Leighton Industries and Callier Steel - Essay Example

The first step in establishing who wins the case is to first ensure if a valid contract exists between the two contractual parties. A valid contract existed between the Leighton industries and Callier Steel. The nature of the contract was a sale of goods contract. An offer was made to Callier Steel which was to deliver a specific brand of steel to Leighton Industries which the former accepted. Thus the threshold of an offer and acceptance that constitutes a contract had been met.

Consideration refers to a promise for a promise – what the contracting parties were supposed to get from each other. For Leighton Industries the amount of consideration was the specific brand of steel requested. For Callier Steel, the consideration must have been the amount of money included in the invoice. The two companies are of contractual capacity (Richards, 22). Thus a valid and binding contract existed between the two parties. The next step will be to find out if the two companies met their contractual obligations under the contract and if their contractual rights under the sale of goods contracts were mutually respected.

A contract is normally considered as an act of good faith that is free from any ill intent from the contracting parties. An act of misrepresentation constitutes a vitiating element in a contract. The representation must be inaccurate, misleading or untrue (Richards, 78).