Interest Related to Business Law in APA Style - Essay Example

Running Head: Contract Law Topic of Interest Related to Business Law in APA Style This paper discusses a contract along with the basic elements of a contract. Contract is defined and is explained. The essentials of a contract is also mentioned and studied in detail. Classification of a contract is also examined. Distinctions between unilateral and bilateral contracts are also put forth in this paper. Definition of a contract A contract is a promise between two or more persons and involves interchange of some good or service resulting in a commitment for the breach of which a suit for damages can be filed in a court of law. Thus, Contract involves an agreement but not every agreement is a contract. An agreement, which creates or has the intention to create a legal obligation, is a contract (Bays., 1920). Essentials of Contracts Every contract must contain the following 1. Capacity to enter into contract; Capacity to enter into a contract is the legal capability to enter into a contract. This means that an adult who is of sound mind can enter into a contract. Minors, mentally incapable persons and those who are drunk do not have the capacity to enter into a contract. Law says that when people enter into a contract then they should have the ability to know and understand the terms of a contract (Beatty, & Samuelson, 2006). 2. Offer and acceptance Offer and acceptance according to law is meeting of the minds or 'concurrence of wills' or 'ad idem'. Normally for a contract to be effective must have an offer and an acceptance of that offer. The vital characteristics of a contract are that a person makes an offer with another accepting it. Offer and acceptance need not be always expressed orally or in writing, it can be implied also. The term of a contract if not expressed in words is an implied contract. If obligations are only forced on one party by virtue of acceptance to perform then such contracts are known as unilateral contracts. This was enunciated in the case of Carlill v. Carbolic Smoke Ball Co. (McKendrick, 2005) 3. A legal object; Apart from blatantly illegal contracts like contracts to commit a crime or tort other types of contracts where considered illegal (Frascati, 2005). 4. Consideration Consideration is the vital idea in the law of contracts and is necessary, in the majority cases, for a contract to be enforceable. Consideration is the price, which one has to pay for the promise of another. Consideration can be in the form of money, property, the doing of an act, or even refraining from doing an act and a promise. It means that if one accords to do something he was not otherwise legally compelled to do, then it means that he has given consideration. For instance, "Jack agrees to sell his car to Jill for $100. Jill's payment of $100 (or her promise to do so) is the consideration for Jack's promise to give Jill the car" (William Theophilus, 1912). Classification of Contracts For the sake of analysis, contracts can be classified in many different ways. The most general classifications of contracts are; "express" and "implied" contracts; "void" and "voidable" contracts; and "enforceable" and "unenforceable" contracts. Express and Implied Contracts If the terms of a contract are stated clearly, then such contracts are known as Express contracts. Express contracts may be written or oral. For instance when a valid offer is acknowledged, then it means that an express contract has been created. Implied contracts are generally referred to as "implied in fact." If the specifics of the transaction is not directly negotiated but are make know by the behavior of the parties then such contracts are implied. For example making an appointment with a repairman to have a broken washing machine fixed is an implied contract (http://law.jrank.org/pages/12504/ Contract-Law.html#ixzz0Uy1JwCUw accessed on October 25, 2009). The expression "implied in fact" is used to differentiate implicit arrangement from an "implied in law" contract, or "quasi-contract." A quasi-contract is not a real contract; in fact, it is a legal mechanism, which is not binding and is used in particular conditions to avoid one party from being relentlessly harmed or unfairly enriched by an implicit arrangement (http://law.jrank.org/pages/12504/Contract-Law.html#ixzz0Uy1JwCUw accessed on October 25, 2009). Void and Voidable Contracts A contract if it is void does not exist under law. Under such circumstances even, it both the parties to the contract may have come to an accord it is not recognized as a legal contract. For instance if one party has agreed to perform an illegal act, then such a contract is void. A contract that is illegal in part may be void in that respect. Nevertheless, it becomes valid if the illegal portion is deleted and the purpose of the agreement is not defeated. Accords, in which a critical trait of a valid contract is missing, are void contracts as well. Voidable contracts are agreements that may be called off by one of the two parties involved. A contract may be voidable for a variety of reasons. A voidable contract allows for one of the parties to depart from the agreement without fine (http: //law.jrank. org/pages/12504/Contract-Law.html#ixzz0Uy1JwCUw accessed on October 25, 2009). Void vs. Voidable Contract There is an important distinction between "void" and "Voidable" contracts. Disagreement sometimes comes out from the failure to distinguish the difference. A contract is void when the law declares it to be so emphatically that there is no contract on anything and noalteration in the legal condition of the contract parties; it cannot be approved. A Voidable contract, on the other hand, binds one contractual party but not the other party; it is legally binding until that contractual party who is allowed to nullify it (refuse to do his part of action) annuls it. Until thus dis-confirmed it is binding. It may be accepted. For instance, A accepted to sell a $5,000 automobile to B, a minor. A is bound to supply the automobile and cannot hold that B was not of age of maturity; B may refuse to buy the automobile, in which case A is helpless; B may approve on attaining the age of maturity, that is, agree to finish his part of the contract he had entered into when he was minor (Hillman, 2004). Contracts to sell property are Executory, where as a finished sale by delivery is executed; but the expression used in an agreement about the sale may not all the time be decisive whether the one or the other is intended (Burton, 2008). Enforceable and Unenforceable Contracts A contract may be enforceable or unenforceable. If a legal remedy can be obtained when the contract cannot be completed for any reasons, then such contracts are enforceable contracts. Whereas if some of the statutory requirements are absent in a contract then such contracts are unenforceable contracts. For instance, an oral contract to purchase land would not be enforceable because the Statute of Frauds calls for such an agreement to be in writing. Likewise, statutes of limitations, which limit the duration of time accessible for legal action, to contracts of certain types and render them unenforceable after a certain period of time (http://law.jrank.org/pages/12504/Contract-Law.html#ixzz0Uy1JwCUw accessed on October 25, 2009). Enforcement of Contracts If a party to a contract is not able to fulfill the promise made in a valid and enforceable contract, when the performance is due then such a contract can be said to have been "breached." Legal remedy can be claimed at such points or even before if the actions of the party is clear that there is no intention of fulfilling the agreement on his/her part. Normally in most of the cases, monetary compensation is claimed when there is a breach of contract. There are specialized laws, which regulate damages for many types of contracts, like sales of goods, real estate transactions, and employment contracts (William, 1995). Unilateral vs. Bilateral Contract Unilateral contract is a contract to pay for performance of definite act, if the potential performer prefers to perform. A unilateral contract is distinguished from a bilateral contract, which is an exchange of one assurance for another. An example of a unilateral contract: "I will pay you $1,000 if you take my car from San Francis to co Cleveland." Transferring the car is acceptance. The distinction is normally only of academic interest. (Eisenbergs, 2002). "Where as a Bilateral Contract is a contract in which the contractual parties make promises with one another to do something in the future time." For example, "Smith, a Seller, promises to sell her property to Ponting, a buyer, promises to pay seller $200,000 for it." This is unlike from that of a unilateral contract; in which there is an agreement to pay if the other party decide to do something. "I'll pay you $2,000 if you'll stop smoking" (Burton, 2008). Contractual theory Contract theory is the body of legal theory that covers normative and conceptual questions in contract law. One of the most significant questions asked in contract theory is why contracts are enforced. One important answer to this question centers on the economic benefits of imposing bargains. According to Fried, (1982) the purpose of contractual theory is to enforce promises. Writers have advised about Marxist and feminist interpretations of contract. Another aspect of the theoretical debate in contract is its place within, and association to the law of obligations. Obligations have conventionally been separated into contracts, which are willingly undertaken and allocated to a specific person or persons. Recently a third category that is, restitution obligations, based on the unfair enhancement of the defendant at the plaintiff's expense has been researched. Contractual liability, echoing the constitutional function of contract, is normally for breaking down to make things better (by not rendering the expected performance). Liability in tort is normally for action (as opposed to omission). Liability in restitution is for unfairly taking or holding back the benefit of the plaintiff's money or work (Anson, 1998, p.21). Reference: 1. Anson, B. (1998). Law of contract . USA: Oxford University Press. 2. Atiyah, P.S. (1979). The Rise and fall of freedom of contract. Clarendon Press ISBN 0198253427. 3. Barnett, R.E. (2003). Contracts . Aspen Publishers ISBN 0-7355-6535-2. 4. Bays., A. W. (1920). American commercial law series. Chicago: Callaghan And Company. 5. Beatty, J.F., & Samuelson, S. S. (2006). Introduction to business law. South-Western College/West. 6. Burton, Steven J. (2008). Contract Law: Selected Source Materials, 2008 Edition. New York: West. 7. Eisenbergs, Melvin Aron. (2002). Gilbert Law Summaries: Contracts. New York: Gilberts Law Summaries. 8. Frascati, L. (2005, October 13). Fundamentals of contract law. Retrieved from http://ezinearticles.com/Fundamentals-of-Contract-Law&id=82686 9. Fried, C. (1982). Contract as promise. Harvard University Press. 10.Hillman, Robert A. (2004). Principles of Contract Law. New York: West, pp. 11-21. 11.McKendrick, E. (2005). Contract law - text, cases and materials. Oxford University Press ISBN 0-19-927480-0. 12.William Theophilus, B. (1912). Law of contract. M. Curlander. 13.William, B. (1995). Introduction to the law and legal system of theunited states. . MN: West, : St. Paul. 14.http://law.jrank.org/pages/12504/Contract-Law.html#ixzz0Uy1JwCUw accessed on October 25, 2009 Read More