l01 2 3 4 contract negligence fw finally unit 5

8/11/2019 L01 2 3 4 Contract Negligence FW Finally Unit 5

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School of Business and Finances

HND Business

Unit 5: Aspects of the contract and negligence

Lul Mohamed Mohamud.

Student ID: M1009526

Assessor: Yasmin

11 / 12 / 2013

L01 and L02

1. The purpose

This work is concerned with the aspects of contracts and negligence for business. It contains the

answers to Nikhil who asked advice as he does not know what to do with the supposed breach

of certain contracts. The purpose is to apply the content of all the relevant aspects of the law

such as the elements of the contract, terms of the contract but also analyses types of contracts

and their impact on business.

2. Introduction

A business contact is always under legal obligations and must learn the business law in order to

manage the affairs of business.


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Agreements between parties can lead in a legal contract that might be enforced in the courts.

The agreement creates obligations and rights from parties, the offeror and the offeree.

Most important, the objective of the agreement is to ensure that expectations created by the

contract are fulfilled and legal remedies are available when one of the parties binding by a

contract fails to comply with its obligations. The party affected can go to de court to request an

action for damages for breach of contract.

In order to avoid misunderstanding, the contract establish a set of rights and obligations to

ensure business relationships, the settlement of legitimate disputes when is affected. The

contract must be knowable, obeyed voluntarily, and must be just and reasonable according with

business law.

3. Understand the essential elements of a valid contract

The importance of all the elements of a valid contract

The elements of the contract are important because they content what of the offer can be

accepted, the intention and conditions binding in a legally agreement, fixed rights and duties of

each part, the acceptance of the contract and the legal consequences in case one of the parts

involucre into the contract do not make its obligations. The contract is required and it must exist

in order to set specific terms and conditions and in some cases include exceptions, warrantiesand exclusion clauses.

A contract has these elements:

An offer made by the offeror with the intention if the offer is accepted, then both parts are

binding with a legal contract. The acceptance is made by the offeree who realise the terms and

conditions and express the willingness to continue the process.

The consideration is per example a promise to give a book but if that person kept the book

then the other part can go to the court to have the book. This person does not give considerationto the promise. Consideration to proven that one part promise to give some benefits to the other

part and vice versa. These mutual interactions make the contract valid. Past consideration is not

adequate for a binding contract.

The Intention to create legal relations such as arrangements of commercial natural are

presumed to be intended legally binding but arrangements of social nature are presumed not to


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be intended legally binding and also The object of the contract is legal. There are not restrictions

by the law or institutions to set the contract.

The contractual capacity means that no one is mental impaired or intoxicated. . The parties

must have competence to contract . Age, condition or status renders are presumed to be

limitations for certain persons to bind themselves by a contract. When a company acts outside

its power has not competence to set a contract.

The contract can be avoidable when a minor while under 18, so voidable is another element of

the contract, meaning the contract must have absence of factors that invalidate a contract such

as duress or due influence, mistake, misrepresentation or illegality. These factors are the

Absence of vitiating factors.

4. Is Nikhil liable to pay Namita 2000 that she is demanding?

Nikhil offered to Namita 3000 in full and final settlement to ended his debit. He also offered to

pay that amount the same day if Namita accepted his offer. Namita accepted and Nikhil

transferred 3000 to her account. There is an offer and an acceptance.

Namita considered the arrangement informal and demanded more money. However, she had

forgotten that commercial arrangements are presumed to be legally binding.

The intention is clear from both parts to end the contract by paying and receiving 3000 as afinal settlement of the Nikhils debit. There was a lawful object on the arrangement.

Consideration is the recompense to Namita as she had 3000 deposited into her account. The

promise from Nikhil to Namita was brought. Both Nikhil and Namita were competent to contract.

It seems no Namita neither Nikhil had any condition, mental disabilities or were under aged

when arranged the verbal contract. Both were of sound mind, conscious, when they entered into

the contract.

The bilateral agreement was not legal preceded, sanctioned by law or institutions or had legal

formalities written or required by statutes.

The oral contract between Nikhil and Namita was a perfect valid contract with all its elements to

end their commercial relation by paying and receiving 3000. Therefore Nikhil is not liable to

pay 2000 demanding by Namita. When the parties come to an end they do not have any more

obligations.


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4. Discuss the impact of different types of contract

Types of contracts

Contracts by deed is a legal document signed, witnessed and delivered usually to create a

legal obligation such as sell of transfer a property.

The Unilateral contract in which only one part express promises and the other part no give

something in return.

The Bilateral contract in which two or more parts are involved. Both parts are bound

Unconscionable contract is one which one person mentally competent can accept. The case of

consumers which are exploit as they are unable to shop in a competitive marketplace. Simple

contract are informal contracts and can be in written, oral or may be implied from conduct.

When a contract is made in a written document is a formally contract and have the assumption

that contains all the agreements between parties. Prior to signing the document must be clear,

understanding and presented to the parties to be valid. The document also requires to be

recognised and must look like a contract no as a simple note or receipt. The terms and

conditions have to be read and agreed before to sign by the parties.

Verbal agreements are valid when all the elements of the contract are present. These types of

contracts rely on the good faith of the involved parts and it is difficult to be proven.

5. Explain misrepresentation in the law of contract and discuss whether Brian has a

possible claim under the Misrepresentation Act 1967

Misrepresentation exists when the information given has not warranty to be true but the other

party presumes it to be true. If a person commits a breach of duty without intention but gains

advantage for himself, he is guilty of misrepresentation.It would be very important to know the difference between misrepresentation and fraud. While

the former has no intention, the latest is a promise with intention to not perform.

Misrepresentation occurs when one of the parties convince the other part to accept a false

statement.


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6. A letter from Vicky informing the intention to sue him for breach of contract

There is a counter-offer when Vicky offered to buy the van for 4000. The oral contract is valid

as it had all the elements of the contract and Nikhil accepted. However there is an anticipatory

breach of contract as Nikhil sold the van to Bryan on 5 March. Nikhil has not consideration to

Vicky as he agreed to maintain the offer open for her until 7 March. So, if Vicky sued him she will

be entitled for damages as the offer cease to exist when the time is up on 7 March and he fault

to inform her to withdrawal his offer.

7. Case law between Nikhil and Charlie

Nikhil made an invitation to treat to Charlie. After that Charlie request information (does he can

pay by statements? which is not a counter-offer and Nikhil said no.

However the first offer continued open. Nikhil did not inform Charlie of any withdrawal. Nikhil

should inform Charlie that he changed mind before Charlie accept his offer. Hence there was a

binding contract, and Charlie can sue Nikhil for breach of contract.

8. Sporta Ltd denying Nikhils claim and pointing out their exemption clause.

In this bilateral contract a document has not been signed but Sporta must demonstrate that has

done reasonable steps to attract the attention of Nikhil before the contract is made. The party

wishes exempt his liability for negligence must make sure the other party has understood that.

As soon as Nikhil accepted the conditions Nikhil remained in the premises.

The notice present ambiguities and in terms of negligence the fact that one party entered into

the contract doesnt mean the other party evade respon sibility. If negligence is mentioned

explicitly then liability for negligence is excluded. The question is, if the injury is reasonable

foreseen that Nikhil might step into the Jacuzzi and cut his foot. There is certain that the broken

glass was negligentl y left by the Sportas cleaner. Nikhil establish that Sporta owed him a duty of

care which depends on the type of loss in relation of personal injury and property stolen. Nikhil

found strict liability as he can proof carelessness from the cleaner.


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The note has ambiguous terms: All the persons use the premises at their own risk. Then the

clause is imposed by one part because the note has not been constructed by natural meaning of

the words, hence the other party was not capable to understand it completely.

There is not specification whether the injury is a result of the careless activities of the customer

which states on the large notices inside the changing room. However in this case the cleaner is

responsible and the company can be sued for negligence. On the other hand theft, loss or

damage in the exclusion clause was well informed. So the company is not liability to pay for

these damages.

The Unfair Terms in Consumer Contracts Regulations 1999, which protect consumers from

unfair standard terms in contra cts. If the courts think a term is unfair, then its not binding on the

consumer.

9. Conclusions

Usually people do offers and acceptances without knowledge how a promise can be an

agreement with obligations and consequences. An offer to treat when is accepted become a

promise but if one of the elements of the contract is absent, the contract is invalid. Breach of

contract occurs when the parties binding in a contract fail to perform their obligations. In other

words the party avoiding the conclusion of the contract is obligated to recompense the party

affected for losses, thus the law gives rights to claim for compelling it to conclude the contract.

The best practice in business in order to success is to exchange ideas, ask questions about the

requirement and obligations and clearly define risks between parties. When the conclusion of

the contract is made according to the legislation and satisfy both parties the working relationship

are clearly determined by a notification of its acceptance.

The termination of an offer and acceptance which end the contract can be provoced by

revocation, withdrawal, cancellation, failure to meet obligations, death of one of the parties,

refusal of counter-offer, subsequent illegally or destruction of subject matter. A breach of contract has actions for damages in favour of the part affected by the fall of

performance of the other part no matter what form of nature the breach of contract is. And

usually to cover damages the affected part is entitles to monetary sum fixed by the court.

However the suffered must show what they have loss and demonstrate with evidences. All


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agreements are contracts when parties have the intention to bind in a contract, are competent

and are able to give free consent so the object of the agreement must be valid by law.

In the modern economy companies make few contracts with all terms characterized by

essentially, but each contract signed must be verified according to the needs of the transaction

including the essential exclusion clauses in most commercial agreements. Inability to analyse

contracts means that the organization cannot analyse its business. Business to maximise

productivity needs to be able to create contracts with customers and suppliers but most

important to analyse and minimize risk at the same time.

In general business must be aware in all areas of contract management, from creating contracts

to tracking contractual risks. When business is unaware of the risk, it cannot present accurately

certifications and disclosures to investors and regulators. Organizations can ensure better

management of contracts to help reduce cost and increase revenues. A broken contract processslows down sales and increase corporate risk. If businesses want to increase operations,

maximise profitability and reduce contractual risks, it must improve the practice of contract

management and be able to accurately to track the contractual risk.

It is considerable and practicable in business relationships as individual agreements, to

estipulate in a written contract the obligations concerning with the kind of transaction to avoid

contractual disputes as legal regulation will evaluate the purpose of the agreements but also all

the terms included during the construction of the contract.

Bibliographies and Links

Business study guide, Edexcel, Persons

http://www.businessballs.com/businesscontractstermsdefinitionsglossary.htm

http://www.ocr.org.uk/Images/139937-level-3-unit-16-apects-of-contract-and-business-

law.pdf

http://toolkit.smallbiz.nsw.gov.au/part/5/35/167

http://shivamlawworld.blogspot.co.uk/2012/02/essential-elements-of-valid-contract.html

http://www.fdean.com/negligence.aspx

http://www.slideshare.net/KenishaBrowning/breach-of-duty-6146745
http://www.businessballs.com/businesscontractstermsdefinitionsglossary.htmhttp://www.businessballs.com/businesscontractstermsdefinitionsglossary.htmhttp://www.ocr.org.uk/Images/139937-level-3-unit-16-apects-of-contract-and-business-law.pdfhttp://www.ocr.org.uk/Images/139937-level-3-unit-16-apects-of-contract-and-business-law.pdfhttp://www.ocr.org.uk/Images/139937-level-3-unit-16-apects-of-contract-and-business-law.pdfhttp://www.ocr.org.uk/Images/139937-level-3-unit-16-apects-of-contract-and-business-law.pdfhttp://www.ocr.org.uk/Images/139937-level-3-unit-16-apects-of-contract-and-business-law.pdfhttp://toolkit.smallbiz.nsw.gov.au/part/5/35/167http://toolkit.smallbiz.nsw.gov.au/part/5/35/167http://shivamlawworld.blogspot.co.uk/2012/02/essential-elements-of-valid-contract.htmlhttp://shivamlawworld.blogspot.co.uk/2012/02/essential-elements-of-valid-contract.htmlhttp://www.fdean.com/negligence.aspxhttp://www.fdean.com/negligence.aspxhttp://www.slideshare.net/KenishaBrowning/breach-of-duty-6146745http://www.slideshare.net/KenishaBrowning/breach-of-duty-6146745http://www.slideshare.net/KenishaBrowning/breach-of-duty-6146745http://www.slideshare.net/KenishaBrowning/breach-of-duty-6146745http://www.fdean.com/negligence.aspxhttp://www.fdean.com/negligence.aspxhttp://shivamlawworld.blogspot.co.uk/2012/02/essential-elements-of-valid-contract.htmlhttp://shivamlawworld.blogspot.co.uk/2012/02/essential-elements-of-valid-contract.htmlhttp://toolkit.smallbiz.nsw.gov.au/part/5/35/167http://toolkit.smallbiz.nsw.gov.au/part/5/35/167http://www.ocr.org.uk/Images/139937-level-3-unit-16-apects-of-contract-and-business-law.pdfhttp://www.ocr.org.uk/Images/139937-level-3-unit-16-apects-of-contract-and-business-law.pdfhttp://www.businessballs.com/businesscontractstermsdefinitionsglossary.htmhttp://www.businessballs.com/businesscontractstermsdefinitionsglossary.htm


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http://www.slideshare.net/susmitarautraya/business-law-12571833

HND Business

Unit 5: Aspects of the contract and negligence

Lul Mohamed Mohamud.


Assessor: Yasmin

16 / 12 / 2013

L03 Understand the principles of negligence in business activities

L04 Be able to apply the principles of negligence in business situations

Understand the principles of negligence in business activities

1. Purpose

The purpose to this report is to provide law concepts related to tort of negligence and vicariously

liability which might affects business and additionally apply the elements that law requires to

establish duty of care in given situations. This is a brief explanation of tort theory and the tests

used by court to find liability under the Occupiers liabilities 1957 and 1984. A table to identify

relevant issues related to liability in tort in contrast with contractual liability was made to analyse

each case and be more willing to apply aspects of negligence. Before concluding there are

possibly suggestions about liability based on principles of tort low cases which the House of

Lord following the Court of Appeal set the modern English law.

2. Introduction
http://www.slideshare.net/susmitarautraya/business-law-12571833http://www.slideshare.net/susmitarautraya/business-law-12571833


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The law of tort was developed in order to establish social legislation and civil

responsibility to find liability where a citizen is harmed from others. It becomes important

to create better awareness of duty of care in the society and the law of tort objectives is

to compensate for loss or damages caused from breach the duty of care.

The word tort comes from Latin and means wrong or crooked. In law, tort means that an

individual has made something wrong. The Tort law refers to compensation for damages caused

for acts or omissions done by a civil to another citizen. A breach of a duty imposed by law such

as take care of the neighbour returns a remedy to the injury person as recognition when he has

any loss from the conduct of the wrong doer.

Lord Akin for mulate the neighbour principle: You must take reasonable care to avoid acts or

omission which you can reasonable foresee would be likely to injure your neighbour,

considering a neighbour every one who can be affected from others acts.

Fault liability can be intentional or negligent. Where there is proven than the injury neither was

intentional nor negligence is described as pure accident and is not actionable.

However some torts has liability regardless of intention or negligence and are described as strict

liability and the court no need fault but the analysis of the reasonable care to avoid harm to

another person.

Negligence is a term used in common law tort and the court will considered the balance of

probabilities, if the defendant owed a duty of care by filing to meet standard of care required and

there are loss and damages as a result of negligently acts.

Pecuniary damage suffers the plaintiff and the responsible for act careless causing injury to

other person is the defendant or tortfeasor.

The elements that in the law of tort the breach of duty of care or negligence the court will

analyses:

Existence of duty of care

Breach of that duty

Injury or loss suffered

The harm was reasonable foreseeable

Relation of proximity between the defendant and the plaintiff

It is fair, just and reasonable to impose liability on the defendant


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Differences between tort liability and contractual liability

Tortious liability is liability that arise by negligence Contractual liability is defined as liability under

contract or agreement

Related to the negligence of duty of care Voluntary agreement between parties

With respect to persons with whom there is not contractual

liability

Each part promise each other certain things

Is more of imposed nature Breach of contract means that one of the parties fail to

perform its obligations

The sufferer can only claim damages There are legal remedies to the injury party

More freedom in contractual law

3. Duties and Standards of care owed by an occupier under The Occupiers Liabilities

Acts 1957 and 1984

The Occupiers Liability Act, 1957 regulates the nature of the duty imposed by law and

obligations of a person occupying or having control over any premises owed to his visitors in

respect of danger due to the state of the premises or to things to be done on them and also

things have been omitted causing harm to visitors.

It also includes rules of the common law to any invitations or permission to enter or use the

premises. The purpose of the rules is to identify who is the occupier, invitees or licensees.

(1) An occupier of premises owes the same duty, the common duty of care, to all his visitors,

except in so far as he is free to and does extend, restrict, modify or exclude his duty to any

visitor or visitor s by agreement or otherwise.

(2) The common duty of care is a duty to take such care as in all the circumstances of the case

is reasonable to see that the visitor will be reasonably safe in using the premises for the

purposes for which he is invited or permitted by the occupier to be there.


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(3)In this section stranger to the contract means a person not for the time being entitled to the

benefit of the contract as a party to it or as the successor by assignment or otherwise of a party

to it, and accordingly includes a party to the contract who has ceased to be so entitled.

arising from any default by him in carrying out that obligation, as if he were an occupier of the

premises and those persons or their goods were there by his invitation or permission (but

without any contract)

Occupiers Liability Act 1984, 1984 CHAPTER 3

Visitors are any person and the occupier owes a duty to another (not being his visitor) in respect

of any risk he knows is danger and he has to take reasonable decisions to protect his visitors.

Any duty owed by virtue of this section in respect of a risk may, in an appropriate case, be

discharged by taking such steps as are reasonable in all the circumstances of the case to give

warning of the danger concerned or to discourage persons from incurring the risk.

(6)No duty is owed by virtue of this section to any person in respect of risks willingly accepted as

his by that person (the question whether a risk was so accepted to be decided on the same

principles as in other cases in which one person owes a duty of care to another).

(8)Where a person owes a duty by virtue of this section, he does not, by reason of any breach

of the duty, incur any liability in respect of any loss of or damage to property.

Factors to analyse the claims of John, Ashley and Glenn

The modern approach to determine whether a duty of care exist apply three test based on

Foresight relates to the neighbour principle

Proximity considering the close relationship between parties and is an important factor

concerning the extended liability for economic loss.

The consideration of justice to impose a duty based on the existence of duty of care

The three criteria will be applied separately and have to be proved.

The analysis of the three criteria of the claim of John has not been invited


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Foresight: Wayne put on the door a notice of Dangerous steps as he knew there was a

danger to anyone entering to the cellar. Wayne also, did not know that John will arrive

from the back door and fall into the cellar as a result he will smash his Rolex and break

his wrist.

Proximity: John was not invited to the party, so Wayne was not related to foresight whatwould happen to John.

Consideration of justice: There is not fair and reasonable to impose duty to Wayne as he

foresight the danger and put a notice on the door warning the danger to avoid accidents.

Wayne will be discharged by taken this action and he did not know what John was going

to do. It can be said that John assumed voluntarily all responsibilities where he entered

to the premises without permission.

The analysis of the three criteria to the claim of Ashley who has been invited

Foresight: First, It can be said that the bad laid flooring could harm anyone. In this case

Wayne unintentionally did not take actions to inform his visitors of the danger. But also

the owner can be vicariously liable if he did not inform Wayne of the danger under the

Occupiers Liability Act, 1957.

o 1) Where premises are occupied by any person under a tenancy which puts on

the landlord an obligation to that person for the maintenance or repair of the

premises, the landlord shall owe to all persons who or whose goods may from

time to time be lawfully on the premises the same duty, in respect of darn.

o Secondly the bucket of bleach was placed neglected and caused burns to Ashley.

In addition bleach damages his cloths. These accidents could be foreseen but

Wayne did not take any action to avoid the accident.

Proximity: There was a close proximity as Wayne invited Ashley.

Consideration of justice: Ashley can have compensation for damages from Wayne butalso from the Landlord. All depends what factors the court will take in consideration to

establish whether Wayne have duty of care and it is fair and reasonable to impose duty.

The analysis of the three criteria to the claim of Glen who was invited


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It is not foresight the action of Glen to leave the premises climbing over the garden wall.

It is assumed that Glen voluntarily assumed responsibility by taken such risk.

It was proximity as Wayne invited Glen to the party.

Glen action is not reasonable to climb the gardens wall so Wayne has not liability forbreach duty of care and it would be not fair and reasonable to impose duty to Wayne.

4. The test applied in the tort of negligence

The actual law tort is base in the Caparo v Dickman case (1990) where to find a duty situation

the case has three factors to satisfy the breach of duty.

On the other hand the common law Duty of care established negligence as a separate tort. Lord

Aitkins speech in Donoghue v Stevenson, 1932 refers to the Neighbour Principle:

The rule that you are to love your neighbour becomes in law, you must not injure your

neighbour and the lawyer's question. You must take reasonable care to avoid acts or omissions

which you can reasonably foresee would be likely to injure your neighbour.

(Foreseeability) Who, then, in law is my neighbour? The answer seems to be persons who

are so closely and directly affected by my act (Proximity) that I ought reasonably to have them

in contemplation as being so affected when I am directing my mind to the acts or omissions

which are called in question.

The nature of liability in negligence referrers to a careless conduct of an individual and in law the

term negligence means the breach of duty.

The principle becomes law to protect citizens from acts of negligence of other citizens.

The law of tort includes:

Personal security (tort of trespass and negligence)

Personal reputation (tort of defamation)

Property rights (tort of trespass and conversion)Economic and financial interest (tort of

trespass and conversion)

The court would take into consideration if the defendant took reasonable steps to avoid harm,

loss or damages to other person and also the close relationship between parties meaning how

directly one person was affected by the intentional action or omission of other.


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5. Caparo v Dickman

Facts that the court will consider to establish breach of duty of care

Wayne and Rio had invested in shares but the company Fidelity Ltd have them shown

negligently prepared accounts hiding true financial position of the company.

The three part test has basically three elements

Reasonable foresight of harm (Donoghue v Stevenson, 1932) is based on the neighbour

principle whether a reasonable person would have seen risks or damages to another

citizen. The auditors Careless & Co have reasonable foresight that the make-up

accounts will cause loss and damages to Rio. They knew the bad financial position of thecompany which would harm any decision taken by investors.

Sufficient proximity of relation is between Careless & Co as they sent intentionally false

accounts to Rio to persuade him to buy shares. An also Wayne decision was based on

the same figures shown to Rio.

It is fair and reasonable to impose duty of care to as they breach de duty of care

intentionally doing negligently reports.

All three parts satisfied a duty of care may be imposed and the actions ca be proven to impose

duty to Careless & Co.

The Caparo v Dickm an test says:

1. The loss must be foreseeable

2. The relationship between the parties must be sufficiently proximate

3. It must be fair just and reasonable to impose the duty. An depend on the proximity of the

relationship between that parties

6. The House of Lord establish no duty of care between Caparo and Dickman. They consideredthat an annual report is to inform but could not be taken as guidance to decide to buy shares.

However in the case of Wayne and Rio, Careless and Co intentionally send the make-up report

to persuade Rio to buy shares. Negligent misstatement (Hedley v Heller, 1964) was carelessly

made to persuade as a consequence he and Wayne lost their investment. There were great

proximity and reasonable reliance, thus the person who made the statement has voluntary


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assumed responsibility and then Careless & Co. is liable for the loss because they produce the

report only to persuade Rio rather that inform the public in general.

Therefore, whether the duty of care exits, where a professional adversely affect people making

false statements, they are liable under s2 (1) Misrepresentation Act 1967 .

In addition the accountants were negligently in giving advice by preparing false reports and in

Candler v Crane Christmas & co 1951 established that any duty of care on behalf of the

accounts would give rise to an action under the law of contract rather than tort. The duty of care

by a professional to his clients is now ruled and the use of a disclaimer Section 2(2) of the Unfair

Contract Terms Act 1977 in relation to loss or damages (no related to death or personal injury) a

person cannot so exclude or restrict his liability for negligence. So Wayne and Rio are likely to

success in a claim for negligent misstatement against Careless & co. The duty of care is owedbecause the advisor have special skills and knowledge that their advice would be relied upon

and they voluntarily assume responsibility an Rio and Wayne can prove that as the result of

negligent advice they suffered loss.

However Due to the companies Act 2006 Auditors can have limit on their liability to a certain

financial amount.

7. Davids liability to Peter and Ella. The three criteria to analyse Davids case that justpassed driving test.

David r eversed negligently over Peters legs and was seriously injured. Peter was drunk this day

and Ella Peters sister was not there but when arrived was shocked and develop psychiatric

illness.

As David just passed his driving test is foreseen that he has not enough experience and

he should take more care and perhaps he should go out of the car to find out if peoplewas near the care at risk.

Proximity test satisfy as Peter was there when David reversed. However if peter were not

drunk exist the possibility that Peter could prevent the accident and then David has not

liability.

But it is fair just and reasonable to impose duty to David as he acted negligently.


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On the other hand Ella was not in the place when the accident happened. This is not the case of

nervous shock. Ella cannot seek damages as a result of the Davids negligence (Bourhill v

Young, 1943). There was not proximity between Ella and David. So Ella was a not foreseeable

victim of the negligence of David.

Ella has to prove that she has developed a positive psychiatric illness (Lord Bridge in McLoghlin

v Obrian, 1983) including cli nical depression, personality changes and post-traumatic stress

disorder with clinical evidences. In addition Ella can be a secondary victim who was not in

physical danger when the accident happened but as the result of what she saw after the

accident she was shocked. Moreover the court will take into the case the proximity to the

shocking incident in terms of time and place, the nature and cause of the psychiatric injury and

the relationship between Ella and Peter who is the primary victim to restrict liability to David.

So those who suffer psychiatric injury are owed duty of care only when they are emotional tie to

the primary victims and fill the other two tests such as a result of sudden shock and the

claimants proximity to the shocking accident.

David can breach the duty of care once reasonable foreseeability is establish plus the other

three tests are proved.

Concept of vicarious liability

Vicarious liability refers how an employer will be held liable for any tort committed while an

employee is conducting their duties. Vicarious liability considers the circumstances where the

defendant is found guilty even if they dont commit the offences themselves. It could happen that

employees commit the tort when working outside the work place going to meet a client the

employer will be liable for the action of a careless employee.

This liability has expanded in recent years following the decision in Lister v Hesley Hall (2001),

to better cover intentional torts, such as sexual assault and deceit. However the incident

occurred just before David went to the office. David was not performing his duties while the

accident happened.

Frank could not foresight that David came with his car to the office. Moreover there was not

proximity as Frank completely ignore David might come with his car. Frank may not be liable for

the wrong action of David thus it is not fair and reasonable to impose duty to Frank.


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How business can be vicariously liable. Business can be affected in two ways:

1. The employer is liable where three conditions occur:

a. A tort action is committed

b. A tort was committed by an employeec. The employee committed a tort while working

2. One person can be liable for the torts committed by another person

Vicarious liability is where one person is held liable for the torts of another, even though that

person did not commit the act itself. Though it looks easy, in practice it is not easy as we think to

determine if these conditions are met. Let us take it one by one. The employers can be held

liable if only the action committed by the employee was a tort.

8. Conclusions

It can be said that people owed duty of care to others in the society and rules impose

duty to protect any citizen from the negligence of others.

The duty of care is not a rule to help others or to look after them. In fact are duties to avoid injury

or damages, thus if there is no duty there no apply liability. However the law find liability when aperson knowing that other is in danger to harm or loss, did not act to prevent such situation.

Torts are acts causing damages or harm to another party. A tort is a civil wrong, and the

wronged person sues in civil court for compensation or an injunction against repetition. In

contrast, contractual liability exists when there is a contract that voluntarily binds parties

together. Contractual agreement is relevant to both parties which assumed voluntarily

obligations and damages are based on losses that are expected. The individual-justice of tort is

more abstract

Tort law like contractual law applies to persons and companies. The law of tort is a result of

legislation while the low of contract is a result of agreements. In law of tort, legislation applies to

everyone that is affected based on loss and gives compensation for damages.

Duty of care is a common law principle and tort actions are not agreements between parties to

bind in a contract. In addition tortfeasors are not sentenced to prison through civil courts.


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Nevertheless, even when a general duty of care is owed a defendant will still not be liable unless

the type of harm sustained was also foreseen. There are some exemptions in case of dead or

severe damages but tort theory is abstract and the decision of the court depends on the

reflexion whether exist duty of care and on the reaction an intention of the defendant to the

protect other party.

Employers owed a duty of care towards employees to be safe at work and the relationship

between employers and employees is close, so any wrong act from employees while working

arise vicarious liability. An employer is strictly liable for torts committed by those under his

command, when they are found to be his employees .

In business, employers have to pay the consequences of the employees acts and thus business

must take decisions to reduce risks by employees and to ensure precautions are taken while

conducting business.

Furthermore the duty of care is a legal duty which applies to the actions of all citizens. A tort is a

branch of the civil law (as opposed to criminal law) based on a claim that the defendant has

caused injury or loss to the claimant by breaking a relevant obligation imposed by the general

law.

It can be said also that a professional owed duty to people they advise and choose to restrict

liability by warning people to not rely on their guidance. Tort law measures negligence based on

the skills of the person and the legal quality of the services, guidance or advice given. Generalrules of English law tort apply to professional negligence by those who claim under the Supply of

Goods and Services Act 1982 where an implied term is included relating to the standard of care

to satisfy contractual obligation as the same as in negligence. The consequences to make

mistakes using excess of the abilities and skills to their clients and, can have huge negative

effects.

Finally the issues related to tort law and the legal process, aspects of contracts and negligence

may be useful to understand the principles imposed by law, to be better citizens, to know howpeople are protected and what kind of remedies exists when someone is harm or has loss as a

result of wrong acts from others. Obligations are important before take actions but most

important is to treat others with equal respect and the law tort is set to make it true.

9. Bibliography and Links
http://en.wikipedia.org/wiki/Employerhttp://en.wikipedia.org/wiki/Employerhttp://en.wikipedia.org/wiki/Employerhttp://en.wikipedia.org/wiki/Employeeshttp://en.wikipedia.org/wiki/Employeeshttp://en.wikipedia.org/wiki/Employeeshttp://en.wikipedia.org/wiki/Employeeshttp://en.wikipedia.org/wiki/Employer


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Business study guide, Edexcel, Persons

http://www.markedbyteachers.com/international-baccalaureate/

http://www.lawteacher.net/contract-law/essays/contractual-and-tortious-liability-analysis.php

http://www.legislation.gov.uk/ukpga/1984/3

http://books.google.co.uk/books?id=KwtpCC7U-

U8C&pg=PA29&lpg=PA29&dq=Part+3+fair+just+and+reasonable&source=bl&ots=YDEPYJ1Cc

G&sig=nyOfSzkIapftMKpRwUahft89EuM&hl=en&sa=X&ei=bcTBUva2EoOrhAed34DgBw&ved=

0CEkQ6AEwAw#v=onepage&q=Part%203%20fair%20just%20and%20reasonable&f=false

http://www.oup.com/uk/orc/bin/9780199299997/taylor_chap06.pdf

http://en.wikipedia.org/wiki/Professional_negligence_in_English_law

http://duhaime.org/legalresources/contracts/lawarticle-88/part-3-consideration-deeds.aspx

http://www.law.northwestern.edu/lawreview/v103/n4/1765/LR103n4Solomon.pdf

http://www.frc.org.uk/Our-Work/Publications/APB/ISA-450-Evaluation-of-misstatements-

identified-dur.aspx

http://www.findlaw.co.uk/law/government/constitutional_law/500400.html

https://www.google.co.uk/webhp?tab=mw&ei=FovEUufUFYznPN3lgZAC&ved=0CAUQqS4oAg&

gws_rd=cr#q=Hedley+v+Heller

http://www.legislation.gov.uk/ukpga/1984/3
http://www.markedbyteachers.com/international-baccalaureate/http://www.lawteacher.net/contract-law/essays/contractual-and-tortious-liability-analysis.phphttp://www.lawteacher.net/contract-law/essays/contractual-and-tortious-liability-analysis.phphttp://www.legislation.gov.uk/ukpga/1984/3http://www.legislation.gov.uk/ukpga/1984/3http://books.google.co.uk/books?id=KwtpCC7U-U8C&pg=PA29&lpg=PA29&dq=Part+3+fair+just+and+reasonable&source=bl&ots=YDEPYJ1CcG&sig=nyOfSzkIapftMKpRwUahft89EuM&hl=en&sa=X&ei=bcTBUva2EoOrhAed34DgBw&ved=0CEkQ6AEwAw#v=onepage&q=Part%203%20fair%20just%20and%20reasonable&f=falsehttp://books.google.co.uk/books?id=KwtpCC7U-U8C&pg=PA29&lpg=PA29&dq=Part+3+fair+just+and+reasonable&source=bl&ots=YDEPYJ1CcG&sig=nyOfSzkIapftMKpRwUahft89EuM&hl=en&sa=X&ei=bcTBUva2EoOrhAed34DgBw&ved=0CEkQ6AEwAw#v=onepage&q=Part%203%20fair%20just%20and%20reasonable&f=falsehttp://books.google.co.uk/books?id=KwtpCC7U-U8C&pg=PA29&lpg=PA29&dq=Part+3+fair+just+and+reasonable&source=bl&ots=YDEPYJ1CcG&sig=nyOfSzkIapftMKpRwUahft89EuM&hl=en&sa=X&ei=bcTBUva2EoOrhAed34DgBw&ved=0CEkQ6AEwAw#v=onepage&q=Part%203%20fair%20just%20and%20reasonable&f=falsehttp://books.google.co.uk/books?id=KwtpCC7U-U8C&pg=PA29&lpg=PA29&dq=Part+3+fair+just+and+reasonable&source=bl&ots=YDEPYJ1CcG&sig=nyOfSzkIapftMKpRwUahft89EuM&hl=en&sa=X&ei=bcTBUva2EoOrhAed34DgBw&ved=0CEkQ6AEwAw#v=onepage&q=Part%203%20fair%20just%20and%20reasonable&f=falsehttp://books.google.co.uk/books?id=KwtpCC7U-U8C&pg=PA29&lpg=PA29&dq=Part+3+fair+just+and+reasonable&source=bl&ots=YDEPYJ1CcG&sig=nyOfSzkIapftMKpRwUahft89EuM&hl=en&sa=X&ei=bcTBUva2EoOrhAed34DgBw&ved=0CEkQ6AEwAw#v=onepage&q=Part%203%20fair%20just%20and%20reasonable&f=falsehttp://www.oup.com/uk/orc/bin/9780199299997/taylor_chap06.pdfhttp://en.wikipedia.org/wiki/Professional_negligence_in_English_lawhttp://en.wikipedia.org/wiki/Professional_negligence_in_English_lawhttp://duhaime.org/legalresources/contracts/lawarticle-88/part-3-consideration-deeds.aspxhttp://www.law.northwestern.edu/lawreview/v103/n4/1765/LR103n4Solomon.pdfhttp://www.frc.org.uk/Our-Work/Publications/APB/ISA-450-Evaluation-of-misstatements-identified-dur.aspxhttp://www.frc.org.uk/Our-Work/Publications/APB/ISA-450-Evaluation-of-misstatements-identified-dur.aspxhttp://www.frc.org.uk/Our-Work/Publications/APB/ISA-450-Evaluation-of-misstatements-identified-dur.aspxhttp://www.findlaw.co.uk/law/government/constitutional_law/500400.htmlhttp://www.findlaw.co.uk/law/government/constitutional_law/500400.htmlhttps://www.google.co.uk/webhp?tab=mw&ei=FovEUufUFYznPN3lgZAC&ved=0CAUQqS4oAg&gws_rd=cr#q=Hedley+v+Hellerhttps://www.google.co.uk/webhp?tab=mw&ei=FovEUufUFYznPN3lgZAC&ved=0CAUQqS4oAg&gws_rd=cr#q=Hedley+v+Hellerhttp://www.legislation.gov.uk/ukpga/1984/3http://www.legislation.gov.uk/ukpga/1984/3https://www.google.co.uk/webhp?tab=mw&ei=FovEUufUFYznPN3lgZAC&ved=0CAUQqS4oAg&gws_rd=cr#q=Hedley+v+Hellerhttps://www.google.co.uk/webhp?tab=mw&ei=FovEUufUFYznPN3lgZAC&ved=0CAUQqS4oAg&gws_rd=cr#q=Hedley+v+Hellerhttp://www.findlaw.co.uk/law/government/constitutional_law/500400.htmlhttp://www.frc.org.uk/Our-Work/Publications/APB/ISA-450-Evaluation-of-misstatements-identified-dur.aspxhttp://www.frc.org.uk/Our-Work/Publications/APB/ISA-450-Evaluation-of-misstatements-identified-dur.aspxhttp://www.law.northwestern.edu/lawreview/v103/n4/1765/LR103n4Solomon.pdfhttp://duhaime.org/legalresources/contracts/lawarticle-88/part-3-consideration-deeds.aspxhttp://en.wikipedia.org/wiki/Professional_negligence_in_English_lawhttp://www.oup.com/uk/orc/bin/9780199299997/taylor_chap06.pdfhttp://books.google.co.uk/books?id=KwtpCC7U-U8C&pg=PA29&lpg=PA29&dq=Part+3+fair+just+and+reasonable&source=bl&ots=YDEPYJ1CcG&sig=nyOfSzkIapftMKpRwUahft89EuM&hl=en&sa=X&ei=bcTBUva2EoOrhAed34DgBw&ved=0CEkQ6AEwAw#v=onepage&q=Part%203%20fair%20just%20and%20reasonable&f=falsehttp://books.google.co.uk/books?id=KwtpCC7U-U8C&pg=PA29&lpg=PA29&dq=Part+3+fair+just+and+reasonable&source=bl&ots=YDEPYJ1CcG&sig=nyOfSzkIapftMKpRwUahft89EuM&hl=en&sa=X&ei=bcTBUva2EoOrhAed34DgBw&ved=0CEkQ6AEwAw#v=onepage&q=Part%203%20fair%20just%20and%20reasonable&f=falsehttp://books.google.co.uk/books?id=KwtpCC7U-U8C&pg=PA29&lpg=PA29&dq=Part+3+fair+just+and+reasonable&source=bl&ots=YDEPYJ1CcG&sig=nyOfSzkIapftMKpRwUahft89EuM&hl=en&sa=X&ei=bcTBUva2EoOrhAed34DgBw&ved=0CEkQ6AEwAw#v=onepage&q=Part%203%20fair%20just%20and%20reasonable&f=falsehttp://books.google.co.uk/books?id=KwtpCC7U-U8C&pg=PA29&lpg=PA29&dq=Part+3+fair+just+and+reasonable&source=bl&ots=YDEPYJ1CcG&sig=nyOfSzkIapftMKpRwUahft89EuM&hl=en&sa=X&ei=bcTBUva2EoOrhAed34DgBw&ved=0CEkQ6AEwAw#v=onepage&q=Part%203%20fair%20just%20and%20reasonable&f=falsehttp://www.legislation.gov.uk/ukpga/1984/3http://www.lawteacher.net/contract-law/essays/contractual-and-tortious-liability-analysis.phphttp://www.markedbyteachers.com/international-baccalaureate/


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HND Business

The importance of the law of contract

Lul Mohamed


Assessor: Yasmin

20 / 12 / 2013

UNIT 1 AND 2

1. Understand the essential elements of a valid contract

a. What are the elements of the contract Offer Acceptance Intention to bind in a contractual agreement Capacity Voidable = legal agreement

b. Missing words Bilateral all part assume Unilateral only one part assume

c. Types of contracts Unilateral Bilateral

d. What are the types of terms in the contract Condition Warranty Implied Express Innominate Exclusion clauses


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e. Differences between Term and Condition in a contract

Terms Condition

Is an statement to be included as part of oneagreement

Only if a condition is performed the contract is valid

Term can have more meaning Very important term in a contract and the breach of it entitlesthe other party to terminate

Could determine time: mortgage can have 5years

Can covering not every element of the contract

Can compass all the elements of the contractor can be very specific

Is an information required to validate the contract

Can be written or verbally agree Express condition is specific and define term in a contract

Required by law such as the NationalMinimum WagesIn collective agreements such as trade unionsor staff associations

Implied condition is presumed by a low upon a nature of theparticular transaction and what is reasonable to do if anyparticular event occurs

Implied termEmployees not stealing companys belongs Employer provide safe and secureenvironment to staff

Precedent is a requirement to make the contractenforceable, per example a signature is necessary to itseffectiveness

Subsequent example is a ring engagement as a gift which isconsidered a condition upon a marriage. The ownershiprevers to the Groom and the Brides must returns it as shedoes not married him

Concurrent conditions affects both parties which mustperform simultaneously

Condition is a term which has as objective: modify theprincipal obligation praying for specific performance so thecontract can happen

What is the effect of the following within a contract?

Breach ofcondition

Warranty Assurance from theseller to buyer

Indemnity Limitations onliability

Misrepresentation Occurs when a party agree a falsestatement induced to think it is true

Injury toreputation

The offeror is onlyresponsible for theloss and damage ofwhat he sold

Indemnity means theprovider has to payevery loss

usually dontapply toindemnities

Representation means parties are presentduring negotiations and make a contract


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Event of default Subsidiary &collateral provision

Collateral contract gives the affected theright to claim damages

Number andform depend onthe nature of thebusiness andthe agreementof the parties

Innocent misrepresentationBoth parties believe the statement is true

Legal fees canbe exorbitant

Avoid risk and liabilitybetween the buyerand the seller

The period inwhich claim canbe brought

Negligence misrepresentationThe remedy depends of the type ofmisrepresentation

Damage ofrelationship

Buyer is obliged tomitigate any loss

It is not obligationunder indemnity

UK negotiationtax indemnityonlyIndemnities arenegotiated on acase-by-casebasis

Remedy may be rescission and ordamages

The buyer canend the contractat the result of thebreach

Disclosures can bemade againstwarranties but thebuyer could not bringa claim under thewarranties

Disclosures allow thebuyer to claim under anindemnity

If the seller isnot able to fulfilwarranties andindemnity thecontract isworthless

Rescission is the cancellation, revocationof a contract or agreement

Proof of loss must beprovider from thebuyer which cannotend the contract

Disclosures transferthe commercial risk forinformation disclosed tothe buyer

The Misrepresentation Act 1967 providesdetails if the contract is voidable

Innominate terms refer to the effect ofthe breach and if thebuyer was deprived ofthe substantially

benefits of thecontract s

Buyer can recover anyloss with out to prove

Subject to normallegal requirement ofproving loss

Buyer knowledge of abreach enter to thecontract regardless canclaim under anindemnity

Amount necessary tocompensate thepurchaser from anyloss resulting from thebreach

Negotiate a pricereduction

Seek specificcontractual protectionsuch as an indemnity


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Effects to breach a contract: Litigation and dispute

Injury to reputation when it had not performed its part of the agreement

Event of default: Sometimes breaching a contract, especially involves payment of money can

affect the smooth business operation.

Legal fees and compensation are expensive when the subject matter is serious enough

Damage of relationship especially with intention

2. Remedies available to breach a conditionBreach a term Remedy

Legality of

exemption clauses

The Unfair Contract Term Act 1997 The unfair Terms in consumer Contracts Act 1999

Exemption clauses

are unfair terms used

to avoid liability

Can be seen as unreasonable in

case of negligence

Rules surrounding liability in business.

Liability will be present as a result of activities

during business or from business premises

That acts state that if the contract is unfair if there is

significant imbalance in the contract to the disadvantage of

the consumer

Limitation clause

might limited a part of

liability

Limiting liability do not apply in

case of fraud

section 12 outlines consumer is a person who

is not part of the business

section 5(1) states a contractual term which has not been

individually negotiated shall be regarded as unfair if,

contrary to the requirement of good faith, it causes a

significant imbalance in the parties the consumer is subject

to a detrimental case

Exclusion clause

exclude the party from

liability

The contract must to include the

exclusion clause and be signed

Section 2(1) person injury or death that result

from negligence in a contract cannot exclude

or restrict liability

The court will see

fairness within the

contract when

considering liability

A Notice must be a contractual

document

An exclusion can be incorporate

during a course of dealing

Section 2 (2) states if it is f air then a contract

can exclude or restrict liability as a result of

negligence


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Breach a condition Condition is a major term of the contract

Damages, law remedy, terminate(repudiate), the loser pay the cost ofthe both parties under UK law, specific performance

Warranty Is a minor term

Damages, the affected cannot reject the contract, replace the good , theseller can be sued for breach of condition instead of WarrantySubstitution of the articleRemedy provided is expressed in the exemption clause, repair orreplacement

Innominate term refers to the effect of the breach andhow affected was the innocent party to have the rightto end the contractContractual term can be condition, warranty orinnominate terms

Total repudiation of the contract as also if it is seen as a condition orwarranty would not give rise to the right to end the contract

Legality of exemption clauses which their purpose isto change the nature of the contract, exclude orrestrict obligations or liability or rights and remedies

Are reasonable clauses or unfair contract?Limit liability under the contract

1. Those which want to exclude express orimplied terms

2. Attached to the breach of contract by toexclude or restrict liability

3. To exclude or restrict the duty of the party bylimiting the amount of damages recoverable

The UK Law Commissions in their 1975 Reporton ExemptionClauses: The result is that the risk ofcarelessness or of failure to achieve satisfactorystandards of performance is thrown on to theparty who is not responsible for it or who isunable to guard against it. Moreover, by excludingliability for such carelessness or failure, theeconomic pressures to maintain high standards ofperformance are reduced."However the intention to avoid responsibility isclear as there is a notice offering a service orleaving it in most of the premises, car park,restaurants, hotels and usually the consumer hasnot change to negotiate.

It depends on the nature of the contract to claim damages incompensation or discharge of a contractUsually the court looks exemption clauses with disfavour an tries toanalyse the intention clause to find its effectivenessThe contract and exemption clause must be reading and signed at thetime of the contract and might require a notice in addition to thedocument.When terms are printed on the back of the document, the front of theticket must give a notice that conditions are on the back.

Because of the exception clause customers cannot sued but they canclaim damages under negligence.

Misrepresentation 1. Fraudulent = intention to, recklessly as it is

true2. Negligent misrepresentation = carelessly or

without reasonable grounds as to it is true3. Innocent representation = made entirely

without fault thinking it is true

Rescission in cause of fraud and has limit timeRescission when is innocent time might before the affected know it

And or DamagesFor innocent misrepresentation damages in lieu of rescission where thedamages are calculated on the tort principle = out of pocket or on thecontract principle = loss of profitDamages in lieu of rescission- Section 2(2) & (3) Misrepresentation Act1967

4. How can damages be calculated?

Damages refer to the financial compensation pay for a breach of a contract

Measure of lost includes economic value lost between what happened and what would have

happened except for the disruption.


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Damages are assessed at the date of breach of contract and the loss must not be too remote to

be recovered. Taking a review of the language used in a section that contains breach of contract

can give an estimate of the amount of money for damages. Usually is equal to the amount the

affected party have received which is very fact-specific what the contract worthy, plus punitive

damages when the breaching was excessively wrongful.

Conclusions

It is therefore important for all parties to involve thinking carefully and tries to avoid breaches of

contract as the price you will pay to remedy the situation will far outweigh any good you can

possibly receive from an intentional breach.

As it is often said, you should never burn your bridges and having a bad relationship with a

commercial partner will not do well for ones business and should be avoided at all costs.

Contract breaches bring nothing but negative consequences, and as far as possible, parties

should try to stick to their contract obligations to the best of their ability.

The use of the exemption clauses limit negotiations as the party with power might abuse the

position and knowledge of the consumer. This freedom of contract might cause disadvantages

on the offeree because of the lack of knowledge about law and exemption clauses limitations.

Links

https://www.gov.uk/employment-contracts-and-conditions/contract-terms

http://www.hkreform.gov.hk/en/docs/rexemption-e.pdf

HND Business

Aspects of contract and negligence

Unit 5

Lul Mohamed Mohamud

ID M1009526
https://www.gov.uk/employment-contracts-and-conditions/contract-termshttp://www.hkreform.gov.hk/en/docs/rexemption-e.pdfhttp://www.hkreform.gov.hk/en/docs/rexemption-e.pdfhttp://www.hkreform.gov.hk/en/docs/rexemption-e.pdfhttp://www.hkreform.gov.hk/en/docs/rexemption-e.pdfhttps://www.gov.uk/employment-contracts-and-conditions/contract-terms


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Assessor Yasmin

10/12/2013

Aspects of contract individual presentation (made in Power Point)

Elements of a valid contract

An offer

The acceptance

The intention to create legal relations

Consideration

Competence: age, conditions, limitations of one party

Absence of vitiating factors

o Influence

o mistake

o Misrepresentation

o Illegality

o Voidable, no limitations from law or institutions.

CONTRACTS

Aspects of consideration

o Invitation to treat is a preliminary step to do transactions but is not a contract

o Request for information about an offer is not a counter offer. The initial offer remain open

o When the invitation to treat is accepted become a promise

o Invitation to buy is not a contract

o

A contract is open until the offeror withdrawal of his promise and communicate hisdecision

o If one of the elements is absent the contract is invalid

Types of contracts

Unilateral


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Only one part promises

Promise is not exchange for another promise but for an act

Unilateral contracts are accepted by conduct completely performed

Both contracts are equally enforceable in court.

Advertisements are offers

Bilateral

Promise is exchange for another promise

Two parties are contractually bound and mutually understanding of the terms and condition.

It is valid where the offer has an acceptance

It is not enforceable if the type of contract is unclear

Advertisements are invitation to treat = shopping

Contracts examples

Unilateral An offeror who promise 100 in exchange of the act to return his missing dog maybe sued for

breach of contract as the reward promised is not Sale of stolen paid

Bilateral

A bilateral contract to sell stolen goods cannot be enforced in court because is calling for an

illegal act

Oral

The acceptance of an offer is the most important type of promise legally enforced

All are legally enforceable but more difficult to prove

Written


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When a contract is made in a written document is a formally contract and have the assumption

that contains all the agreements between parties. Prior to signing the document must be clear,

understanding and presented to the parties to be valid

Express

Both parties state exactly the terms of the bargain either oral or written at the time the contract is

made.

Implied

Suggest an agreement from the facts and circumstances of the offer and acceptance

The shop owner expects to be paid for his services there is no formal agreement but an implied

contract exists

Advantages of contracts:

Contracts allow people to reach agreements

To understand terms, conditions and excluded clauses

To be entitled for damages, as a result of dead, fraud, misrepresentation from the other party

To be protected against false contracts

Disadvantages of contracts:

Without contracts, promises become vulnerable

Misunderstanding

Forgetfulness

Oral contracts

Terms including in a contract


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The simplest business contract has standard form written term.

The main term is the subject of the contract and the price, warranties, conditions, and

innominate terms are contract terms and may be express or implied.

In an oral contract is difficult to choose which one is a contractual terms or a representation thusis better a written contract to analyse and agree with the terms and conditions that satisfy each

party.

Condition

Is imperative to the contract being valid?

Breach of the condition the contract end

Warranty

Is a promise that some conditions are true?

Express or implied

Implied warranties depend of the nature of the transaction

In the sale of goods implied is usually written.

Termination of the contract

The offeror communicate his revocation of one offer before the acceptance

Dead of the offeree/offeror

Rejection of the offeree

Failure of the conditions

Time remain open until the specific length the time set by the offeror run out

Negligence


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Negligence is the omission to do something reasonable

It is the most common cause of loss to trust

The duty of care is breach when someone fails to reach the standard of care required

Reasonable is a person who is expected to be reasonable competent to perform a task

The person is expected to take more care when the risks of harm is greater

If the person cannot know the standards of care required is in fact dangerous because this

person does not know and protect against risks.

Once the risk is known there may be a breach of duty for omission

Exclusion clauses validity

Two parts are only bound by the terms when the attention is brought before the acceptance

Must to be legal

Cover the 4 corners of the contract only

As soon the contract is signed, the exclusion clause has effect.

Conclusions

Most of contracts are bilateral. One acceptance will bind both sides with a legal contract.

Offers can be addressed to one person or a group as the public at large

You should never sign any contract unless you have read, understand and agree the terms and

conditions written in a contract


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The terms and conditions are legally enforceable

The goods must meet the satisfactory quality given

However more evidence is required about the intention of the parties to refuse or recognize a

breach of contract

In the modern economy are few contracts including a term characterized by essentially but each

contract signed must be verified according to the needs of the transaction including the essential

clauses in most commercial agreements.

Links

http://www.businessballs.com/businesscontractstermsdefinitionsglossary.htm

http://www.ocr.org.uk/Images/139937-level-3-unit-16-apects-of-contract-and-business-law.pdf

http://toolkit.smallbiz.nsw.gov.au/part/5/35/167

http://shivamlawworld.blogspot.co.uk/2012/02/essential-elements-of-valid-contract.html

http://www.fdean.com/negligence.aspx

http://www.slideshare.net/susmitarautraya/business-law-12571833
http://www.businessballs.com/businesscontractstermsdefinitionsglossary.htmhttp://www.businessballs.com/businesscontractstermsdefinitionsglossary.htmhttp://www.ocr.org.uk/Images/139937-level-3-unit-16-apects-of-contract-and-business-law.pdfhttp://www.ocr.org.uk/Images/139937-level-3-unit-16-apects-of-contract-and-business-law.pdfhttp://toolkit.smallbiz.nsw.gov.au/part/5/35/167http://toolkit.smallbiz.nsw.gov.au/part/5/35/167http://shivamlawworld.blogspot.co.uk/2012/02/essential-elements-of-valid-contract.htmlhttp://shivamlawworld.blogspot.co.uk/2012/02/essential-elements-of-valid-contract.htmlhttp://www.fdean.com/negligence.aspxhttp://www.fdean.com/negligence.aspxhttp://www.slideshare.net/susmitarautraya/business-law-12571833http://www.slideshare.net/susmitarautraya/business-law-12571833http://www.slideshare.net/susmitarautraya/business-law-12571833http://www.fdean.com/negligence.aspxhttp://shivamlawworld.blogspot.co.uk/2012/02/essential-elements-of-valid-contract.htmlhttp://toolkit.smallbiz.nsw.gov.au/part/5/35/167http://www.ocr.org.uk/Images/139937-level-3-unit-16-apects-of-contract-and-business-law.pdfhttp://www.businessballs.com/businesscontractstermsdefinitionsglossary.htm

l01 2 3 4 contract negligence fw finally unit 5

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