated a s reasonable time had been given and failure to obey the time that had been given by the courts made the contract void as it was terminated. In the above case there was an acceptance as in the case of Masters v. Cameron,5 where the acceptance was absolute indicating there was an agreement. Conclusion As a remedy, it will argued out that initially it was an invitation to treat which was open to anyone and the couple did not specify on who was the specific person to buy the land. The couple have a legal right to terminate the contract at any time as the initial contract is not legally binding in any way. The couple has the rights of looking for another buyer on noticing the advisor and they are not liable for any expenses that arose while negotiating the sale of the land. They had been given a consideration but for a contract to be genuine, the worth or reward for the contract also has to be genuine .This makes the contract that is in existence not to be legal because the consideration given is too low and the adviser may be taking this as an advantage due to their age and the trust they have in him. The courts should with hold the sale of the land until a buyer who has the right worth for the farm introduces themselves. Question 2 Issue This case deals with contract law where promissory estoppels and consideration will argue out the case. Ben is a contractor and Andrew being the potential client offers Ben to build for him a house where he accepts with a stipulated agreement and consideration .As Ben builds the house and waits for Andrew to fulfil his part of the agreement through a certain amount of consideration which he declines to pay. Due to the agreement that both had in before the construction started, Ben relies on Andrew which leads to the concept of promissory estoppels. This case seeks to find out if there are any penalties that Andrew can be given as a result of not paying up for the additional amount and if Ben has any right to sue him for making him suffer detriment which is as a result of financial loss. Rule The contract reached is legal due to the characteristics that it has. First, there was an agreement reached upon where one of the parties made an offer and the other agreed to accept the offer. There has also been a consideration which is something given for exchange as a result of accepting the agreement. There has also been an intension to enter into a contract as both the offeree and the accepter have agreed to the terms of the contract through payment of $600,000.In making the contract legal they have reached the age of capacity making them eligible to engage in a contract. Both have agreed to enter into the contract by their own genuine will hence any consequences that should follow, they are to take up the task of being responsible. In the case, common law principles will be used as they result to judgement of contract law. Promissory estoppels is under contract law where both parties promise each other that on completion of a certain task, there will be a consideration which is in terms of a gift or a reward in terms of money. The contract made in this case is express where there has been earlier communication of the contract and one of the parties has relied on the promise of being paid. After noticing that the farm was more than the $600,000, Contract Law gives the power to terminate the contract unless the original buyer will want to pay more for the property within a certain duration agreed upon. Application As in the case of Stilk v Myrick6, promissory estoppel was applicable where both parties agreed on a promise once. In Hartley v Ponsonby,7there was fulfilment of a service this indicated that there was a contract that existed between both parties. Due to contractual terms in the cases of it was held that as a matter of fulfilling the services agreed, both parties were to seal the agreement through a consideration. The case of Williams v Roffey Bros8 was about reliance of a promise of being paid and as a result of relying on it suffered a loss for not being paid. As a result of fulfilling the duties of construction in the case of Walton Stores Ltd v Maher, 9 it was held that the company had all the legal rights of consideration of being paid a lump sum amount for the completion of the construction. Conclusion To rule out this case, it has been seen that Andrew has the right to be given the full amount owed by Ben due to the fact that he relied on the promise of being paid and this was a as a result of a guarantee due to the part payment that he had received earlier. By saying that he would pay for the extra amount incurred in the construction, this indicated fulfilment of a contract and by not giving the full payment of the work lead to a breach of a contract. Andrew therefore has the right to sue Ben for non completion of the payment as this will lead to unfair terms in conducting a contract. As an element in promissory estoppels, Andrew was to suffer detriment where there was an expectation of suffering loss financially as Andrew had used his funds to cater for the additional the expenses. By the use of restitution, Ben has no right to take up the property before he clears payment on the basis of Quantum merit stating as much as he had incurred, so is the much that he should earn. In order to be successful in suing Ben, Andrew must show that there was a cause that will lead to a loss. By completion of the building, this will be evident that he completed his part of the contract and this would result to a breach of contract if he was not paid all the money agreed upon. By being silent, this showed that Ben had agreed to pay up for the additional expenses making Andrew have a right to sue him. References Common Law Contract Law Decro - Wall International SA v Practioners in Marketing Limited [1971] 1 WLR 361 Hartley v Ponsonby [1857] 26 LJ QB 322 Masters v. Cameron (1954) Stilk v Myrick [1809] EWHC KB J58 Walton Stores Ltd v Maher. (1988) 76 ALR 513 Williams v Roffey Bros [1990] 2 WLR 1153 Read More