The Application and Violation of the Law in the Society and Business - Case Study Example

Name Institutional Affiliation Course Date Introduction The application and violation of the law are common in the society and business operations as well. In the first element, there is a legal issue entailed where Build it High Limited has entered into a contract to construct a new housing estate for Fields Trust. However, Build it High Limited has decided to subcontract the part of erecting a conservatory for each of the houses on the new estate to Superior View Limited. As such, the legal issue here is the aspect of transferring a part of the task to a third party which is Superior View Limited. The inability of Superior View Limited to pay the employees’ wages as a result of a cash flow problem has led to the workers going on strike and thus refusing to continue operations. This is another legal issue present in the analysis. Build it High have entered into another contract with Superior View Limited to assist them in raising funds required to pay the employees to avoid delays in the construction and completion of the conservatories. The delays have further been said to result to loss of potential buyers for the new houses. Therefore, the second contract is to pay Superior View an extra 25,000 Euros and thus not have to look for another builder to complete the construction of the conservatories. After Superior View Limited pays their employees, Build it High have refused to pay the additional 25,000 Euros since Fields Trust have gone bankrupt. The reduction in prices by Aspray Lakeland Limited to sell the houses is another legal issue in this case as it reduces the claims owed to Superior View Limited by 20%. The essay will analyze the issues listed above and seek to offer possible solutions that may be applied. This will be undertaken through the application of various cases that are related to contracts or the issues at hand. The cases will be assessed together with their solutions and applied in the concerns that have been raised. Looking at the various elements of a contract is significant before proceeding with the analysis of the problems. There should be an offer and acceptance by the parties involved in a contract. The offer must also be discerned from a form of willingness to either negotiate or participate in the deal. As such, the absence of acceptance was evident in some parts of the entire case of Build it High Limited. There is also the intention to generate legal relations which are another aspect of a contract. In this case, it implies that the parties involved in the contract should have the intention to enter into a form of legally binding agreement. As such, it will assist to shape or give solutions to situations that may occur. For instance, in the case where Fields Trust went into liquidation causing Aspray Lakeland Limited to be unable to pay Superior View Limited may have been viewed in the context of the intention to develop contractual relations. As such, Superior View Limited would have had the right to sue Fields Trust who would have in turn sued Aspray Lakeland Limited. However, with the absence of a contract then this would have proven to be impossible for these companies to undertake (Poole, 2014). Consideration is another critical aspect that should be considered in a contract. It entails the price that should be paid for the promise that had been made to another party. It may be anything valuable and not necessarily money. The existence of a consideration further means that the court will not raise issues of its capability as long as it contains some form of value. In a contract, consent entails the free will and proper comprehension of the role of each party. As such, the consent should be genuine. A proper consent may be influenced in a negative way through a mistake, unwarranted influence, false statements and compulsion. The pressure is usually extended in a case where a contract was entered due to a risk that may have occurred concerning the economic well-being of one of the parties. In the case analysis, Fields Trust can be said to have gone into pressure since they have become bankrupt. Their insolvency has further resulted to the incapability to pay Build it Trust who are also in a situation where they cannot pay up the extra 25,000 Euros to Superior View Limited (Poole, 2014). Additionally, contracts that are void or illegal are not recognized by law and thus cannot be enforced. There was also no sign of an illegal contract. The void contracts usually entail those that are aimed at committing a fraud. They may further be those that result in defraud of the revenue, the sexually immoral ones and those that promote corruption among the public (Poole, 2014). In the case of Thomas v Thomas (1842) 2 QB 851, a husband had the wish that his wife inherits his house. The individuals in charge of executing his will came to the agreement that the wife could possess the house and pay 1 Euro annually as ground rent. The executors then refused to proceed with the deal. Therefore, the issue is if the 1 Euro consideration should be enough. It was decided that it shouldn’t and as such a claim should be allowed. There should also be considerations for parties to ensure that they obtain a real bargain. The same can be applied in the situation of Superior View and Build it High wherein the second contract, Built it High refused to pay an additional 25,000 Euros as a result of Field Trust going bankrupt. There should be considerations that will lead to reversing this element and as such, Build it High end up paying Superior View at least part of the additional 25, 000 Euros (Todd, Burrows, and Finn, 2011). Another case would be that of Hartley v Ponsonby where almost half of the crew left the ship in the process of the voyage and the leader made an assurance to pay more for those who had remained and had the will to continue the journey. However, he failed to enforce his promise resulting to the sailors who had remained raising a legal action against him to recover the payment. This is still similar in the situation where Build it Higher refused to pay the additional 25,000 Euros to Superior View Limited due to Fields Trust going bankrupt. Superior View has the right to go ahead and make a claim of the funds since the duty being considered had turned out to be impossible to carry out and as such, made the original contract to be aggregated and a new one developed. The doctrine of frustration can be said to have been applied in the case of Hartley v Ponsonby and Thomas v Thomas (1842) 2 QB 851. The same principle is also applicable in the situation where Build it Higher has refused to pay Superior View (Stone and Devenney, 2015). Another fundamental case to be pointed out is in William v Roffey Bros and Nicholls (Contractors) LTD {1991}. In this case, the subcontractor had entered into a contract with the main contractor to undertake some work in carpentry. The initial price of the contract was 20, 000 pounds and the main contractor found that the price was an underestimation. He got worried that the original contractor would not be in a position to finish the work within the time they had agreed and would thus have to pay the penalty under the main contract. The major contractor then agreed to give payment to Williams of 10, 300 pound that was also of the original price of the contract of 20,000 pounds after conducting some consultations. However, the main contractor refused to pay thus resulting to the court taking action. It was then decided that subcontractor should be entitled to the additional payment since the main contractor had obtained his share of the bargain which was to avoid the penalty clause by giving the subcontractor an additional amount. The judgment was seen as beneficial since the defendant did not enjoy any legal benefit in the case (Wilson et al., 2016). In the situation where Superior View Limited has been subcontracted by Aspray Lakeland to build the conservatories, a similar application as in the case of William v Roffey Bros and Nicholls (Contractors) LTD {1991} can be made. Aspray Lakeland undertook the step to reduce the sales prices of the house to attract clients. However, the move has affected the subcontractors including Superior View Limited where they have had to reduce their outstanding claims by up to 20% and enable Aspray Lakeland Limited, the contractor to reduce the sale of their houses. Superior View Limited and the other subcontractors can take legal action in which case they will be entitled to their full payment of 100, 000 Euros without having to reduce it by 20%. This is as a result of the contract that had been made between the contractor and subcontractors. Additionally, the contractor had already gained from the contract since the construction of the conservatories for the completed houses had been completed at the right time. The case of Stilk v Myrick (1809) is also vital and can be applied in the analysis. Under this one, two sailors abandoned a ship in the process of a voyage and the master made the promise of paying additional money to those who chose to remain. The master refused to pay just as it was in the case of Hartley v Ponsonby (1857). However, the ruling favored the master. It was ruled that the promise for them to be paid was unenforceable as a result of the absence of consideration. The sailors had made a promise to do all they could in the case of an emergency, and thus there was no consideration for the case. Build it High entered into a contract to pay Superior View an extra 25, 000 Euros for them to pay the wages of their employees. This depicted that they had made a part of the payment owed to Superior View. Furthermore, Build it High had also honored the second contract and thus were not to be held responsible for any more payments to Superior View. The fact that Fields Trust, the major contractors have gone bankrupt should also not be blamed on Build it Trust by Superior View since it is beyond their control (Stone and Devenney, 2015). In the case of Pinnel (1602), Cole owned some 8.50 Euros that was to be paid on 11th November. Pinnel then made an appeal and Cole paid 5.11 Euros on 1st October. As such, Pinnel accepted it in complete resolution of the debt. Pinnel then sued Cole for the amount that he was being owed. It was then decided that the payment made in part should not be considered. Nevertheless, the court ruled that the agreement should accept payment in parts and would be binding if the debtor, at the point where the creditor requested availed some form of fresh consideration. The consideration would be provided if the lender agreed to make payments in parts in a different place than what had been initially identified. Moreover, it would also be accepted if payment was made in parts on a date earlier than what had been previously scheduled (Stone and Devenney, 2015). The 25,000 Euros owned to Superior View Limited by Build it High can be observed as a form of debt. However, it has been depicted that Build it High have revoked to undertake the payment since the party where they were expecting the cash from has gone bankrupt. It should thus be ruled that Build It High makes the 25, 000 Euros payment in parts until they complete it after they have proven that they cannot complete it fully at once. In the Select move Ltd (1995) case, The Crown demanded 25, 000 Euros from Select move since they had paid a moderate amount. Select move then made an agreement with a tax collector that the payment could be made in monthly installments of 1000 Euros. After agreeing with the seven monthly installments, the Crown then sought to finalize with Select move on order as they had payment of a tax of 18,000 Euros. The matter here was whether there was a consideration in the agreement to make payment in monthly installments since the Crown had acquired a sensible gain that they would get paid. It was then decided that there was no consideration and the claim made failed. The argument behind the decision was that there might be a practical benefit as a form of consideration where there is a promise to make an extra payment for the duties that may be in existence. However, this type of practical benefit may not be present when it entails payment of debt in parts (Hannigan, 2008). In Good v Cheesman (1831), the defendant had agreed to take two bills of exchange in which the drawer was the plaintiff. The plaintiff suggested that the accused should meet his creditors with the aim of coming to an agreement before the bills became due and before any action was taken. In the meeting, the defendant entered into an agreement with the creditors, and he was to disburse one-third of his income to a trustee that had to be selected by the creditors. The attendance of the meeting by the plaintiff was however not clear but it was certain that he did not sign the agreement. Besides, there was proof that the agreement had been with the plaintiff for a specified period and had been duly stamped before the trial took place. The court held that the agreement had bound the plaintiff and as such, the action was discharged (Meeson and Kimbell, 2013). This case may be compared with Select move Ltd (1995) in that they were both dismissed by lack of consideration. In the Central London Property Trust Ltd v High Tree House (1947), it was bound that a landlord who had made the promise to accept 1, 250 Euros rather than what was contained in the contract which was 2,500 Euros as rent was guided by the pledge. This was despite the fact that at common law, there was no thought for the promise. The decision was by the promissory estoppel that states that a party that has been injured can recover the damages if they occurred due to a promise that had been made by a promisor. On the other hand, the promise has to be significant so as to prompt the promisee to take action. Certain aspects should be present in the doctrine of promissory estoppel. The promisee should have depended on the promise, should have suffered an extraordinary form of damage and should have made an outstanding commitment that resulted in the promisee to act. This policy exists as a result of lack of a contract (Monaghan and Monaghan, 2013). Fields Trust has gone into liquidation and as such, would not be in a position to give payment to Aspray Lakeland Limited that has then denied payment to Superior View Limited. As such, this may be another possible decision that may be made by the law when sorting out the issue. However, it is significant to have a contract present in these cases as it will assist in smoothening the process in most situations that may arise. The proposal to reduce the sale of prices by Aspray Lakeland Limited can also be declined by Superior View Limited and other subcontractors by the lack of a contract or any form of promise as well. The aspect has been brought up in an abrupt manner and as such can even be seen as a form of harassment to all the subcontractors. Central London Property Trust Ltd v High Trees House (1947) case can be supported by CompagnieNoga D ‘importation et D’ Exportation SA V Abacha (No 2) [2003]. There was an appeal that entailed the implementation of three settlement agreements. The court came to the decision that one of the accords was void for doubt. This is as a result of the terms of the agreement that did not offer the figure of settlement. On the other hand, the consideration to give up the advantage of an entire waiver in a single contract was provided by the communal discharge of executory promises (McKendrick, 2012). In this case, two elements are evident. There is the executed and executory contract. The executed contract is where the promises are developed and accomplished immediately. As for the executory contract, the promises that have been made in the contract are not entirely performed instantly (Mann and Roberts 2015). Several issues in the analysis can be sorted through these concepts. Superior View Limited was not able to pay wages for their employees, and this would have delayed the construction of the conservatories resulting to damaging the image of Fields Trust. As such, Superior View Limited made a contract with Fields Trust where they were assisted in paying the wages of the workers thus preventing a strike from occurring and further ensuring that the work is completed on time. The contract also came into existence as a result of Fields Trust having the desire to reduce the rate of delays that may have led to the occurrence of loss of potential buyers for the new house (Kozolchyk, 2014). On the other hand, the executed contract is also evident in the payment of the 25,000 Euros to Superior View Limited by Build it High. The payment was to remove pending wages of employees for the erection of the conservatories to proceed without any form of delays or hitches. Despite this action being defined as a contract, it can still be seen as a kind of promise that was fulfilled immediately and the construction continued. References KERSHAW, D., 2012. Company law in context: text and materials. Oxford, U.K., Oxford University Press. KOZOLCHYK, B., 2014. Comparative Commercial Contracts. West Academic. http://www.myilibrary.com?id=746613. Mann, Richard A, and Barry S Roberts. Essentials of Business Law and the Legal Environment. Cengage Learning, 2015. Meeson, Nigel, and John Kimbell. Admiralty Jurisdiction and Practice. Taylor & Francis, 2013. MCKENDRICK, E. (2012). Contract law: text, cases, and materials. Oxford, U.K., Oxford University Press. Monaghan, Nicola, and Chris Monaghan., 2013. Beginning Contract Law. Routledge. Poole, Jim., 2014. Textbook on Contract Law. Oxford University Press. Stone, Richard, and James Devenney., 2015. The Modern Law of Contract. Routledge. TODD, S., BURROWS, J. F., & FINN, J., 2011. Contract law in New Zealand. Alphen aan den Rijn, Kluwer Law International. WILSON, S. R., RUTHERFORD, H., STOREY, T., & WORTLEY, N., 2016. English legal system. Read More