The Need to Fulfill Contractual Obligations - Case Study Example

In order to advice Orlando in the given case, it is imperative to begin by explaining what a contract is. A contract is an agreement which is enforceable by law and which creates rights and duties between the parties involved (Klein & Viljoen 2002). This can also be a promise between two parties that one or both of them has to do something for the other in return from something. This is usually binding and legally enforceable if the agreement has been made but in some cases, it has to be noted that not all agreements between people are binding. According to Harvey v Facey [1893] AC552, every contract consists of an offer made by one party and accepted by the other. In simple terms, it can be said that if you have entered into an agreement with another person to sell him a car and he agrees on the terms and conditions of payment, then you will have made a contract that is legally binding and enforceable. It can be noted that a contract can be in verbal or written form but the most important thing is that there would be an agreement to perform duties especially between two parties involved. In the case involving Orlando and Kate, it can be seen that their contract is straight forward and is very clear about the terms and conditions of payment of the car. When Kate lost her job, she still has an outstanding amount and the date is almost due but Orlando is too compassionate to the extent that he offered Kate just to pay half of the amount by a certain date and let the rest fall away. First and foremost, Kate is not disputing that she owes Orlando his money which is part of the contract. Orlando voluntarily changed the terms and conditions of the contract which gives rise to a new version of the same contract. As long as there is agreement, this becomes legally binding and in this case, it is Orlando’s initiative. Once a contract has been made and both parties involved are aware of the contractual obligations to fulfil, this becomes legally binding and is enforceable in the event of breach of that contract by the other party (Gibson 1988). The fact that Kate later finds a better paying job than her previous one is no longer an issue here. Orlando realises that probably Kate will be earning more than him so he wishes to claim the rest of the money she had agreed to pay. It is advisable to Orlando that this amounts to jealous and would not help in any way in his quest to have Kate pay the rest of the amount as originally agreed. He changed the contract out of compassion and this became the new contract. The new terms he proposed were agreed by both parties and Kate managed to fulfil her obligation to pay half the amount owed within a week which translated into saying that the deal was sealed and there was no one who owed another anything. From a close analysis of the definition of contract given above, it can be noted that once there is mutual agreement over an offer and exchange made for something, it becomes a contract that is legally binding. It is therefore advisable to Orlando that he must put the case to rest as there is no issue. Secondly, it can be noted that Kate is not disputing that he owes Orlando the remaining balance of £1 250 despite the fact that she recently lost her job. Instead, Orlando could have adjusted the terms and conditions to stretch a little bit further until the time Kate will get the money but he chose the other way which was not disputed by Kate as well. He was also given a bottle of wine as a token of appreciation for his kindness and he accepts it. This shows that there is mutual agreement between these two people which is a basic tenet in the formation of the contract. It defies logic for Orlando to think of reclaiming the rest of the money upon hearing that Kate has found a better paying job since this remainder of the money was cancelled when they reached an agreement that upon payment of half the amount, the deal will be sealed. It is advisable to Orlando to just leave the case as any attempt to sue Kate will only expose his greediness. It can also be seen that the chances of Orlando winning the case will be very slim given that the later agreement is silent about what could be done if Kate finds another job. It is only clear that the remaining balance be thrown away upon payment of £625 before the next Wednesday of which Kate dutifully did that on Tuesday morning before the agreed date. Upon payment of this requested amount, this spelled the end of the contract so it would be folly for Orlando to try and bulldoze his way to regain the other money which he had ironically thrown away. What has been agreed between the two people becomes legally binding which means that if one part later decides on something without the knowledge of the other, then that does not form part of the contract. This entails that Orlando will be bound to lose the case given that it is out of their agreement. It can also be noted that the courts are mainly there to solve any disputes that may arise especially in cases involving contracts. It is the role of the court to establish if the agreement existed between the two parties involved in a dispute. In this particular case, it can be noted that there is no one who breached the agreement but Orlando wants to reverse the contract through unorthodox means. It is not the duty of the court to reverse agreement made between two people. In this particular case, it will be absurd for Orlando to report against himself. He is the one who made the new offer of which Kate complied and it should be borne in mind that Kate never disputed that she owed him some money despite the fact that she had lost her job. Orlando can only file a lawsuit against Kate out of jealousy or greediness but this does not help in any way to get the remainder of the money. He is the one who sets the conditions so it is better for him to just ignore the case than humiliating himself over something he knows that he is the one who initiated it. When people enter into a contract where the seller offers a product in exchange for payment from the buyer, it means that they have entered into an agreement where both the seller and the buyer have a duty to fulfil. The buyer must fulfil the duty of paying for the product sold and the seller on the other hand must fulfil the duty of supplying the product once the terms and conditions of payment agreed have been fulfilled. Whenever there is no breach of contract especially on the terms and conditions agreed, there may be no reason for the other party to later change his or her mind after the contract has been executed. This will not be acceptable given that it will be out of the original agreement between the two contracting partners. Whether written or agreed verbally, a contract is binding and it is a reflection of what has been agreed by two parties involved. Over and above, it can be seen that the two parties who enter into a contract often do it freely where there is no undue pressure on the other side by the other party. It can thus be argued that something that has been made freely and agreed upon is enforceable in the event of failure to fulfil the contractual obligations as mentioned in the agreement. The guiding principle in the formation of a contract is that both parties involved are intentionally aware of the agreement they would be making. Where there is no one forced into making a contract, then there is every reason for both parties involved to honour their contractual obligations. In this case, it can be noted that there is mutual understanding between Orlando and Kate in the agreement made in the sale of the car. It has been noted that it will be very unwise for Orlando to seek to reverse the agreement he initiated after realising that Kate later found a better paying job. Their contract is already sealed and any attempt to revisit it would be tantamount to extortion. References Aldous J., & Levy D. (1991). Making and breaking the law. Victoria. UCTA Publishing Company. Cachalia A et al (1994). Fundamental rights in the constitution. CT. JUTA. Consumer law- What is a contract? (N.D.). Retrieved 07. Dec. 10 From: http://www.paralegaladvice.org.za/docs/chap12/02.html Contract-frustration (N.D.) Retrieved 07 Dec. 10 from: http://tutor2u.net/law/notes/contract-frustration.html Duplessis L. (1999). An introduction to law. 3rd Edition. Juta Gibson G.T.R. (1988). South African mercantile and company law. Cape Town. JUTA & Co LTD. Kleyn D. & Viljoen F. (2002). Beginner’s guide for law students. 3rd Edition. CT. JUTA Koffman L & McDonald E. (2007), The Law of Contract, 6th Edition, Oxford University Press. Retrieved 06 Dec 2010 from; http://books.google.co.za/books?id=8JtwkQrAC_kC Read More