Georgia and Malcolm Contract - Assignment Example

The Business School Author’s Name Institutional affiliation Date Tutor Introduction A contract refers to an agreement which involves two or more parties. Most contracts are usually written and signed by the parties to it. However, under certain circumstances, parties can enter into an oral agreement. Contracts are binding to the parties to them and there are consequences for breach. (Andrews, 2011) In the present scenario, Georgia and Malcolm enter into a contract for the care of tropical fish and an award winning rabbit. Georgia issues Malcolm with a standard form contract which Malcolm signs without prior reading. The contract has an exemption clause which provides: ‘Georgia maintains the highest standards in animal care. However Georgia will not be liable for death or illness of tropical fish due to their specific vulnerabilities.’ Unfortunately, Georgia feeds the pets with the wrong food leading to deaths for fish and disfiguration for the rabbit where subsequently Malcolm seeks to stop the payment of a cheque already issued to Georgia. The essay examines the contractual issues in the current scenario as well as advising Malcolm whether he can sue Georgia for breach of the contract, and if he can sue, the remedy or remedies that he should seek. Discussion 1. The contractual issues that arise in this situation. In the above scenario, there are a number of contractual issues that arise. For there to be a binding agreement in the above scenario, there must be a number of elements that should be present. A contract should have essential elements which are- offer, acceptance, consideration, intention to be legally bound, mutuality, capacity, and legality. Offer and acceptance are the most important elements in any given contract as the two are central to creating a contract. Malcolm is interested in obtaining pet care services while he is away for one week. (McKendrick, 2012) The discussion that Malcolm engages with Georgia would be termed as invitation to treat since he expresses the wish to have the services provided to him. After the conversation between the two, Georgia makes an offer to Malcolm through the use of a standard form contract which she uses with all her home pet care clients. Since Malcolm is very busy preparing for his trip, he nevertheless signs the contract and returns the same to Georgia together with the agreed amount of US $700 to cover the seven days that Malcolm would be away. From the above it is evident that Georgia made an offer to Malcolm and Malcolm accepted the offer unconditionally by executing the contract. The fact that Malcolm did not read the contract prior to signing it does not affect its validity as held in the case of L’strange v Graucob Ltd (McKendrick, 2012). The contract that Georgia and Malcolm enter into is supported by consideration. In the contract, Georgia commits herself to offer pet care services to the rabbits and the tropical fish. On the other hand, Malcolm agrees to pay an amount of $100 for each day that Georgia takes care of his pets. Georgia's consideration in this contract is taking care of the pets. For Malcolm, the consideration is the $700 dollars for which he issues a cheque to Georgia in return for her taking care of his rabbit and tropical fish. It is evident that Georgia and Malcolm have the intention to be bound. Georgia sends the contract through email which Malcolm subsequently signs and returns. This is an explicit intention to be bound legally under the contractual terms. The element of mutuality is also present since the two parties are clear as to what their respective duties are under the terms of the standard form contract (Blum, 2007). Legal capacity is at the heart of contract making. For one to have capacity to enter into a contract, such a person must be of the majority age, be of sound mind and should not be bankrupt. There are exceptions where a person who is not of age can enter into contract for necessities but this does not have any relevance in the present scenario. It is apparent that Georgia has capacity since she has been running her present business for sometime. Malcolm also appears to be above the age of majority (Blum, 2007). Therefore the two parties have the capacity to enter into contract. The final element to be considered in the contract entered into between the two parties is legality. The question is what the parties contract to do is legal. Pet care business is not criminal and therefore the two parties were not contracting to commit an illegality. From all the foregoing it is apparent that all the elements of a contract have been satisfied and the contract entered into is perfectly in order. 2. Whether Malcolm can sue Georgia for breach of contract and, if so, what remedy or remedies he should seek and whether Georgia has a claim against Malcolm. During the discussions preceding the signing of the contract, Georgia stated that, 'I am a professional, an animal lover and that this should not be a problem'. In the standard form contract, there is a clause to the effect that, ‘Georgia maintains the highest standards in animal care. However Georgia will not be liable for death or illness of tropical fish due to their specific vulnerabilities.’ Unfortunately, while Malcolm is away, Georgia feeds the fish with the food that should be fed on the rabbit. Consequently, Georgia feeds the rabbit with the food intended for the fish. As a result of this tropical fish worth thousands of dollars die while the rabbit loses all its hair owing to the stress emanating from eating fish food. Extensive flooding also results damaging furniture and the house that Malcolm was renting. It is apparent that Malcolm has suffered a lot of losses from the actions of Georgia. Under contract law, there are various remedies available to a party who is innocent and suffers damage (Collins, 2003). Malcolm would be entitled legally to rescind the contract as he has done already by trying to stop payment of the cheque by the bank. Malcolm would also be seeking damages to compensate him for the losses incurred. Malcolm should sue to recover the value of the fish that died which is worth thousands of dollars. Malcolm should also seek compensation for the amount of money that he is unable to earn by showing off his pet rabbit which has lost all the hair. Thirdly, Malcolm should be seeking damages for the loss to furniture while the owner of the house would seek compensation for damage to the house. It is apparent that Georgia would try to shelter under the exemption clause. However, under the contra proferetum rule, such a clause ought to be construed against the person that seeks to rely on it (Stone, 2009). The clause in the above contract is ambiguous and appears to affect the very heart of the agreement. The exemption clause is ‘Georgia maintains the highest standards in animal care. However Georgia will not be liable for death or illness of tropical fish due to their specific vulnerabilities.’ The clause appears to indicate that Georgia is a competent care giver. The difficulty appears in determining what is meant by death or illness of tropical fish due to their specific vulnerabilities. It does not come out very clearly what specific vulnerabilities refers to (Poole, 2012). It is apparent that the exemption clause does not cover the rabbit and thus it should be obvious that she would have little to defend herself against claim for the loss incurred as a result of Malcolm not being able to show off his rabbit. Before Malcolm entered into the contract, Georgia made a misrepresentation that she is competent. A competent pet care giver should obviously know the difference between fish and rabbit food and the consequences of feeding one animal with wrong food. It is apparent that Georgia is negligence. The above scenario suggests that Malcolm should be awarded damages for the loss incurred as well as been titled to rescind the contract (Poole, 2012). The losses should include the amount that he could have earned in showing off the rabbit, the loss of fish as well as furniture. Georgia has no claim against Malcolm as she has not only failed to perform her part, her actions have resulted in unwarranted loss to Malcolm and the landlord. The court should imply the term that Georgia ought to have offered reasonable care to the pets belonging to Malcolm (Young, 2009). Conclusion A contract is a legally binding agreement that involves two or more people. A contract requires a number of elements for it to be enforced in a court of law. In the scenario above, Georgia and Malcolm entered into a contract for the care of tropical fish and a rabbit. As a result of the apparent negligence Georgia, Malcolm suffers huge losses. The scenario brings to the fore the issues of offer and acceptance as well as breach of conditions of a contract which leads to the issue of rescission and award of damages to the injured party. The contract, though perfect on the face of it has some issues which are not right. Georgia makes a misrepresentation as being competent but does not live up to expectations. References Andrews, N. (2011). Contract law. Cambridge: Cambridge University Press. Blum, B. A. (2007). Contracts: Examples & explanations. Austin: Wolters Kluwer Law & Business. Collins, H. (2003). The Law of Conract. Cambridge: Cambridge University Press. McKendrick, E. (2012). Contract law: Text, cases, and materials. Oxford, U.K: Oxford University Press. Poole, J. (2012). Textbook on contract law. Oxford: Oxford University Press. Stone, R. (2009).The Modern Law of Contract. New York: Routledge. Young, M. (2009).Understanding Contract Law. New York: Routledge. Read More