Main Aspects of Commercial Law - Coursework Example

Commercial Law Commercial Law Question According to the Law of Contracts, an offer is only binding on acceptance if it is clear, definite, and final. In this case, D’s advertisement cannot be referred to as an offer, rather, it is an invitation to treat, an invitation to negotiate, or an invitation to chaffer. The fact that D advertised on a newspaper shows that he was not offering to sell to a specific person, rather, he was inviting the public to come in and present their offers. Purporting that the advertisement is an offer would mean that D is legally bound to sell to all parties who would accept his terms of $40,000 for the car; this is not true because he is not a car distributor. D, therefore, cannot be contractually obliged to sell more goods than he actually owns. Citing from jurisprudence, the case of Partridge v Crittenden (1968) 2 All ER 421, the defendant advertised in a magazine offering some bramble finches for sale. Section 6 of the Protection of Birds Act 1954 clearly stated that the sale of such wild birds was an offence. He was charged and later appealed against his conviction. Lord Parker CJ of the appeal court stated that advertising to sell the birds was not an offer to sell. He further added that it makes no business sense for advertisements to be classified as offers, since the person advertising would be placing themselves in position where they would have to sell more than they actually owned. For a contract to exist, there must be offer, acceptance, an intention to be legally bound, consideration, and finally, the transaction must be legal. In this case, D’s advertisement was not an offer, so he is not contractually bound to sell to E, therefore, E’s lawsuit is void. In the case of D and F, F inspected the car and later sent a cheque for $40,000 with the condition that if he hears no more about it, he will assume the car to be his. This action by F is an offer, which is only binding if F accepts the offer under the given condition. Though F had already committed himself to closing the offer by sending a cheque for $40,000, the offer is only valid if D communicates his acceptance officially. Acceptance cannot be imposed on D due to his silence, unless it is communicated clearly. In a previous case, Felthouse v Bindley [1862] EWHC CP J35 Court of Common Pleas, a nephew discussed the sale of his horse to the plaintiff, his uncle. The nephew wrote to his uncle following a previous discussion, the uncle replied saying, “If I hear no more about it, I will consider the horse to be mine”. The nephew did not reply, however, he told the defendant, an auctioneer, not to sell the horse. Despite the instruction not to sell, the defendant sold the horse by mistake and the Uncle sued the auctioneer for tort of conversion. Bindley, the auctioneer, argued that there was no valid contract since the nephew had not communicated his acceptance to the uncle’s offer. The jury held that, silence cannot amount to acceptance, therefore, there was no contract. It is, therefore, correct to say that D is not obligated to abide by F’s offer since he has not conducted himself in a manner that vests the property in the car to F. In the case of G, who inspected the car, and was told by D that the car would not be sold to another purchaser for three days. This can be seen as an offer by D to G, however, for it to be legally binding, there has to be some form of consideration that signifies acceptance. The decision by D to sell the car one day later is not actionable since G had not given something in consideration for it. The above case can be proven using the case of Central London Property Trust v High Trees House [1947] KB 130; High trees leased a block of flats from CLP at a rent of £2,500 in 1937. The defendant had a hard time getting tenants for all the flats and the ground rent left High Trees with no profit. In 1940, many flats were still unoccupied and with the World War looming, the situation was not to improve for some time. The plaintiff agreed to lower the rent to £1250 during the War years. The agreement was put in writing and High Trees commenced the reduced rent in 1941. When the war was over, the flats became fully occupied and the claimant sought to return to the originally agreed rent. Justice Denning J held that, full rent was payable from the time that the flats became fully occupied in 1945. The promise was that the rent would be reduced during the War years, therefore, the defendant was estopped from denying what was agreed upon since enough consideration was given in the form of payments and acceptance. In the case of D promising not to sell the car to another purchaser for three days; the facts show that no consideration was given nor accepted, making the promise not to sell a gratuitous promise, therefore, not a legally binding agreement. D, therefore, has no liabilities. Question 2(a) The facts of the case is that two seamen were detained in Vietnam due to drug possession. The rest of the crew was to divide the wages of the two detainees if they safely brought the ship to Hong Kong. The captain did not meet his promise to the crew. The facts of the case show that the rest of the crew were still in a capacity to perform their tasks. Moreover, they were performing tasks within their existing duty, therefore, they were not entitled to the wages of the two detained seamen. In order to best support the answer, it is proper to cite jurisprudence; in the case of Stilk v Myrick (1809), 170ER 1168, the plaintiff, Stilk, was contracted to work as a crew member on a ship owned by Myrick for 5£ a month. In the contract, the two agreed that Stilk would do anything needed in the voyage regardless of any emergencies that may arise. During the voyage, two seamen deserted the ship in Cronstadt leaving the captain and the rest of the crew. The captain, failing to find replacements promised the crew that they would be rewarded with the wages of the missing crewmen if they fulfilled their duties as well as their own. Upon arrival at the final destination, the captain refused to pay the crew what he had promised them. The issue in this jurisprudence was whether a duty bound by an existing contract serves as enough consideration for a new contract. Lord Ellenborough of the King’s Bench Division held that there was no consideration found. This is because the original contract bound Stilk, and all other crewmen to perform any duties on board the ship, therefore, performing the extra tasks of the two crewmen that deserted the ship was not sufficient consideration in light of the new promise. Therefore, it is proper to state that A cannot enforce the promise of the captain since performance of a pre-existing contract is not sufficient consideration. Question 2(b) In the case of ten seamen being arrested and detained, then A could enforce the promise against his captain. To be able to answer this question effectively, it is proper to cite from the case of Hartley v Ponsonby (1857) 7 EB 872, Ponsonby was the captain of “The Mobile”; Hartley, on the other hand, was a member of the crew of 36 seamen. The terms of agreement were that the crew agreed to serve on board the ship on a voyage from Liverpool to Port Phillip; from there they would continue to any ports and places in the Pacific Ocean, Indian or China Seas up until the ship returned to a final port of discharge in the United Kingdom for a term not exceeding 3 years. Hartley’s wages were £3 per month; while the ship was at Port Phillip, 17 of the crew deserted. Of the remaining 19 seamen, only six were competent seamen. Ponsonby proposed to sail for Bombay and instructed the remaining crew to take the ship to Bombay; he promised to pay some of the crew including Hartley with a written promise saying, “I promise to pay, in Liverpool, to Robert Hartley the sum of forty pounds, provided he assists in taking the ship from this port to Bombay with a crew of 19 hands.” When the Mobile arrived in Liverpool, Ponsonby refused to pay the seamen more than the wages originally contracted for. During the case, evidence showed that it was unfit for a crew of 19 to navigate the ship considering only four to six crewmen were competent. The issue raised was whether Hartley had provided any new consideration in return for the promise of the extra wages. The judge, citing from the case of Stilk v Myrick (1809), which held that sailors were not entitled to any additional pay for fulfilling a duty already required by an existing contract, stated that in the case of Hartley v Ponsonby, the sailors were entitled to additional pay. The desertion of so many crewmen in this case changed the nature of the tasks of the remaining seamen. Justices Coleridge and Crompton held that it was unreasonable to risk continuing the voyage, and taking up the task was a risk of life. It is for this reason that the contract was considered to have been discharged, and therefore, there was a right for the crewmen to negotiate a new contract. Therefore, the fact that Ponsonby offered, in writing, to pay the crew to sail back and the acceptance by the crew could be considered an entirely new contract, thus providing valid consideration. Judging from the above, jurisprudence, it is possible to say that A would have a claim against the captain, if ten seamen had deserted the ship, since the rest of the crew would be risking their lives trying to steer a ship without 10 crew members. The offer by the captain would, therefore, be termed as a new contract, and the acceptance by the crew would, therefore, constitute valid consideration. References Central London Property Trust v High Trees House. (n.d.). Central London Property Trust v High Trees House. Retrieved March 31, 2014, from http://www.e lawresources.co.uk/Central-London-Property-Trust-v-High-Trees-House.php Felthouse v Bindley. (n.d.). Felthouse v Bindley. Retrieved March 30, 2014, from http://www.e lawresources.co.uk/Felthouse-v-Bindley.php Hartley v Ponsonby. (n.d.). Hartley v Ponsonby. Retrieved March 31, 2014, from http://www.e lawresources.co.uk/Hartley-v-Ponsonby.php Partridge v Crittenden. (n.d.). Partridge v Crittenden. Retrieved March 30, 2014, from http://www.e-lawresources.co.uk/Partridge-v-Crittenden.php Stilk v Myrick. (n.d.). Stilk v Myrick. Retrieved March 30, 2014, from http://www.e lawresources.co.uk/Stilk-v-Myrick.php Read More