Aspects of Contract & Negligence for Business

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Unit 5: Aspects of Contract & Negligence for Business|
By Abdul Mir: FCS#307035|
Mark & Jodie Jones|

Contents
Task 1: Formation of a Contract3
Offer & Acceptance3
Acceptance3
Modes of acceptance & E-Contracts4
Consideration4
Intention to Create Legal Relation5
Capacity to contract5
Blue Chip v Evershed5
Task 2: Exclusion & Limitation Clauses6
Contractual Terms7
Conditions7
Warranties7
Innominate Terms7
Advantages&Disadvantages of Using a Standard Form7
Advantages7
Disadvantages8
Task 3: Differences Between Contractual & Tortious Law8
Tortious liability9
Contractual Liability9
Expectation Interest9
Reliance Interest10
Occupiers Liability10
Vicarious Liability11
General Liability12
Strict Liability12

Task 1: Formation of a Contract
Formation of a contract requires the following essentials for a contract to become a legal and a valid contract: * Offer
* Acceptance
* Consideration
* Intention to create legal relation
* Capacity to contract
Offer & Acceptance
For a contract to even take place at first there has to be an offer which then has to be accepted by the party it has been offered to.An offer is made when one party makes it clear, by words or actions that he is prepared to be bound as soon as the offer is accepted by the person to whom it is made to. Offer can bilateral or unilateral, for example, if I was to tell a friend of mine that I’m going to sell my iPod to him for £50, this will be a bilateral, if an offer was placed in a newspaper (Carlill V Smokeball Co.). An offer is quite different from an invitation to treat, though it is not always easy to distinguish the two. In the case of Fisher v Bell D put a knife to sell on a window with the price tag hanging. It was a statutory offence under the Restriction of Offensive Weapons Act 1959. The Divisional Court took a literal interpretation of the statute and said he had committed no offence: the display was an invitation to treat, not an offer to sell. The court came to that decision because a shop keeper can deny selling the Counter offer is not an acceptance. A case example of this would be Hyde v Wrench, in this case D made an offer to sell his farm for £1000; P rejected and made a counter- offer which was then rejected by D. P then revived the original offer himself and accepted it. Reviving an old offer is not allowed to be revived by the offeree (Rolls court). The court came to that ruling because when P made the counter offer the original offer was not valid anymore therefore when P’s counter offer was rejected therefore he should’ve made an offer to buy the land for the price he was first asked for as he was now the offeror. Acceptance

No contract can come into an existence until there is an acceptance or an agreement and in most cases acceptance is communicated to the offeror. Case example of this can be Carlill V Smokeball Co. In this case P accepted the offer by buying the smokeball because it stated the offer can be accepted by buying a smoke ball and uses it as directed. On the other hand the offeror can generally specify the method by which acceptance is to be communicated. This was presented through the case of Compagnie de Commerce v Parkinson Stovewhere PP specially said that acceptance can only be notified on a pre-printed from. DD accepted through a letter and later on cancelled its order. The court of appeal said that there was no valid acceptance hence there was no binding contract. The court came to that decision because PP waived the condition as to the mode of acceptance which was only on a pre- printed form. Modes of acceptance & E-Contracts

There are different ways in which an offer can be accepted they are known as modes of acceptance. Silence cannot be acceptance; the general rule is that in order to be valid, an acceptance must be communicated to the offeror (Felthouse v Bindley). There are,...
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