This is a solution of Unit 1 Business Assignment Help in which we discuss Developing business
When a person wants to start a business then the most important thing that needs to be understood is the essentiality applying and understanding the norms, principles, rules and usages of contract in an effective manner. Contract is the valid agreement between two or more than two parties which is enforceable by the law. In every deal of business contract plays an important role. So, it is important for a business man goes through and keeps exact idea regarding the contract law. This assignment explains the primary and basis areas of the contract that should be known by businessmen. In this project report the essentiality of a contract and its impact will be discussed. There are also various more aspects of the contracts will be discussed in this assignment.
Task 1 Understand the essential elements of a valid contract in a business context
1.1 Explain the importance of the essential elements required for the formation of a valid contract.
There are some necessary elements of a valid contract that Mr. William wants every staff members to know and these are describes as below:
Offer is considered as the primary step to initiate a contract and which should be lawful and on the other side, by the other party offer must be accepted in lawful manner. So to make a contract valid there must be lawful offer and acceptance by both the parties. [Meyer (2010)]
In a contract it is important to have a lawful consideration. Consideration is the payment or recompense on which the legal contract could be made. One party gives the reasonable consideration to the other party and the amount and type of the consideration is decided by the both party mutually. See more : Employer-Employee Relationship Assignment Help
Both parties of the contract should be able to create a legal relationship with each other. Both the parties should be mentally, legally and physically vigorous to enter into a contract. [Collins (2008)]
A contract between both the parties should be free consent without any forceful act or coercion. Both parties must be agreed with their own consent and they must be agreed on the same things and at the same manner. A consent would be free when is not created by the undue influences, coercion, fraud, etc. [Richards (2006)]
An object of the contract or an agreement should not be void. Object is different from the consideration. Object defines the reason and purpose of the agreement must be valid. Object is considered as the lawful when it is not fraudulent, it is not prohibited by the law, involves any injury, etc. For example, a house is being taken on rent for gambling purpose, in this case the object is gambling and that is illegal.
1.2 Discuss the impact of different types of contract in terms of forming, binding and enforceable contracts under English law.
There are several types of contracts and they all have their own impact.
In a contract when both parties do something in order to fulfil the contract is known as bilateral contract whereas in unilateral contract when only party has to do something and fulfil the promise to make the contract valid and that promise needs to be accepted by the second party only. [Vettori (2007). A contract said to be implied when the behaviour, activities, conduct of both the party shows that they came into the contract and on the other side in express contract is defined as when both the parties articulate or communicate the entire terms and condition to each other which are necessary for the contract is known as express contracts.
When in a contract all the obligation have been performed in a proper manner that needed to be performed is known as executed contracts and on the other side when any party or all the parties have not performed any responsibility or obligation that needed to be performed is known as executor contracts.
An agreement is said to be void when any party could not be able to implement the agreement legally due to various reason. When law permit any party to pull down the agreement in that case the contract is said to be voidable. Unenforceable agreement is that when all the parties mutually set the consideration but the statement of law generate hurdle to force. Valid agreement is that agreement when all the obligations have been fulfilled by all the parties and that is easy to implement is known as valid agreement. [Nel (2004)]
1.3: Analyse terms in contracts with reference to their meaning and effect:
A condition is referred to such a term wherein the contract would seize to exist if the same is not complied with. Therefore, the term is considered to the elemental to the contract. Such a term is to be fulfilled to complete the execution of the contract.Warranty is referred to as a term wherein when breached the same may be claimed for in damages. It is however to be noted that the contract would continue to function even after claiming the damages in the case of breach as it is secondary to the contract.[Giliker (2010)]
The contracting parties to safeguard the interests of the consumers from the manufacturers and the sellers generally enter into exclusion clauses. This is to show that the certain restrictions on liabilities are valid and the others are not. The terms not valid are specified under the Unfair Contracts Terms Act.The terms that are not specifically mentioned or discussed but are to be performed in general are referred to as the terms that are implied. Such terms are not required to be mentioned as the performance development is implied in nature.
Terms that are essential to the contracts and specific to the contract are considered as the express terms. Such terms are generally present in writing and require to be fulfilled in order to fulfil the terms of the contract. [Meyer (2010)]
Task 2: Be able to apply the elements of a contract in business situations
2.1: Apply the elements of contract in given business scenarios
In the given situation the advertisement so posted by the East End Airways in the trade journal for the second hand Airbus 320 is that of an invitation to offer. The price so quoted to be 12.5 million pounds is a price that may be negotiated once the offer has been made. When the Chief Executive Officer of West Aviation Ltd. Expresses his intention to the EEA’s Managing Director for the purchase of the same airbus. However, he also expressed his unavailability for the next five days as he is visiting New York for a business matter. To this, William specified that in the meantime if another buyer comes along then the same would be sold to that buyer. Furthermore, Harry offered to pay 100,000 Pounds if the same is not sold for the next five days. William thereby agrees to the offer. It is noted that the offer to not sell the air bus for the next five days was made. The agreement so formed is considered to be a valid contract as the offer was made by Harry that was accepted by William. The same was done a consideration and between the legally capacitate parties. Therefore, the agreements so formed in the situation comprised of express terms such as not selling the airbus for the next five days. Thereby the contract so formed would lapse after five days. The implied term is that William would maintain the airbus for the next five days and that the claim may be made if the same is breached by William. It is thereby said that the contract so formed is valid contract according to the elements of the contract. [Cooke (2007)]
2.2: Apply the law on terms in different contracts
The present case illustrates that the Mr. Peters had entered into an agreement with the cycle shop for the repairs of the bicycle that is to be used by him in the cycle race. The same was entered into on basis of the specific terms so agreed to. The repair of the bicycle was a condition to the contract as well acceptance of the goods subject to the terms and conditions. The implied term was that the equipments so used in the repair would be of standard quality. The express terms as well as the warranty was that care would be taken of the bicycles all brought in for the repair?The exclusion term that may be referred to as the essential part is that the care would be taken but the responsibility for the goods would not be taken that are left for the repairs. However, the sign illustrating the terms was put behind the counter and hidden by the bicycle so hung. Mr. Peters was not able to read the same. As the owner of the shop it is required to make the stament expressly clear and noticeable in order to enforce it. As Mr. Peters went to collect the bicycle the same was not repaired and misplaced as it was put into storage along with the wrong tag. This results in a breach of a contract. As the condition to repair was not met and the exclusion clause was not clear the business contract can be voided at the end of Mr. Peters and damages may be claimed for the loss so suffered. [Vettori (2007)]
2.3: Evaluate the effect of different terms in given contracts
The present scenario had a contract that refers to the purchase of 30 cars being made by The Best Cars Ltd from Car World if the same were ready to be used on the roads. In the case whereby the cars so supplied are illegal and no amount of modifications would make a difference would make the term of being immediately able to use the cars would be a condition as the cars cannot be driven unless they are legal. Whereby the repairs are needed to the performed with respect to the engines, the term would be regarded as a warranty as the repair would only amount to a minor delay.Whereby the repairs needed would require a storage time of 3 months, the term in question would be regarded as an innominate term only to be considered condition or warranty if the same is not complied with. [Collins (2008)]
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