Commercial Law and Negotiation: The of Hardwear Ltd - Case Study Example

Commercial Law and Negotiation: The Case of Hardwear Ltd The world of commerce cannot escape the existence of misunderstanding and misinterpretation in its processes. Every country acknowledges this reality. Several constitutions have clauses on Commercial and Negotiation Laws. They trim trickery and ill intentions in the industry. Besides, they create justice in the market, protecting both the sellers and buyers from malpractice. One party may unfairly gain huge profits from a transaction involving the second party. A gain on this party triggers a loss on the other party. Understanding between the trading partners is equally superior. In such circumstances, it is advisable for a company to engage the other company on the mitigation process. That is the commercial justice. Commercial fairness exists when trade is made to satisfy the needs of both consumers and producers unconditionally. This paper seeks to identify possible solutions and remedies that hit Hardwear Limited. It outlines the approaches used to respond to such emergencies like theft and other risks. Regarding the Samesing plasma televisions, Hardwear Ltd should treat the case with much caution and sobriety. This can be achieved by laying down the procedures involved in the contract and adhering to the commercial laws in handling the situation. Maintaining the relationship is paramount in any business engagement. Offrez Ltd is a reliable creditor. Hardware and Offrez faces a possible conflict over goods stolen on delivery. However, the goods were ordered and delivered on credit. Hardwear Ltd appreciates the fact that Offrez Ltd has always carried out a healthy credit transaction. It is wiser and safer saving the relationship between the two companies. The Hardwear executive should be commended for accepting the delivery of the ten (10) Samesing plasma televisions. It is a solid show for their commitment towards maintaining a business relationship (Dal Pont 15). It displays the value they hold to the reliable creditor. Given the demand for the products, Hardware should sell the ten Samesing plasma televisions to the willing buyer immediately. This is better since the retailer is offering a relatively higher price. It is obvious that Hardwear shall realize profit from the sale of the ten television sets. Hardwear should also suggest to Offrez Ltd the idea of sharing the loss of the fifteen (15) television sets. It is true Offrez should take the full responsibility. It is also true that Hardwears stock rely on this supplier. It is equally evident that the credit facilities sustain the business activities carried out by Hardwear. An attempt to convince the creditor to share the loss is likely to boost the creditors loyalty in the debtor: Hardwear Dal (Pont 15). Most companies aim profits. Hardwear is naturally profit oriented. However, the situation at hand overrides the thirst. The law of commerce emphasizes on good understanding between trading partners. Offrez is such a rare partner. The law of commerce recommends that the contract signed by the parties who intend to engage in selling and buying should be respected and embraced. Heardwear limited should sell to Navraj the remaining five Philips brand radios on the same same amount they agreed to sell the 20 packed Philips radio Dal Pont 15). Much as the new customers demand leads to increase in a better price that what was to be paid by Navraj, the Hardwear limited should respect the need and time when Navraj ordered for the items despite the fact that the goods that were packed for Navraj were stolen and they ordered 20, the Hardwear limited should give Navraj the 5 item of Philips radio at the same price and then later deliver the rest of the 15 Philips radio. However, it is true that Navraj had not paid for the items since they terms were on cash on delivery. The contract law should be respected since the agreement was on cash on delivery and nowhere Navraj can identify and made order. On the other hand Navraj ordered specific goods from Hardwear Ltd. The sale of the goods was also unconditional. Navraj made the offer to purchase the specific amount at a price and Hardwear Ltd agreed to supply the requisitioned amount, resulting to formation of a contract, as there was an offer, acceptance and a consideration. The parties also intended to form a legal relationship. The contract was therefore concluded at the time the seller agreed to supply the items. The risk also passed at the same time (McMillan 23). Therefore, Hardwear Ltd should still be paid the price for the goods as the risk had passed Fillips. On the issue o where Allan sold a truck worth 4,750 Pounds to Hardwear Ltd. Apparently his possession of the truck was subject to higher purchase terms that he had agreed upon with Cheery Finance Ltd, but which he could not keep up to. He had defaulted 29 monthly installments for the payment of the truck. Hardwear Ltd then re-sold the truck to Barbara for 4,750 pounds, who subsequently sold it to Edward for 3,800 Pounds by the time Barbara’s cheque was found to be invalid. Edward refused to return the truck claiming he had duly purchased it. In determining liability, Hardwear limited should be to guide by the principles of fraudulent misrepresentation and unilateral mistake (Piterou & Fred 115). The effect of a fraudulent misrepresentation is that the contract is voidable at the election of the disadvantaged party (Culp 12). Title can pass to a third party who bought the property seeming to be true what was a fraudulent misrepresentation. The contract is therefore voidable at the election of the election of Hardwear Ltd, being the disadvantaged party to the contract. It can therefore choose to rescind the contract and have Allan pay back the price. The rationale is that since there was no valid contract, there should be no consideration. Hardwear Ltd cannot recover the truck from Edward. Therefore it can opt to pursue Allan (Dias, Portolese, & Shah 113). Since Ms Diane is the only employee of Hardwear Ltd with the authority to buy items worth over 200 Pounds on the Company’s behalf. While setting out for her holiday, she instructed her assistant, Jeff, to make the purchase of a re-conditioned ZX12 Printer from Inky Ltd for a maximum value of 750 Pounds. Based on the law of urgency, an agent is authorized to act for the principal. The first issue is whether Jeff acted as an agent in expressing interest in the machine at a price higher than that which Ms. Diane was authorized to buy at; and further at a higher price that Ms. Diane had instructed him to buy it at. We are told Ms Diane was only authorized to buy items worth 200 Pounds. She instructed Jeff to purchase the particular printer for 750 pounds and he expressed interest to buy it at 900 pounds. In particular, it should be established whether Ms. Diane could delegate the duty to Jeff and whether Jeff could buy products at a higher price than instructed by Ms Diane (McMillan 87). The second issue to be determined is whether there was a contract between Hardwear Ltd and the company. An agent is authorized to enter into a binding contract on behalf of the principal. Following the determination of whether Jeff was acting as an agent of Ms Diane or Hardwear Ltd, we can then determine whether he had the capacity to enter into a contract for sale of the ZX12 Printer with the company. If there was a contract existing at the time the company sold the ZX12 Printer to Kerry, it will amount to a breach of the contract between Hardwear Ltd and the company. Hardwear Ltd will then be entitled to remedies for breach for contract. If the matter would be complicated the Hardwear limited should involve advocates to help solve the matter (Cartwright 34). Under the law of agency, an agent is under a duty not to act beyond the power expressly provided for by the principal. He is also under a duty not to delegate the authority given to him by the principal. Ms Diane therefore breached her duty in agency in delegating the authority to Jeff. Jeff’s principal in this case, however, is Ms Diane. However, by acting beyond what he is empowered to do, he acts in breach of his duties under agency (Cartwright 21). He therefore lacked capacity to quote the amount he did. Therefore, no contract was formed between Hardwear Ltd and the company. Hardwear Ltd cannot therefore claim under breach of a contract. In De Bussche v Alt, it was held that an agent could not delegate to himself authority other than that authorized by the principal. A ship owner based in the Isle of Wight sought to sell a ship that was in Orient (Cartwright 21). The owner, to facilitate the sale, sought the services of a merchant shipping firm based in Japan, instructing a partner at the firm not to sell the ship below $ 90,000. The partner bought the ship and resold it to a prince at $160,000 making a profit of $70,000. It was held that that he had a fiduciary duty to act in the best interest of the principal, hence had to account for the $70,000. Conclusion The constitution is the most reliable institution for justice. Understanding between companies is also a component highlighted in most commercial laws within the constitutions. Hardwear Limited has the opportunity to showcase this reality in relation to its current experiences. The executive of the Hardwear Limited should take and apply appropriate approaches as stated in commercial laws. They should be aware of the risks and complexities involved in carrying out business. They should therefore find the correct procedure to handle such crises. Works Cited Cartwright, John. Misrepresentation. London: Sweet & Maxwell, 2002. Crawford, J. The law of international responsibility. Oxford: Oxford university press. 2010. Culp, Christopher. Risk Transfer Derivatives in Theory and Practice. Hoboken: J. Wiley, 2004. Dal Pont, G. Law of Agency. Australia: Butterworth, 2001. Dias, Portolese, and Amit, Shah. Introduction to Business. McGraw-Hill Higher Education, 2009. Honkonen-Kulagina, Alina. "Developing a business plan for a company in Finland owned by foreigners. Case: Prime Sails Ltd." 2012. McMillan, Catherine. Mistakes in Contract Law. Oxford: Hart Publishing, 2010. Print. Piterou, Athena, and Fred Steward. "Emerging innovation networks and the print-on paper socio-technical regime." Procedia-Social and Behavioral Sciences 10 (2011): 104-122. Read More