Fundamentals of Law and the Contractual Issues - Case Study Example

THE FUNDAMENTALS OF LAW THE FUNDAMENTALS OF LAW Insert name Insert grade course Insert instructor’s name August 17, 2011. Introduction The case study in this assignment involves two parties, Georgia and Malcolm, who decided to enter into a contract. Malcolm was leaving his home and required to hire a hoe pet care and so he contacts Georgia to do the work. Georgia guarantees Malcolm of good and professional work during the time he is away. Without paying much attention to the copy of standard form contract the Georgia sends, Malcolm signs it and delivers it back to Georgia. Georgia finally gets a job of feeding a tropical fish and an award winning rabbit, both belonging to Malcolm. While Georgia is attending the animals, she incorrectly feeds the fish the rabbit food and the rabbit the fish food. Consequently, the tropical fish dies and the blocking of the aquarium filter causes flooding in Malcolm’s house, causing damage to furniture and the house. Moreover, the rabbit loses hair due to stress from eating fish food and cannot be shown. In this case, I am going to discuss the contractual issues that arise in this situation and also advise Malcolm as to whether he can sue Georgia for breaching the contract. If suing will happen, I am going to analyze the remedies that Malcolm ought to seek. The contractual issues that arise in this situation To analyze this case, it is important to understand some of the concepts of contract law and how it relates to the case study. Contract law is ‘a body of law that controls verbal and written accords linked with exchange of commodities and services, cash and material goods’. It is an accord reached after adequate deliberation to do, or abstain from doing, a number of lawful actions. A contract is taken to be valid when two or more parties with capacity formulate an accord connecting valid deliberation to do or to abstain from doing a number of legal actions. If these elements prevail, the contract is legally binding, otherwise the contract is void. In the case study above, the contract was legally binding since the two parties had capacity and formulated an agreement associating valid consideration to do a legal act. In other words, Malcolm agreed to offer Georgia the job and Georgia on the other hand promised to give quality services. The term capacity in this case study refers to the capability to be acquainted with and comprehend the terms of contract. Both parties had the capacity and so the contract was legally binding. During their conversation, the two parties had a ‘meeting of the minds’ and thus a mutual agreement was made between them. In this case study, the constitutional rights and requirements of contracting parties are established by first, determining the provisions of the agreement, and secondly, understanding those provisions. You note in the case study that Malcolm was in a hurry to sign the standard form contract without reading and understanding the terms and conditions in it. He merely believed the words that Georgia gave when she said that she is professional, animal lover ad that it should not be a problem to him. According to Malcolm, this statement was contractual, although it is not stated in the case study whether it was included in the written clauses. It is important to note that whether a testimonial is contractual or not relies on the purpose of the parties, impartially determined, and is a matter of actuality. If this case goes to the court, the court, in determining the parties’ objective would take into account several factors together with the stage of the contract at which the statement was made, the significance which the representee appended to the statement as well as the relative information or proficiency of the parties in relation to the subject matter of the statement. Another issue that arises in this case is whether the conversation held before signing the written contract form part of the contract. We note that the two parties have reduced their agreement into writing. Whether a certain speech (verbal or on paper) creates component of the real contract relies on the use of the parol substantiation rule (Barron, 2006). According to the Substantiation Act, if the provisions of a contract have been condensed to the structure of a manuscript, then there cannot be any facts given in evidence of the provisions of such agreement, apart from the manuscript itself. Therefore, Malcolm cannot give any confirmation of any verbal accord or testimonial to disagree with, show a discrepancy, append to, or deduct from the provisions of the printed agreement that Georgia had issued to him, which he signed (Crosling & Murphy, 2000). In this case study, Georgia is liable, since she is responsible for the loss that Malcolm suffered. She is liable since she had a duty to attend to Malcolm’s pets, but somehow ignored or breached that duty. In such instance the court would find that Georgia was liable to carry out the duty and should impose a remedy to compensate the wronged party (Malcolm in this case) and might go on to impose punitive damages as well. Furthermore, the loss that Malcolm suffered resulted from the negligence of Georgia. Negligence in this case refers to the exclusion to carry out an action which a sensible human being, directed by deliberations which generally guide individual affairs would perform, or performing an action which a sensible and cautious person would not execute. Negligence is characterized mainly by carelessness, thoughtlessness, inadvertence, inattention as well as other omissions (Elias et al. 1982). Depending on the conversation that had taken place over the phone between Georgia and Malcolm, and the terms and conditions agreed in the contract, the court, would probably imply terms into the contract. In such a case, the term that is implied ought not to contradict any express term of the contract. A term can only be implied only if there is need that both parties ought to have intended its inclusion in the contract (The Law of Contract). The “Supply of Goods and Services act 1982” demands that a service be offered with reasonable care and skill, as well as within a reasonable time. Therefore, any trader (in this case Georgia) dealing with a consumer (Malcolm), or dealing with any customer on his own written standard terms of business, cannot exclude or restrict his liability for breach of contract or allow himself to provide an inadequate service unless he can show that the clause satisfies the ‘test of reasonableness’ (Chisholm & Nettheim, 2002). It is also not possible for him to demand the client to indemnify him against any loss the client may incur through negligence or breach of contract unless he can show that the clause satisfies the same test. The term negligence in this case includes breach of any contractual or common law duty to take reasonable care or exercise reasonable skill. Therefore, Georgia has no right to be indemnified against the loss that Malcolm suffered when his fish died, furniture was destroyed and the rabbit losing hair (Elias et al. 1982). Advise to Malcolm as to whether he can sue Georgia for breach of contract and, if so, what remedy or remedies he should seek Malcolm has the right to sue Georgia for breach of contract or negligence. Georgia is liable for negligence in administering her respective duties. She is responsible for providing services of a given quality and dimension. She had an obligation to deliver such services in agreement with commonly documented principles which reveal specialized competency. I would advise Malcolm to sue Georgia for negligence or breaching the contract based on these facts: She had a duty or obligation or care that required a certain standard of conduct; She failed to conform to that standard of conduct; There is a reasonable casual link between the failure to conform to that standard of conduct; and There was an actual loss when the fish died, and the rabbit lost its hair and destruction of furniture (Elias et al. 1982). According to the Unfair Contract Terms Act 1977, Georgia cannot exclude or limit her liability for the death of the tropical fish, the destruction of the furniture, or the issue of rabbit losing hair. If Georgia would try to limit her liability, under an exclusion clause, to a specified amount of money, then the court would be forced to take into considerations the resources to which she expects to be available to her to meet such liability and how far it was open to her to cover herself by insurance (Chisholm & Nettheim, 2002). She would be required by the court to prove that the clause was reasonable. Here, reasonableness will prevail. The main issue here is the level of negligence, what Georgia had agreed to do. She is normally legally responsible for the health of pets since she presumed a responsibility to care for them and did not succeed in that responsibility in exceptionally understandable ways (Elias et al. 1982). There are a number of remedies that Malcolm has since the services offered by Georgia did not conform to the contract. First, Malcolm can ask Georgia to pay for the death of the fish and the rabbit. The Sale of Goods and Services Act do not define what amounts to a ‘reasonable time’. Malcolm may ask Georgia to buy him another fish and rabbit and he would repair the furniture so as to ease the burden of Georgia. If repair or replacements are not practicable options, the legislation offers for the alternative remedies of partial, or full, reduction in price (a refund) (DTI, 2005). References: Barron, M. L. (2006). Fundamentals of business law. North Ryde, NSW: McGraw-Hill. Chisholm, R. & Nettheim, G. (2002). Understanding law: An introduction to Australia’s legal system. (6th ed.). Chatswood, NSW: Butterworth’s. Crosling, G. M. & Murphy, H. M. (2000). How to study business law. 3rd ed. Sydney, NSW: Butterworth. DTI. (2005). “A trader’s Guide: The Law relating to The Supply of Goods and Services”. Retrieved on August 17, 2011 from http://www.bis.gov.uk/files/file25486.pdf Elias S. Cohen, J.D., and Linda S. Staroscik, M.A (1982). “Community Services and Long-Term Care”: Issues of Negligence and Liability. Temple University, Long Term Care Gerontology Center. Retrieved on August 17, 2011 from http://aspe.hhs.gov/daltcp/reports/negliab.htm#chapII Terry, A. & Giugni, D. (2005). Business and the law. (4th Ed.). South Melbourne, Vic: Thomson. The Law of Contract. Singapore Academy of Law. Retrieved on August 17, 2011 from http://www.singaporelaw.sg/content/ContractLaw.html Read More