Business Law - The Modern Law of Contract - Essay Example

Business Law Q Questions (14 marks a) Is the email from Mark to Angie on 11 March constitute acceptance? Explain your answers. (2 marks) No. Because by stating an amount less and different from that of the offeror, which she had indicated to sell her artwork earlier, usually constitutes to a “counter offer” (Stone, 2013, p. 50). Therefore, this normally cancels the initial offer whereby the offeror ends up stating a different price. To indicate acceptance on the part of Mark, he ought to have shown intention to legal consequences only through taking the offer as it was or as per the condition stated by Angie if there was any (Roach, 2012, p. 143). However, there was no condition in this to have for the acceptance to be applicable. By stating a different amount and becoming the offeror (Mark), the other party seems not to be willing either and instead gives her final price, which is also aligns with Hyde v Wrench case (1840). b) Only considering the communications between Angie and James, who is the offeror and who is the offeree? Explain your choice. (2 marks) Initially, Angie was the offeror but when James emerges with the price of $3,500 coupled with promise of helping her and the husband to pack in their quest to relocate to Sydney, she becomes offeree. This is because James then being an offeror stated the price, which he can afford to part with for the artwork and afterwards help Angie and her husband to pack for Sydney. Therefore, it was then Angie to accept or decline taking the offer based on unequivocal conditions already stated by James. In addition, the aspect of turning Angie to be an offeree is evident by her conduct, which according to law has indicated “intention” to legal consequences (Gibson & Fraser 2013, p. 367). This is being a compliant to an offer made though a “counter offer” with a condition that James will help them to relocate. Therefore, it was for Angie to accept or decline but due to the favourable terms that James stated, she decided to take the offer and even reject that of Mark. Since, his mail reached her before that of James. c) With whom does Angie have a contract to sell the painting? When was the contract to sell the painting formed? Explain your answers. (6 marks) Angie has a contractual relationship with her cousin James. This is because as per the case study, it is evident that she accepted “to sell the paining to James on that basis.” “Basis” in this case denotes the assistance, which with her husband they would receive from James. However, the latter offer seems too good for Angie to accept and decline $6,700 offered by Mark. The formation of the contract was after Angie exhibiting conduct in a manner to suggest unequivocal “intention” to legal consequences. This is quite evident with how despite having received Mark’s email earlier and seen to have come before that of her cousin, decides she will take the offer. Hence, she entered into a contract on 16 March, which was after seeing and evaluating the worthiness of her cousin’s offer. Therefore, she could not have reconsidered her decision upon finding Mark’s response on 17Th March for it is not explained. d) How does the fact that the painting is stolen affect the contract? Explain your answers. (4 marks) The fact of painting being stolen in this implies the contract will not take any effect; hence there is no contractual relationship among the parties. Since, what made them to draw an agreement is not there to substantiate their claims to each other. Because the event that ensued was beyond what they could have avoided, this was through theft. Theft in this case would amount to frustration because the forgetfulness of Angie in law is unforseen, unintentional and similar to any other incident like fire or accident (Fisher & Greenwood, 2011, p. 358). Consequently, based on Fisher & Greenwood (2011) study, this scenario renders the performance of the contract end up being impossible. Angie in this case can claim successfully claim defence because what ensued she was not foreseeing it occurring. Q2 a) Has RedCube breached the contract by failing to arrive at the pickup address before 2:00 pm? The delivery company did not breach any contract because the main reason for not arriving on time at the pickup address was a natural cause that hindered them. They could not prevent the bad weather hence why they had not arrived early as agreed. In addition, breach of contract comes about when the provider does not have a reasonable excuse for failing to keep time during their business deal. In this case, the delivery company stated bad weather as their barrier for failing to keep time. b) The hardwood bedside table (6 marks) i. Assume RedCube’s failed to deliver the hardwood bedside table in the original condition - would this constitute a breach of a condition or a breach of a warranty? Explain your answers. This would be a breach of warranty because the company promised the customer safe delivery of their goods. If this table arrives damaged then the company will be responsible for the damages. The warranty serves as a protector and an assurer for the customer that the goods will arrive in one piece. ii. Would Angie and Jack have been entitled to terminate the contract because of RedCube’s breach? Explain your answers. No. considering the terms and conditions of the delivery company, they do not seem to have breached any part of the contract. It states that they cannot be accountable for loss incurred due to poor packaging of goods on delivery. For the breakage and scratched it is because Angie and Jack did not do their packaging well. In addition, the whole deal had the four elements of a contract i.e. offer, acceptance, intention of legal consequence, and consideration (SBDC, 2015). With all these components, the contract is legit and has a legal binding with it. iii. What could Angie have included in the contract to cover this situation? Explain your answers. The reason for all these issues between the couple and the assigned delivery company are that they did not make further enquiries and any other possible solution to unpredictable situations like the bad weather. These enquiries would be of help in case one party could not keep the contract because of different circumstances (Beatty, & Sameulson, 2014 pp. 370). For instance, objective impossibility and impracticability came about when the company left one box because it was overweight. Due to this, the company removed itself from that obligation in the contract to deliver the goods. Therefore, Angie would have enquired on charges in case of overweight and any other miscellaneous. Angie should also have told Vince about the fragile artifacts that were as part of the goods. This could have been part of the contract and it would give the workers the sense of being careful while handling the boxes. In addition, Angie should have given the delivery a definite timeline for picking up the households rather than just saying pick up time to be before 2pm. c) The 36 kg carton (4 marks) i. Has RedCube breached the contract by refusing to pick up the carton? Explain your answers. Yes. They should have picked up the overweight box too because in their contract, they did not specify anything concerning overweight items. From the conversations, it also shows how the management did not outline all the terms and conditions until when the couple complained of their services. As much as both parties were wrong at different points, the company did not deliver its services well since they omitted some clauses in the contract and this made it look like they have done their job wrongly. ii. What could RedCube have included in the contract to cover this situation? Explain your answers. The company should have talked about the overweight goods in their contract and state its terms and conditions before taking any action so that their customers can know what to do or rather both parties can come to an agreement. For proper arrangements that will in turn avoid inconveniences, the company should also let their customers know that they will send a personnel to come and weigh their goods prior to the day of delivery. This is important because in any cases of overweight goods, they can come up with possible measures early enough. d) The broken wooden sculpture (4 marks) If RedCube wants to protect itself against liability, what should it do? Explain your answers. There are legal issues that can affect the transport business. The main work of such company is to ensure goods move from one place to another on behalf of their clients hence it involve a means of transport. To ensure understanding between the client and the transporter, the transport company must make sure he client is aware of their trading terms and conditions. They should do this before penning down the contract. The trading terms and conditions establish the necessary grounds under which they provide any specified service. This will limit the transporter’s liability in case of any claims (DBIS, 2013). When the transport company has the mandate to carry out transportation, they bear trust and responsibility of those goods, hence must protect and preserve them. In the cases of impaired goods, it shows that someone was careless with it and this is a liability to the company therefore, the client will demand for compensation. The company should therefore utilize their trading conditions in order to minimize the amount of compensation they will be liable for in case of such accidents or mistakes. References “Four Essential Elements of a Contract”. Small Business Development Corporation - SBDC. Retrieved from http://www.smallbusiness.wa.gov.au/business-topics/money-tax-and-legal/legal-matters/business-contracts/four-essential-elements-of-a-contract/ “Understand How Trading Conditions and Insurance Can Limit the Financial Risk for Freight Forwarders,” Department Of Business, Innovation, & Skills - DBIS. Retrieved from https://www.gov.uk/freight-forwarding-managing-risk Beatty J., & Samuelson, S. (2014)“Cengage Advantage Books: Essentials of Business Law,” Cengage Learning. Fisher, M., & Greenwood, D. G. (2011). Contract law in Hong Kong. Aberdeen, Hong Kong, Hong Kong University Press. Gibson, A. & Fraser, D. 2013. Business Law 2014. Australia: Pearson Higher Education AU. Hyde v Wrench (1840) 49 ER 132 Chancery Division (Decided by Lord Langdale MR). Roach, L. 2012. Card & James business law for business, accounting & finance students. Oxford, UK, Oxford University Press. Stone, R. (2013). The Modern Law of Contract. London: Routledge. Read More