Business Law, Policy, and Ethics - Essay Example

Business Law The majority of businesses selling online have totally inadequate terms and conditions. Although a dull topic, it is nevertheless crucial to your business to consider the small print. Businesses need to regulate and have written procedures for use of technology both internally and externally. This involves having a written IT policy on matters such as data protection, email, and internet. By having clear policies a business protects itself by complying with regulatory requirements as well as by reducing its own exposure to risks. Once a policy is in place, disciplinary action may be taken against employees if they disregard the policies. It is important to set up the site properly so as to protect the business (for example, by ensuring that your terms are accepted before transactions proceed to contract formation), and to comply with the law. Betty was willing to buy BMWS from Andrew thus why she discussed prices and various options with Andrew. Betty said wanted 12 cars top of the range and the next day Andrew telephoned Betty leaving a message on Betty's telephone answer machine offering to sell the cars for $ 38,000 each .in order for an offer to be an enforceable contract, certain basic requirements must be present. There must be an agreement based upon genuine concert of the parties supported by consideration and made for a lawful object between competent parties. (Hussain pg 114, 2002). An offer may be byword of mouth in writing or by conduct. After the discussion between Betty and Andrew the Later agreed to sell the BMWS at $ 38,000 each which was communicated to Betty. The moment a person express his acceptance of an offer the very moment the contract is concluded and does not matter whether the acceptance is byword of mouth or in witting. A contract is complete only when acceptance is actually communicated to the offer. Betty accepted to buy the $ 38,000 through an email she sent to her personal assistance (Carol) who forwarded it to Andrew. For this case the contract of the sale became binding immediately the email of acceptance from Betty was forwarded to Andrew. Carol was Betty's personal assistance and she acted as an agent to her. Her agency was created through an agency by necessity. Law may confer an authority where an agent acted by reason and genuine emergency with a view to protecting his principal's goods, which are in danger of being perished. Her action must have been performed in good faith. She must not assume the role of an agent of necessity unless she is unable to communicate with Betty to obtain fresh instructions. Carol could not have gone ahead and accepted key for the 12 BMW'S without getting fresh instructions from Betty knowing very well she had changed her mind and wanted convertible BMWs at the same price. Hence she is liable for accepting keys to the vehicles without getting further instructions from Betty. Betty is liable to pay for the BMW'S since her personal assistance (carol) intimidated to the seller that he had accepted the good vehicles by accepting the keys. Andrew has rights against Betty and he can sue Betty for the price of the vehicle since the vehicle had been passed to Betty. He can also be entitled to maintain an action for damages if the buyer refuses to accept the delivery and pay for them. Damage is the estimated loss directly and naturally resulting from the buyer's breach of contract. The damages awarded will be different between the contract and the price at the time when the goods ought to have been accepted or if no time was fixed for acceptance, then at the time of the refusal to accept. When Betty asked Andrew to collect his vehicles because she was not going to buy them, Andrew reduced $ 1,000 on cash vehicle. Considered is necessary not for making the contracts, but also for their discharge for example, an agreement to accept the smaller sum in full satisfactory of a large debt is not binding because there is no consideration and the party agreeing to it way sue for the balance. It is however, possible to discharge an existing obligation an accord and satisfactory. Accord and satisfactory occur when one party has performed his obligation under the contract and agrees to accept something different that to which he is entitled under the contract in discharge of his rights. The new agreement is the accord and the carrying out of it is the satisfactory. It is essential that if the agreement is to be enforced consideration should be given by one party in return for the surrender of his rights under the original contract but the other. Thus, a promise of payment is lesser sum than one which is already due cannot be considered foray agreement to treat the debt as discharged. If however, there is afresh consideration the agreement will be enforceable and the original contract held to be discharged (Hussein pg.130, 2002). Carol may defend herself for accepting the keys of the vehicle without fresh instruction from Betty. He may urge that Andrew had said that the cars were popular and he did not want to hold them for long. She feared that someone else would bring the cars and it would have to be hard to get others of that land from the market. A contract, which is an agreement between two or more persons, which is intended to create legally binding obligation. The word binding is used for there are some contracts which are valid but are not enforceable. A valid contract is an agreement, which is binding and enforceable, and it should have all the essentials of a valid contract. Normally the courts do not enforce all agreements coming before them unless there is sufficient evidence to prove the existence of intention to create legal relations. In commercial or business agreement, it is generally presumed by the courts that there is an intention to create legal relations unless the parties insert a clause that their agreement shall not be binding in the law but shall be binding in honour only. For this case the contract of sale between Betty and Andrew had an intention to create legal relation and there was no clause that the contract shall be binding in honour. The case can be resolved by the court of law. Failure by Betty to accept and pay for the vehicles from Andrew discharges the contract. The contract is discharged by breach of the contract. Although every breach of contract provides remedies to the innocent party, this does not necessary discharge a contract. Thus, if a party breaks a term of contract going to its root, known as condition, the party will be released from his obligation under the contract. But if the term broken is collateral to the main term of the contract, known as a warranty, the innocent party will not be released from the performance and can only claim damages. Andrew is entitled for remedies for breach of contract. On breach of contract, the innocent party is entitled to remedies of refusal of further performance, action for damages, action for specific performance and action for injunction. Refusal by Betty to accept and pay for the vehicles makes Andrew to be entitled to remedies of action for damages and specific performance. Damages are the normal remedy for breach of a contract. The aim of the law is to place the injured party as far as possible in the position he would have been if the contract had been performed. However, it is not for every kind of damage that the plaintiff is entitled to recover compensation. In some cases, the law considers that the loss sustained from breach of contract is too remote to merit any compensation. Mitigation of loss: However, when a breach of contract takes place, the party suffering from breach must make all reasonable efforts to minimize his loss and he is entitled to recover those damages, which he could easily have eliminated had he tried. Andrew should minimize the damage by looking for another buyer for the vehicles. Andrew must prove that he tried to sell the vehicles in the available market and claim damages not more than the difference between the contract price and the market price plus any incidental charges. A relevant case is that of: Brace v Calder, 1895 Brace was wrongly dismissed from his service but was immediately offered employment on his previous terms. Brace declined employment and sued for wrongful dismissal. Held that although the dismissal was irregular and was technically a breach of contract, Brace was entitled to nominal damages only. Andrew had a right for the vehicles because Betty had not yet paid them even though he had delivered them to Betty's premises. He has a lien on the vehicles and a limited right for resale. He has a lien on the vehicles for the price as long as the vehicles remain in his possession. This is because the vehicles were sold without any stipulation as to credit. Lien can be exercised for non-payment of price, and not for any other charge. Many contract disputes involve a disagreement between the parties about what terms in the contract require each party to do or refrain from doing. Hence, many rules of contract law pertain to interpretation of terms of a contract that are vague or ambiguous. The parol evidence rule limits what things can be taken into account when trying to interpret a contract. There must be an express or implied agreement. The essential requirement is that there be evidence that the parties had each from an objective perspective engaged in conduct manifesting their assent, and a contract will be formed when the parties have met such a requirement. (Notice that the objective manifestation requirement means that one need not actually have assented so long as a reasonable person would believe that assent had been granted.) For a contract based on offer and acceptance to be enforced, the terms must be capable of determination in a way that it is clear that the parties' assent was given to the same terms. The terms, like the manifestation of assent itself, are determined objectively. A contract can be either an express contract or an implied contract. An express contract is one in which the terms are expressed verbally, either orally or in writing. An implied contract is one in which some of the terms are not expressed in words. An implied contract can either be implied in fact or implied in law. A contract which is implied in fact is one in which the circumstances imply that parties have reached an agreement even though they have not done so expressly. For example, by going to a doctor for a physical, a patient agrees that he will pay a fair price for the service. If he refuses to pay after being examined, he has breached a contract implied in fact. Many contracts provide that all contract disputes must be arbitrated by the parties to the contract, rather than litigated in courts. By law, some contracts, including most securities brokerage contracts, must be arbitrated; other contracts are referred by courts as a matter of local law or policy. Arbitrated judgements are generally enforced and appealed in the same manner as ordinary court judgements; a majority of states have adopted the Uniform Arbitration Act to facilitate the enforcement of arbitrated judgements. In England and Wales, a contract may be enforced by use of a claim, or in urgent cases by applying for an interim injuction to prevent a breach. Bibliography Chirelstein, M, 2001, Concepts and Case Analysis in the Law of Contracts (University Textbook Series), California Gabriel, M, and Peter, G, 1998, International Trade and Business: Law, Policy and Ethics, 4th Edition, Cavendish Publishing, Texas. Gibson, A, Rigby, S & Tamsitt, G 2003, Commercial Law in Principle, 2nd Edition, Lawbook Company, Sydney. Hussain, A, 2002, General Principles and Commercial Law of Kenya, East African Educational Publishers Ltd, Nairobi. Saleemi, N. A, 1999, Commercial Law Simplified, Saleemi Publishers Ltd., Nairobi. Tunner C, 2003, Austraria Commercial Law, 22th Edition, Lawbook Company, Sydney Read More