Parking Facility on the Land of Albert Thomas - Essay Example

Annotated Interview Reference for the Albert Thomas Matter The annotated interview needs to examine the main components of the contract relating to the legal components of the establishment of a parking facility on the land of Albert Thomas. The interview will discuss the various terms and clauses of the parking lot. Terms Terms of a contract involve the various elements of the agreements that make up a contract. A contract is an agreement between two parties meant to get two things underway. A contract will involve a legal relationship that will see the exchange of something of value between two parties. The terms are therefore the detailed promises made by different parties of the contract. Some terms are fundamental whilst others are incidental. Fundamental terms are core components of a contract which form the very essence of a contract. In L Schuler AG v Wickman Machine Tool Sales Ltd1 it was held that conditions are the fundamental terms of a contract. They determine the very essence of the contract. The breach of a condition leads to the repudiation of the contract by the aggrieved party. In other words when the conditions are breached, the party that is unsatisfied is free to walk out of the contract because the contract was non-existent in the first place. Aside the core terms of a contract, there are other incidental promises that are meant to make the contract meaningful. In Chanter V Hopkins2 the judge held that “... a warranty is an express or implied statement of something which the party indicates shall be part of the contract and though part of the contract, yet collateral to the express object of it.” Albert Thomas Albert Thomas proposal seeks to provide parking services for cars of individuals that are traveling via the nearby airport and will like to leave their cars. This is a service that creates some kind of contract between Albert Thomas and the customers that will use the parking lot. Thus the contract must have conditions and warranties. Condition: The condition will involve the provision of a space within which customers can park their cars. This parking space is meant to provide safe parking for the cars that will be brought by customers. In return for the parking space, customers will pay a fixed rate for the service. From the plan, Albert Thomas seeks to charge per day. Warranty: This include additional services that can come up to complement the primary condition. This could include security and the valeting service that Mr. Thomas is proposing. Although these terms and conditions are important, there is the need to come up with certain important clauses to set the parameters within which Thomas can provide the services without incurring excessive liabilities. Also, these clauses will reduce ambiguity between Mr. Thomas and his customers. They include Penalty Clause, Exclusion Clauses and Exemption Clauses. The Penalty Clauses will identify certain penalties that customers will be liable to pay if they exceed the number of days they expect to use the lot. This will ensure that customers do not abuse their rights to use the facility. Exclusion clauses are clauses that identify liabilities that are not included in the contract. Typically, losses and theft above a certain limit would not be recoverable from Albert Thomas. This is because the contract is not a security contract but a parking contract. Exemption clauses sometimes complement exclusive clauses. They determine the scope of the contract at hand. A customer will be bound by the clauses that are put together in the contract for the use of the parking lot. In LEstrange V Graucob it was held that when a party signs a contract that contains written clauses like these ones, then the individual is bound by all the terms. Training Fact Sheets on Standard Form Contracts What is a Standard Form Contract It is a contract that has its terms and layout dictated by one party of the contract (Koffman & MacDonald, 2007). These are called contracts of adhesion because one party offers another person a contract on a take-it-or-leave-it basis. This means that the dominant party writes out terms that favour him and avoids certain forms of difficulties that he foresees. This can prove to be unfair. Typical examples include pre-printed contracts and various agreements a person accepts online before accessing a certain online page. Standard Contracts and Business Client Standard contracts are important aspects of business for a number of reasons: 1. It sets a framework within which the obligations of the contract will be discharged. It lays out a clear foundation within which a client can conduct business with a company. It prevents ambiguity and encourages consistency. It defines the framework within which the business will be conducted and sets out the rights of both parties of the contract. 2. A standard contract is very important in business because it enhances the day-to-day business environment. In other words it eliminates excessively long administrative processes through which new contracts should be drafted for every single process. Standard contracts provide a convenient framework within which thousands of transactions can be completed in a very short space of time. Problems of a Standard Contract to Consumers Sometimes, the party against whom the exemption clause is being used is not aware of the limitation (Koffman & MacDonald, 2007). This means that the contracts are unfair since the exemption clauses are not placed fairly before the consumers. Also, some businesses that write out such standard form contracts can use it to limit consumers. This is because such terms can be put together in a term that will lock the consumers into a tough bargain that will be fair to the seller alone and not the buyer. To avert this unfairness, the state enacted the Unfair Contracts Act. Unfair Contract Terms Act 1977 The Act renders exemption clauses in contracts invalid if they fail the test of reasonableness. There was an inherent common law provision called objectionable exclusion clauses (Koffman & MacDonald, 2007). This common law provision meant that consumers that were treated unfairly by the terms of standard form contracts could go to court and argue against unfair terms. However, this presented a wide range of possibilities and administrative problems. It was therefore necessary to enact the statute to prevent cases on many occasions. The Unfair Contract Terms Act creates a business liability when a contract causes death or injury of a customer (s13). It also makes it impossible for businesses to hide under their terms to avoid the damages that occur because of their negligence (s12). It also ensures that businesses comply with the requirements of the Sales of Goods Act which sets out minimum obligations of businesses in sales to customers. Report on the Situations of Clients Introduction: This Report examines the cases of three clients who have certain contractual issues with their customers. The report evaluates the rules in the matters, applies them and concludes on them. Sally Hawkins Issue: Sally has accepted an acting slot with a London production house. The offer of the production house promised to pay a West End salary to be mutually agreed. However, Sally and her producers have not been able to agree on a salary yet. Rules: A contract is formed where an offer is made by one person and accepted by another party. An offer must be clear, precise and capable of acceptance as it stands. In Harvey V Facey. In this case, Harvey wanted Facey to sell a property to him rather than the City. He therefore sent a telegram asking Facey if he was willing to sell the property and asked Facey to telegraph the lowest price. Facey responded with the lowest price and Harvey responded quickly by stating that he was interested in buying at the lowest price and requested for the deed to the property to be sent to him. Facey refused to sell the property at that price and Harvey sued for breach of contract. The court held that there was no binding contract because Facey did not make an offer. He just stated the lowest price at which he was willing to sell the property. This was not an offer. Application: As it stands now, the offer made by the producers cannot be considered a proper offer that comes with an intention to create a legal relationship. This is because there is no clearly defined consideration that will be exchanged. There is no salary that has been expressly agreed. This is because a West End salary is not clearly defined. Conclusion: As it stands now, there is no contract between Sally and the producers. This is because there is no clearly defined offer in the contract. Although there is an agreement, it is binding in honour only. There is no legal relationship that is enforceable between Sally and the producers. Gary Harper Issue: Gary has agreed to buy a motor bike from Speedy Garages Ltd on the usualy HP terms. The terms require that he has to pay 50% upfront but he does not have savings to pay that. Rules: In Raffles V Wichelhaus a merchant agreed to sell goods to a customer. The goods were to be brought into England by a ship known as Peerless. Unknown to the merchant, there were two English ships that were named Peerless. The first ship came and was not the ship that contained the goods. The customer was to wait for the next ship. He refused to purchase the goods. The court held that the contract was void because there was a mistake in the definition of the nature of the subject matter. Application: In this case, Speedy Garages entered a contract assuming that Gary Harper was aware of the original terms of the hire purchase agreement. It can be reasonably inferred that Gary believed that the agreement would allow him to pay in bits without a significant deposit. However, he discovered that he needed to pay 50% which he did not have at the time of the contract. It can therefore be inferred that there was a mistake in the nature of the subject matter or the terms of the contract. This is because there was no way that Gary could have known of the actual terms of the contract. Speedy Garages assumed this without taking reasonable steps to ensure that Gary knew what exactly he was bargaining for. Conclusion: The contract is void because Gary was not aware of the actual nature of the contract. He entered the contract under a different impression and realized that it was quite distinct. The contract is therefore not valid. Anne Eccles Issue: Anne has conducted a lot of negotiations to by a a flat from a vendor. She accepts all the terms of the contract but at the final stages she gets offered a job 100 miles away and desires to withdraw from the purchase. Rule: In Taylor V Cadwell the plaintiff hired the premises of the defendant to undertake a program for a number of days at a given rate. The program went on for a while. In course of the series, the premises was burnt to the ground. The plaintiff sued for the repayment of his initial deposit since the building was not available anymore. It was held that the contract was frustrated. In that manner, the contract was to be considered as one that had been discharged. So the plaintiff was refused any refunds. However, in Krell V Henry one party rented the flat of the other party to be able to see the procession of the newly crowned king. He agreed to pay part of the rate. However, the procession was cancelled and both parties sued each other. One sued for the money he paid and the other sued to recover the rest of the money to be paid for the use of the premises. It was held by the court that the contract was frustrated since the subject matter was cancelled. Application: In this case, Anne entered a contract when she was certain she will live at the location of the flat. The conditions were favourable and they pointed out to the fact that she was allowed to live in the place she was purchasing the flat. However, there was a significant change in her condition and she was required to leave the whole place. This means that the flat will not be of any use to her and as such, the contract cannot be discharged in full. Conclusion: The contract can be considered as frustrated. This is because there was a significant change in Annes condition after the contract was discharged. So she can forfeit her right to the flat and get her money refunded. Client Information Leaflet The following elements are terms typically implied in retail contracts for consumers to honour when they undergo retail contracts. The implied correspond with the express terms and situations that are part of the express terms. They can be classified as terms that are implied by statute and terms that are implied by the courts. Terms Implied by Statute The Sales of Goods Act 1979 which was amended by the Sale and Supply of Goods Act 1994 provides four main terms that are implied in retail contracts. They are: 1. The seller has the right to sell the goods (s12). 2. The goods must correspond with the description of the seller (s13). 3. Goods must be of satisfactory quality (s14). 4. The sale of bulk goods should correspond with the sample. Terms Implied by the Courts There are three main terms that are implied by the court. They are: 1. Obvious terms that a reasonable person would infer to be part of the contract in question. 2. A legal requirement that complements the retail sale. An example is a situation where a person purchases a car. It should be implied that the seller of the car holds the legal rights to be able to execute the sale. 3. A customary term is something that is generally accepted action that must come with the retail sale. Exclusion Clauses in Contracts Jim and Joyce Paisley Issues: There are two issues in this case, the first issue is whether the Strand Council is liable for the damage of the Paisleys car at the park or not. Secondly, we examine whether the managers of the fair grounds, Leisure Ltd is liable for the injury of Jim and his wife or not. Rules: There are two different cases that draw parallels in this situation. In Olley v Marlborough Court a person booked into a hotel. The hotel was broken into by a stranger and the properties of the person were stole. The hotel had a notice at the back of the doors of hotelrooms that said "the proprieters will not hold themselves responsible for articles lost or stolen unless handed to the manageress for safe custody." The client sued the hotel for damages. The court held that the hotel was liable for the loss because the notice of the terms were not presented before he entered the contract. In another case, Thompson v LMS Railway a man who could not read the terms of a contract written at the back of a ticket got injured. He sued for damages because the court did not take reasonable steps to explain the terms of the contract and the railway companys view of injury. It was held that the railway company was not liable for the injury because the onus was on the client to find out about the terms of the contract. Application: In the first case, the Paisleys were not given notice of the liability for risks. This is because the notice that the risk of using the lot reverted to the customers was not conspicuous to the customer. This therefore means that they could not reasonably identify their liability. This means that the Strand council cannot argue that they are not liable. In the second case, the liability of the leisure company for injury was stated at the back of the ticket. This means that they had reasonably disclosed their terms to the Paisleys. This therefore means that the Paisleys cannot argue that they were not aware of the fundamental terms of the contract. Conclusion: The Paisleys can sue the Strand Council for the damage of their car. This is because they were not reasonably given notice that the risk of damage reverted to them. However, they cannot sue the leisure company for the damage because the terms of the contract were stated behind the ticket they received. Reflective Revision Tool for Students There are various approaches to the discussion of matters to identify the correct and appropriate solution to the problem. The popular technique used in most cases involves Issue, Rules, Application and Conclusion, also known as IRAC or in some cases the IDEA technique. In this article, I will like to use the Paisley case above to demonstrate how the technique is used. Basically, the technique involves the following steps: Step 1: Issue: This involves the identification of the issues at hand. In the Paisley case, P entered a contract with S and L. The issues P had is whether S was liable for the damage of their car or L was liable for their injury in relation to the terms of the contract and how the contract was formed. This step involves the conflict at hand and its relation to the parties involved in terms of legal matters. Step 2: Rule: This involves the rules from established legal systems and structures. It could be the exploration of legal statutes, precedents and the like. In the Paisley case, there were two landmark cases that were parallel to the situations between P and S and L. The cases are both precedents that can be duly applied to this case at hand. In other instances, statutes and other legal instruments could be quoted in this section. Step 3: Application: After the issues and the rules are identified, they need to be integrated at this point. This means that the actions of the parties involved in the case in question will be matched with the established rules and precedents. In our case, Ps claims against S and L will be compared with the precedents of the two cases at hand. The differences and similarities will be mentioned and the case will be analysed systematically. Step 4: Conclusion: After the analysis in the previous step are carried out fairly, the obvious legal rulings of the cases will be pronounced at this point. This section must be clear enough to reflect the realities of the situation at hand. In the Paisley case, the conclusion was parallel to the findings of the major cases applied. References Koffman, L. & MacDonald, E. (2007) The Law of Contract Oxford University Press. Read More