ASPECTS OF CONTRACT AND NEGLIGENCE
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Table of Contents Introduction..........................................................................................................................................3 Task 1 ...................................................................................................................................................3 Impact and meaning of different types of contracts.........................................................................3 Description and significance of essential elements of contract.......................................................4 Analysis of contractual terms .........................................................................................................8 Task 2..................................................................................................................................................11 Contrast liability in tort with contractual liability .........................................................................11 Nature of liability in negligence....................................................................................................12 Defences under negligence............................................................................................................12 Vicarious Liability.........................................................................................................................13 Conclusion..........................................................................................................................................13 References..........................................................................................................................................14
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INTRODUCTION Contract and negligence law is developed for the maintenance of fairness and justice in society in both the situation of contractual relationship and non-contractual relationship. Through the aspects of contract law, protection is provided to the weaker party from unjustified terms(Havighurst, 2000). All parties are obliged to fulfil their contractual obligations to discharge contract by performance. Further negligence law is introduced to impose duty of care on public in absence of contractual relationship. If parties fail to take care of their duty, then they will be under compulsion to pay damages for the injury to the aggrieved party.
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Present project report aims to evaluate aspects of contract and negligence as per statutory provisions in UK. Report will include discussion on essential elements required to form a valid contract. Further, terms and types of contract will be explained along with its impact. Provided discussion will be supported by previous case precedents for better understanding. Law of negligence will be described in the report along with its principles. In addition to this, defences will be explained to reduce liability in the negligence. In last part of report, vicarious liability will be explained to evaluate duties of employer. Description of statutory provisions will be linked to given case studies to provide justified conclusion.
TASK 1 Impact and meaning of different types of contracts  Face to face contract- Face to face contract are those agreements in which parties are present at same place while formation of contractual deed. This contract is contradictory to distance contract(Laufer and Strudler, 2000). In such contracts, offer and acceptance is provided at the same time. If offer is not accepted by the party then it will be lapsed and then TOLL-FREE NO: +44 2038681671 WHATSAPP NO: +44 7999903324
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it will not be considered for future acceptance. In Mini Case E there is face to face contract between parties. In their agreements deed was prepared at the showroom where both the parties were present(Deaki and et.al., 2007). Distance selling contract- In distance selling contract, deed is prepared through the telephonic or mailing communication. It is because parties are present at the same place (Torgans and Bushaw, 2001). In this contract reasonable time is provided to other party for the acceptance. In distance contract, postal rule is applied which is in contradiction to the general rules of the contract. Example of distance selling contract can be noticed in Mini case A. In this scenario agreement is formed by mailing communication for the sale of dental equipments between Arnold and Fiona. Written contract- This is the most formal and appropriate agreement between parties. In these contracts deed is prepared by parties for future assistance(Owen, 2007). In this deed terms and conditions are described which are required to be fulfilled by parties to discharge contract by performance. If there is contradiction between parties, then dispute is resolved with reference to contractual deed by court of law(Nystén-Haarala, Lee, and Lehto, 2010). This contract is in contradiction with oral contract. It is because oral contract is created on the basis of verbal communication between parties. In the present project scenario written case study can be noticed in Mini case E. In this case scenario there is written contract between parties because deed was prepared by them. Further, most of the parties refer written contract because it is more specified in nature. In addition to this, written contract assist judicial person in resolving disputes. Unilateral and bilateral contract- Unilateral contracts are those agreements in which offer is provided in general. Acceptance by any person will be considered valid to such offers. However, offeree is not obliged to complete their promise made to the party. On the other hand, there is mutual exchange of promises between the parties(Lando and Beale, 2000). In such contract both parties are obliged to fulfil their contractual obligations to discharge contract by performance. If they failed to do so, then they will be obliged to pay damages for contractual breach. Description and significance of essential elements of contract Contract is legal agreement between parties which is formed for the fulfilment of certain promises(Rose, 2009). For creation of enforceable contract, agreement made by parties should be supported by essential elements of contract. Description and significance of these essential elements TOLL-FREE NO: +44 2038681671 EMAIL: help@instantassignmenthelp.com WHATSAPP NO: +44 7999903324 WEBSITE: www.instantassignmenthelp.com ASSIGNMENT WRITING SERVICE
is enumerated below Offer- It is a proposal made by a party to attain consent of other party on particular promise. Offer can be given to specific person or in general. Through general offer, unilateral contract is created by parties in which only primary is obliged for fulfilling their promises (Wheare, 2003.). On the other hand, bilateral contract is created between parties in case if offer is made to the specific person. Offer by the party can be expressed through communication (verbal or telephonic or mailing) or even by implied conduct(Goldman, 2013). In the case precedent of Smith v. Hughes, it was held by the court that validity of contract will be determined on the basis of offer. In addition to this, invitation to treat will not be considered as offer. Invitation to treat is an invitation made to another party to provide offer for certain thing. Example of invitation to treat is auction, menu care of hotel, goods on display etc. In such cases, parties are not obliged to accept the offer made by parties. Acceptance- Acceptance can be defined as an action of consent to the offer made by party. Acceptance can only be provided by the individual (offeree) to whom offer is made. Furthermore, acceptance given by the party should be free from conditions and uncertainties else it will be treated as counter offer(Heine and Kerber, 2002). It is because conditional acceptance leads to the modified offer on which further acceptance is required by other party. For this fact, case of lucy V Zehmer can be refereed. In this case, it was held by the court that individual is required to act as per objectivity of the acceptance made. Consideration- Promises made for the formation of contract is required to be supported by mutual consideration. In legal language consideration is known as pro-quo which means something in return. On the basis of this element, contract should be created for beneficial promises(Kelly and et.al., 2013). Formation of contract in absence of consideration will not be enforceable by law. However, consideration should be adequate but it is not required to be sufficient in eyes of law. This fact was stated from the case study of Thomas v Thomas (1842) 2 QB 851. This statement was provided because court of law is not interested in efficiency of bargaining of parties. Still, consideration should be formed by mutual consent. Intention- Parties is required to intend to enter into contractual relationship to fulfil promises made by them. On the basis of this element charitable and domestic contract are legally enforceable. It is because, these agreements are formed due to love and affection and parties does not intend to create contractual relationship(Marsh, and Soulsby, 2002). Thus, TOLL-FREE NO: +44 2038681671 WHATSAPP NO: +44 7999903324
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in these agreements legal assumption is applied that there is no intention of parties to create contractual relationship. Objective of contract- Contract should be formed by parties for valid and justifiable objective. If motive of contract is prejudice to the interest of public or legislation then it will not be enforceable by law. Objective of this element is to restrict unfair or illegal contracts(Miller, 2011). If objective of agreement is not valid, then it will be treated as Void-ab-initio by law. For example contract formed by kidnapping or terrorism activity will be unenforceable due to inappropriate objective.
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Clause of privity- Clause of privity is a legal doctrine in Contract Act of UK. According to the description made in this doctrine, contractual terms should not be in contradiction to fundamental rights provided to the individual(Schaffer, 2009). If such contradiction are identified in terms of the contract, then term will not be considered as part of the contract. Capacity of parties- For creation of valid contract parties should be legally eligible to enter into contractual relationship. Agreement formed with unqualified person will not be enforceable. Following person are said to unqualified as per statutory provisions of Contract Act of UK Criminal Unsound mind Minor Lunatic Other (disqualification imposed by any Act)(Apme and et al, 2004. ) TOLL-FREE NO: +44 2038681671 WHATSAPP NO: +44 7999903324
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Mini case A Case description In the given case situation, offer was made by Arnold to Fiona for the sale of dental equipments. Offer was made through a letter in this scenario. Arnold wants quick reply because he already had good offers from his colleagues. Fiona wants to accept the offer given by Arnold but she is not sure about her financial condition. Thus, she replied to provide consent but with a condition that she will pay after Christmas. Arnold was engaged in conference thus Fiona leaves this message with his secretary. There was no further reply by Arnold till two weeks so loan was arranged by Fiona to provide acceptance with payment for the dental equipments. She wrote to Arnold for acceptance of offer by providing cheque of £15,000. However, till that time equipments was sold to the another person. Statutory provisions Offer was made through a letter by Arnold in this scenario thus there is distance agreement between parties. Offer made by Arnold is specific as per statutory provisions. However, acceptance made by Fiona is conditional in nature thus it will be treated as counter offer. Through the counter offer of Fiona offer made by Arnold will be cancelled. Thus, Fiona is not entitled to accept the previous offer of Arnold after the counter offer. Decision On the basis of above description it can be said that there is no contractual relationship between parties because of inappropriate acceptance. Initially there was conditional acceptance by Fiona due to which offer made by Arnold was cancelled. Thus, later acceptance with cheque will not be valid because it was not in reasonable time period. Mini case B Case description As per the case description, promise was made by Mrs. Smith to provide reward of £100 to the person who will find her black and white cat “lucky” through an advertisement. On the result of advertisement, performance was given by David to avail the reward announced by Mrs. Smith. To find cat of Mrs. Smith David incur taxi expenses amount £25. Now he is claiming his reward along with the amount of expenditure incurred by him to return her cat. Mrs. Smith is not ready to make payment to David for his performance. TOLL-FREE NO: +44 2038681671 WHATSAPP NO: +44 7999903324
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Statutory provisions In this case scenario, unilateral offer was made by Mrs. Smith because offer was in general through advertisement. Thus, David was entitled to provide acceptance on the offer given by Mrs. Smith. In this case main issue was of consideration. David is claiming his reward along with the amount of expenditure but Mrs. Smith is not ready to pay the additional amount. For this issue statement given by law can be referred that consideration is not required to be sufficient to create valid contract. Decision As per the above statutory provisions, it can be concluded that there is valid contract between David and Mrs. Smith. In this case terms described in advertisement will be valid because performance by David was provided on the basis of it. Thus, by considering these facts Mrs. Smith is entitled to pay only amount of reward announced in advertisement i.e. ÂŁ100. Mini case C Case description In this case situation, Mrs. Harris is owner of three rental houses. She is going for abroad trip thus she asked her neighbour Mr. Ted to collect from tenants on her behalf. Further, Mr. Ted collected the rent for her. Due to gratitude, promise was made by Mrs. Harris that she will pay ÂŁ200 to him for the work. Afterwards she denied for the fulfilment of promise by refusing for payment. Now Mr. Ted is claiming for amount for his work. Statutory provisions In the described scenario, agreement between parties was formed on the basis of gratitude there was no intention of parties to enter into contractual relationship. Moreover, in this case promise was made by Mrs. Harris for past consideration which is not valid. Decision Thus, in this case scenario there is no contractual relationship between parties due to absence of intention and issue of past consideration. Ted is not in position to claim for fulfilment of promise made by Mrs. Harris. Mini case D Case description TOLL-FREE NO: +44 2038681671 WHATSAPP NO: +44 7999903324
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As per the described scenario, Mr. Nash formed an agreement with Inman to make 11 fancy waistcoats with some other things. Inman was minor and he was pursuing graduation from Cambridge University at that time. According to the Nash waistcoats were appropriate as per the lifestyle of the graduate student. Total expenses of 11 fancy waistcoats were ÂŁ145. Father of Inman had provided him sufficient clothes thus they denied for the payment when cost was claimed by Nash.
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Statutory provisions In accordance with the description of essential elements of contract, if agreement is formed by a minor then it will not be enforceable by law. In the present case scenario, Inman is a minor and he was provided sufficient clothes by his father. Decision In this case situation, agreement made by parties cannot be held valid due to incapacity of parties. In this legal fact will be applied that contract with minor will not be enforceable by law. Analysis of contractual terms Statement described in the deed of contract is known as contractual terms. As per the legal description, contractual terms are provisions which are used for the formation of contract. Through these terms, contractual obligation is imposed on parties. Non-fulfilment of these terms can lead to the situation of litigation. Description of types of terms is as follows1. Expressed terms- These terms are inserted through the mutual will of parties to define promises made by them. Express terms of contract can be bifurcated into conditions and warranties(Owen, 2007). Conditions are the main terms on which contract is formed. If parties fails to fulfil conditions of the contract, then they will liable for the contractual and TOLL-FREE NO: +44 2038681671 WHATSAPP NO: +44 7999903324
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breach and aggrieved party is entitled for repudiation of contract(Bhadbhade,
2010).
Warranties are ancillary terms of contract which provides clarification to the main terms of contract. If warranties of the contract is not satisfied through the performance of party, then innocent party can claim damages but they are still liable for fulfilling promises. From the case of Hong Kong Fir Shipping Co Ltd v Kawasaki Kisen Kaisha Ltd concept of innominate terms was introduced. In this case, it was held that damages will be provided in accordance with the effect of breach instead of bifurcation in conditions and warranties. 2. Implied terms- Implied terms are assumed to be part of the contract by court of law. Objective
of
implied
terms
is
to
give
effect
to
the
obvious
intention
of
parties(Collingsworth, 2006). Further, implied terms provides protection to weaker party from unfair terms and conditions (Codelfa Construction Pty Ltd v State Rail Authority of New South Wales). These terms can be implied in fact, implied in law and implied by trade or custom. 3. Exclusion clause- Exclusion clauses of contract is governed by statutory provisions of Unfair Contract Terms Act 1977. These terms provide relief to faulty party in situation of inappropriate performance(Morgan, 2011). Exclusion clauses are considered valid if these are inserted prior to the formation of agreement (Ailsa Craig Fishing v Malvern [1983] 1 WLR 964). In addition to this, terms describing exclusion clauses should not be in contradiction with provisions of law. Mini case E Case description In the given case study, Paul wants to purchase a second hand car. He saw an advertisement given by Slick Cars with a tag line “Definitely the lowest prices in Britain”. Further, in that advertisement it was stated that all car will be provided along with the full tank of petrol, Stereo, radio and Road Fund Tax. On the reference to advertisement, Paul went to showroom for the purchase of car. At the showroom he selects a car Ford Mondeo. Model of car was 1994 and it was available at the price of £3,995. Further, it was stated by salesman that car is used for 30,000 miles and have single owner. At last agreement was signed by Paul for the purchase of car. In the agreement price, colour and registration number of car was stated. Statutory provisions For the purchase of car agreement was signed by Paul thus there is written agreement TOLL-FREE NO: +44 2038681671 WHATSAPP NO: +44 7999903324
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between parties. In their contract, statements stated in the contractual deed will be considered as terms of the contract. Thus terms of the contract are price, colour and registration number of car. Further statements discussed at the time of negotiation but not inserted in the contractual deed will be treated as representations. In this contract, representation will be statement of advertisement that car will be provided along with the additional amenities (full tank of petrol, Stereo, radio and Road Fund Tax) and statement of salesman that car is used for 30,000 miles and have single owner. Further trader's puff in this case situation is “Definitely the lowest prices in Britain” because no person can be sure about the lowest price. Decision Following remedies will be provided to Paul in case if contractual terms are not satisfiedConditions Paul is entitled to terminate if primary conditions of their agreement is not satisfied. He is eligible to refuse for the purchase of car and can claim for damages. Warranties or Representation Paul can claim for damages if ancillary terms of contract is not satisfied but still he will be obliged to fulfil his promise. Trader's Puff No remedy will be provided to Paul if trader's puff comes to be untrue. Mini case F Case description In this case situation, Jim went to Fun Park with his wife and children on weekend. At the Fun Park he provided £1 to stand council for parking and £7 to management for admission. At the entrance of Fun Park warning was stated that “parking will be at the risk of owner”. This warning was not visible to visitors due to the overgrown shrubs. Another warning was stated on the back of ticket that “management of Fun Park will not accept any kind of liability if injury is occurred to the visitors due to their negligence”. Later Jim and his wife was injured due to negligence of management. Further car of Jim also get damaged due to van of strand council. Statutory provisions In the described case scenario, main issue if of exclusion clause stated at entrance of Fun TOLL-FREE NO: +44 2038681671 WHATSAPP NO: +44 7999903324
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Park and back of ticket. Facts of this case is similar to the case precedent of Chapelton v Barry. In the referred case court held that ticket is merely a receipt and terms inserted on it will not be part of the contract. Further Strand council is required to ensure that warning is clearly visible to all the visitors and they should take care of their safety.
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Decision On the basis of above description it can be said that both the exclusion clause are not valid thus it will not be considered for relief.
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TASK 2 Contrast liability in tort with contractual liability Contractual and tort liability are two different aspects as per the contract law. Both are from the area of civil law and they are aiming at providing damages to the party to whom injury have been focused. They are concerned to provide justice to the innocent party. In a situation when contractual parties fail to fulfil their obligations and they do not perform as per the terms of contracts then contractual liability arises. Tort liability on the other hand arises in a situation of negligent behaviours of any party. In such situations the parties do not have contractual relationship(Chandler, 2007). In the cases of trot liability one party let down to provide responsive or expected care to the other party. This kind of negligent behaviours of any party can causes injury to the innocent party. In a contract there can be found a legal or contractual relationship between the parties. In case a party provides valid acceptance against the offer made by other party, contractual relationship arises between them. In tort liability no such contractual relationship can be found between the parties as they do not have any prior contract between them. This liability is imposed by court so that innocent party can claim for damaged against the negligent behaviour other party. It is the reason that tort liability is also known as situational liability(Lachman, 2007). In case the duty of care is presented in the situation and the responsible person breaches duty of care which causes damage to innocent party, tort of negligence arises. The purpose of tort liability is to provide remedy to the injured parted against the negligent act of aggrieved party. Contractual liability on the other hand aiming at bringing the aggrieved party is position of offering non-satisfactory performance to other party. To have the benefits of contractual liability there must be a valid agreement or contract between both the parties, but in trot liability, contract between the parties is not required. Nature of duty is the major difference between the tortuous liability and contractual liability (Marsh and Soulsby, 2002). In case of contractual liability obligations of contractual parties are fixed by both the parties having terms and conditions. On the other hand in trot liabilities the duties are fixed by the law. The tortuous liability is more structured and stricter than contractual liability. In order to identify the difference between contractual and tort liability following cases are referred from e- low sources : Case of contractual liability In 1876 there was a dispute between Poussard and Spiers that explains the basic grounds of contractual liability. As per the case a contractual agreement between claimant and defendant have TOLL-FREE NO: +44 2038681671 EMAIL: help@instantassignmenthelp.com WHATSAPP NO: +44 7999903324 WEBSITE: www.instantassignmenthelp.com ASSIGNMENT WRITING SERVICE
been done for performing an opera singer for three months(Mote, 2013). However, they defendant was unable to perform for the opening night and she was replaced wit a singer. In the present case the parties come into contract as per their own will so there was a contractual liability between both(Best and Banes, 2007). They both were obliged to perform the duties. The court has made decision in the favour of claimant party. Case of tort liability To explain the tort liability the case of Topp v London Country Bus [1993] 1 WLR 976 is referred. In this case, a mini-bus was left in a lay-by overnight by a bus company but the driver forgot to lock the bus and he has left the keys in the ignition. One other driver who was expected to pick the bus was not reached to pick it up. Some thieves have stolen the bus and they did an accident in which a woman was killed. The woman's husband made claim to the bus company. However, court has said that bus company does not owe a duty of care for the acts of third party(Wright, 2001). But the thieves were liable to pay the damages for there criminal act. Nature of liability in negligence Negligence referred as the situation in which one person fails to offer responsible are towards other person. Due to his/ her negligent behaviors the party can face damages or injuries(Hernandez, 2010). In such cases innocent party claim for damages but to claim liability under negligence claimant needs to fulfill principles that are explained in following points
Duty of care- According to duty of care a person is responsible to provide standard care to the another person so that he / she can prevent from any injuries. This is imposed by relevance of principle of neighbour love(Elliot and Quinn, 2009).
Breach of duty- A claim can be made against defendant after proving that the breach of duty is occurred due to negligence (Hernandez, 2010).
Causation- This principle of negligence says that claimant should be incurred because of the negligent act of other party. The injury must be the cause of negligence of defendant party (Clarkson, 2010).
Remote damages- The principle defined that the damages occurred to the innocent party should be predictable.
If injured party is able to satisfy above described criteria, then can claim damages in court from the defendant. Description of available damages is as follows
Special damages : This damages are provided in situation where claimant suffer from
financial loss. TOLL-FREE NO: +44 2038681671 WHATSAPP NO: +44 7999903324
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General damages :This damages are provided in situation where claimant suffer from physical injury.
Punitive damages : This damages are provided in situation if defendant had intention to hurt the claimant.
Defences under negligence In case the party is entitled to have any defence from the followings then he/she is not obliged to provide damages :
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Contributory negligence- In case the claimant itself contributed in the negligence. Thus, they are not entitled to make claim for the recovery of damages. As per the general criteria of law guilty party cannot make claim for the remedy of damages.
Justified- In case the negligent behaviour is justifiable on the basis of provisions of the law(Hollingsworth, 2014). This aspect is stated because if there is no misconduct then liabilities for damages cannot be imposed on parties.
Necessary- In case the negligence was mandatory to conduct for providing relief from liability (Beatty and Samuelson, 2012). This aspect is applied in negligent situations where negligence act is mandatory to be conducted by defendant.
Vicarious Liability Vicarious liability is a form of secondary liability that occurs from the common law of doctrine of agency in which a superior is responsible for the acts of their subordinate bearing the TOLL-FREE NO: +44 2038681671 WHATSAPP NO: +44 7999903324
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liability of any third party (Levinson, 2005). The superior agency relationship covers - masterservant, husband - wife, lawyer -client and teacher - student. The application of liability does not ignore the liability on subordinate (Oughton, Marston and Harvey, 2007). The principles of the liability states that employer is liable for any act of negligence of their employees. The reasons are
When employer has right to avail benefits from the efficiency of employee, then they must be liable for their negligence.
The liability is established as preventative means to ensure employee behave and act in standard manner.
The employer has access to resources of defendant(Vicarious Liability. 2013).
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CONCLUSION From the present report conclusion can be drawn that law of contract and negligence is developed for the maintenance of fairness and justice in society. Objective of contract law is to provide protection to the weaker party from unjustified terms. All parties are obliged to fulfil their contractual obligations to discharge contract by performance. Negligence law is introduced to impose duty of care on public in absence of contractual relationship. If parties fail to take care of their duty, then they will be under compulsion to pay damages for recovery of injury to the aggrieved party. Employers are obliged to care of action of employees else they will be vicariously liable for their negligence. Liability under negligence can be vanished if defendant is entitled to avail defence.
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on 7th March 2015]. Levinson, J., 2005. Vicarious liability for international torts. [Online]. Available through: <http://www.1cor.com/1158/?form_1155.replyids=282> [Accessed on 7th March 2015]. Owen, G. D., 2007. The five elements of negligence. [Online]. Available through: <http://law.hofstra.edu/pdf/academics/journals/lawreview/lrv_issues_v35n04_i01.pdf> [Accessed on 7th March 2015]. Rose,
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