The Legal Concern, the Terms of Agreement and the Conditions of a Contract - Assignment Example

Given name Surname Student number Email Unit name Business Law 1100 Assignment title Assessment Two – Four Step Process and Short Answer Date submitted 6 Sep 2012 Student’s comment to tutor N/G Marker’s comments Recorded mark Marker Comments Part A – Four step process Question 1 Identify the principle or issue of law The legal concern is whether the agreement met by the two parties can be evaluated as a valid contract. Explain the rule(s) of law There are three necessities for the formation of a legally accepted contract; the intention of making the contract, the consideration made to undertake the contract and the agreement- functional transaction reached after a consultation, made between the parties involved. The most significant part of a contract is the agreement thus; if an agreement is not reached or is left incomplete then the law cannot enforce it1. The validity of an agreement is reached or determined when parties have agreed all the things concerning the agreement such as the terms of agreement. In case the items being traded are services or goods then both parties are legally allowed to buy and sell the items. For example, in sales contact, the terms of the agreement is that the items must be identified when the agreement is made and when the sale deals with a service then the eligibility of the service provider is established before the contract is made2. An agreement in a sales contract must display: the quantity, the price of the item and the point of sale. In order to arrive to an agreement then an analysis of the acceptance of commitment of trade and readiness to offer the service or product should be determined. This can be done through a complex or long negotiations. A business offer has to be complete for it to be considered as a reliable offer to be contracted. An offer is also dependable on a certain agreed time that if the time elapses then it is considered an expired offer. For an offer to be complete then the buyer has to make an acceptance either verbally or in written. In Clare v Excel Equip Pty Ltd (2002) 2 All ER 4213 Excel Equip Pty Ltd advertised over the media about the varieties of diamond jewels. The buyer in this case was Clare and the seller was Excel Equip Pty Ltd. The parties has already made an agreement and sealed the contract. They had agreed that the buyer was going to collect the item after making the last deposit which she has already made a deposit-half the amount (Full amount-$700). The seller later found a better deal and had to sell the piece to another client who offered $1200 in cash. However, the Australian court found this to be a bridge of contract. The court thought that the offer and the commitment were not complete. The contract terms and conditions between the parties were broken. The client was ready to buy the item after making a commitment of paying half the price and sure to take the offer after 3 days. Thus, the court established that Excel Equip Pty Ltd bridged the contract hence was to compensate the client a commitment as well offer another sale of the same product if the client was still interested. In addition, Excel Equip Pty Ltd was fined $300 dollars for bridge of legally accepted contract. In the case of Stephen v Julia, Julia had reached to an agreement with Stephen on the sale of the item but the deal was not reached since it was pending the acceptance of Stephen. Later Stephen accepted the offer and made left Julia a message indicating that he was ready to take the offer at $200, but Julia found another client Samantha who was ready to take the item in cash. She completed the sell of the commodity. The question is did Julia’s deal legally accepted and was the contract complete between her and Stephen to mandate the sell? Apply the law to the fact The agreement between Julia and Stephen was not agreed between the two parties. In addition, they had not enforced the agreement since it was pending Stephen’s commitment. The question is was there offer and commitment as well acceptance. For this case the late commitment and acceptance of the offer by Stephen was a legitimate procedure but the two had stipulated the expire time frame of the contract. According to the terms and conditions of sale of Julia she had not come to an agreement that Stephen was the only legitimate buyer of the item and the item was to wait for his conformation on the offer. Draw possible conclusions The agreement for the formation of the contract could not be established since both parties had not agreed to completion on the terms of contract. Thus, the contract is termed as an open contract whereby, the seller and the buyer had the right to drop the offer or the acceptance at any time. Therefore, the contract in this case was not valid. Case referred Clare v Excel Equip Pty Ltd (2002) 2 All ER 421 Other reference Lambiris, M. First Principles of Business Law. Sydney: CCH Australia 2012 Pentony, Brendan, Stephen Graw, David Parker, and Keturah Whitford. Understanding business law. LexisNexis Butterworths, 2013. Question 2 Identify the principle or issue of law The terms of agreement and the conditions of a contract is what are granted by the principle of law. The issue raised in this case is whether Paul’s Racquet Restringing firm will rely on the notice in the firms premise as a clause in the contract. Explain the rule(s) of law Apart from the statements included in the contract nothing else forms part of the contract such as posters, visual aids or representations, but the terms forms part of the contract. Statements made in a contract legally binding terms when bidding terms of contract or during formation of a contract. On the other hand, there are personal terms of contract that which only have two classifications; warranties or conditions4. These two classifications contribute a lot of weight in a contract for example, conditions in the contract constitute to the terms of the contract. It is obvious that parties cannot reach to an agreement if there are other pending questions concerning the contract. In other business contracts there is the existence of a warranty- this is a term that only validates damage claims. Though warranty plays part in contracting it does not play much role as conditions. As in the case of Australian context citizens know the difference between conditions and warranty, but this is not so to the legal understanding of the same5. When undertaking a legal approach concerning a case that concerns the terms of service then the case should be supported by facts. When the terms of contract are supported by law then it means that the contract is supported by statute. Terms of a contract are only agreed in three ways in Australian law; discussed, referred to either a ticket or a notice or signed in a document with all the parties included in the agreement. In a contract that contains exclusion clauses the law permits these exclusions to be explained similarly to the terms of the contracts, but only if they are included in the contract. In the case of Bettner v Penta (1958) VLR 126 Bettner took his husband’s suit to Penta’s dry cleaner for a two days washing. The two agreed on the service fee and duration of contract, but before Bettner left Penta issued her the company’s bronchus which had several statements concerning the service offered the service fees, but importantly one statement stated that the company will don’t be responsible for any deformity or destruction to the cloth. Since Bettner is always busy she could not read the notice. During collections she noted that one of the arms was torn. This issue here was whether the clause in the bronchus was exclusive. The bronchus could be established as a term of contract since the notice only contained contractual terms and service offered. The court ruled that the bronchus is not a defined docket since it only acted as an advertising material. As of the case of Annette v Paul’s Racquet Restringing the notice that appeared at the premise was not exclusive and could not be considered as terms of contract between both parties. The question is if Paul’s Racquet Restringing considered that as a term of contract what will happen to the clients who cannot read- blind? Apply the law to the facts With reference to Australian laws warranties and conditions are treated as different terms. The question is whether Paul’s Racquet Restringing can really on the notice as an exclusion clause in the contract. According to the laws is defined that any statement out of the agreement is not part of the agreement not unless a revision is done to include the statement. Despite the fact that Paul’s Racquet Restringing made clear that they are not going to be responsible for any damage to the client’s item, the law states that the notice in the premise is not exclusive hence Paul’s Racquet Restringing has the legal obligation to compensate the client. Draw possible conclusions Warranty should be included in any terms of contract since it can be used by the clients to see claims or compensation if any damage arises during the warranty period. Addition of exclusion clause to a contract also could be made possible to amend any contract so that Paul’s Racquet Restringing could really on it. Case referred Bettner v Penta (1958) VLR 12 Other reference Lambiris, M. 2012 First Principles of Business Law. Sydney: CCH Australia Latimer, Paul. Australian Business Law 2012. CCH Australia Limited, 2012. Nottage, Luke. "Consumer law reform in Australia: Contemporary and comparative constructive criticism." Queensland U. Tech. L. & Just. J. 9 (2009): 111. Part B Part B– Short answer question There are several factors that separate courts in Australia and at large among the commonwealth nations and states. These factors constitutes to provision of powers that has been granted to courts in making or orders as well as hearing of cases. The decision reached by a court depicts the binding status of the case that the court in mandated to hear. Despite the fact that judges are not the law makers (law making is the due responsibility of the legislature) there are allowed to twist the law while making court decisions. In most cases within courts judges find it hard to apply the law in other specific cases since they may not find the law to apply. In this case the court or the judge has the obligation of using other relevant courts cases are reference case or just apply the decision to for the first time in court. This reference of cases would be borrowed from other countries or from lower or higher cases within the country. In such cases the new decision could be implemented as law if it is ethical and legally applied. The judge has to explain the law and also offer the meaning behind it. Sometimes the judge has also the mandate of deciding a case based on its facts inferred from the ruling decision. With reference to the doctrine of precedent a previous case made in a higher court could be used a decision stand in all the other lower courts. For example, the decision made in the supreme court of Singapore could be used a ‘stare decisis’ as well as a reference stand for courts in Australian courts. Read More