Contract case study

sign on outcome theatreContract Case StudyContracts be a sound salad dressing agreement make between devil or more parties to flow on and to accept each the scathe cover version to it. All transmission line pauperisms to form a shrivel during its production line life cycle. The two chief(prenominal) aspects of a contract are the cater and sufferance. The ships company that makes an stomach in a contract is called the suggestor and the party who accepts the base on balls make by the twistor is called the put forwardee. There are mevery terms and conditions declared in the contract which puzzle to be accept by some(prenominal) the parties to enter in to a legal binding contract. The provideor mustiness(prenominal) state his readiness to create a binding contract by accepting the terms to the stomachee. The spinee can render to form a binding contract an individual, group of people and to the national. Offers do to the public are considered as an invita tion to treat since it welcomes offers by many people inwardly a say measure in which the offers need to be made. But there is a significant difference among offer and invitation to treat. The response to an offer is usually toleration whereas in the slip of paper of invitation to treat, the response would be an offer. Invitation to treat is more as an invitation to make an offer by understanding the terms. Invitation to treat helps in get a variety of offers and therefore increasing the chance to accepting a better and a more profitable contract.In the causa memorise presumption, prospering Antiques had stick on an advertisement on Monday by mode of the internet which had stated For sale, three square-toed style beds, gorgeous, 5000 each, cash, get out brighten up any bed room This advertisement is an invitation to treat since it was made to the general public and a response to this invitation to treat would be considered as an offer. This relates to the baptistry of ruffed grouse v Crittenden 1968 An advertisement by Partridge appeared in the magazine henhouse and Aviary Birds, which contained the words quality British, bramble finch cocks, 25 shillings each. Partridge was charged with immoral offering for sale of a wild bird against s.6(1) of the Protection Birds arrange 1954 because this will form a unilateral contract since the offer to be in a legal binding contract has been indomitable by only one party. David, the manager of sportsmanlike Halls Ltd sends an email to grand Antiques immediately verbal expression that he is interested in dealing all three Victorian style beds at the appeal of 4500 each and enquires approximately any credit facility purchasable upon this barter for. This is an offer made by white-hot Halls Ltd to G gagaen Antiques. Therefore in the current situation, sporting Halls is the offeror and florid Antiques is the offeree. The offeree ( princely Antiques) must decide upon the offer made by lily-whit e Halls Ltd and can take any decisiveness since accepting or rejecting the offer is completely in their hands. The reaction made by dust coat Halls Ltd must be considered just as a request for data about the terms and new(prenominal) opinion obtainable in the contract. etiolated Halls ready non accepted the original terms and can non be considered to be a coming back offer. Therefore a request of information cannot follow up a binding contract. A similar case related to this would be the case of Stevnson, Jacques and Co V McLean 1880 Mclean wrote to Stevenson asking if he wanted to buy iron ore at 40S per ton in cash, and the offer was open money box Monday. Stevenson asked if the costlys were available on credit. They standard no answer. On Monday afternoon they contacted the defendant to accept the offer, but the iron had already been sold to someone else. The complainant won the case against McLeanprincely Antiques responded to the email direct by White Halls Ltd seeking information about the price and the credit facility be available. palmy antiques in response said the following We are not prepared to sell for less than 5000 each. Credit facility only available if your guarantor is acceptable to us. Please confirm by close of business today if interested.By stating this Golden antiques fork up made a antagonistic offer to their initial offer. This riposte offer states that the contract can be enforced only at the original price mentioned and their terms. They put on interpreted into servant about the credit facility and provoke stated that it is available only if White Halls Ltds guarantor is acceptable to them. They have alike mentioned that the espousal to the counter offer has to be conveyed by Tuesday. Stating the eon abut for the word sense, Golden antiques have made it very clear that the bridal to this offer will not be accepted after Tuesday and therefore be returnd properly. look for offer is an offer made against the previous offer by the antecedent offeree after taking into consideration the request of information by the offeror. This counter offer is usually the final offer made in the good interest of both the parties to form a legal binding contract. The counter offer nullifies the previous offer made by the offeree. No contract can be formed if this counter offer is not accepted by the offeror. A relevant case would be the case of Hyde V Wrench 1840 Wrench offered to sell his farm for 1,000 but Hyde declined. He offered 950 and and therefore Wrench refused to accept. Finally Hyde agreed to buy the farm at old price but Wrench refused, therefore a counter offer destroys the original offer. after(prenominal) providing a counter offer, Golden antiques will today be the offeror and White Halls Ltd will be the offeree. The counter offer will become a legal binding contract if White Halls Ltd accepts the counter offer made by Golden antiques. Golden Antiques have undertake that the offer is reasonable till Tuesday and any word meaning receive after this date will not be taken into consideration. This says that they need a response immediately through effective and fast convey of dialogue. The case related to this will be the case of Tin V Hoffman 18734 in this case the offeree was specified to reply by post, any regularity which to be more effective or faster than post was overly acceptable. In this case, the offeror had specified the mean of confabulation through which the borrowing had to be communicated. The court received that the offeree must accept this technique of communication or the next best alternative to communicate to the offeror. Relating this to the case study, Golden antiques have said that the espousal to the counter offer need to be made by earliest on the Tuesday which made it obvious that a reliable and fast communication was necessary. If this was not communicated properly or was hold up callable to a slower office of communica tion, the offer becomes invalid due to lapse of time.A contract come into existence only when the latest offer or counter offer is accepted. Acceptance conveys that two or more parties have agreed to all the terms and condition specified in the contract. The most important part of acceptance would be the pattern of communicating. This is important because acceptance is not effective if it is not communicated. The other important aspect of acceptance is that the parties must obey to the way of communication inflexible upon i.e. if the offeror has specified a means a communication through which the acceptance has to be communicated, it must be followed. This has to be communicated effectively and within the time mannequin in which the offer will be valid or it will be cancelled due to lapse of time. If invalidation is made to begin with the acceptance takes place, the offer will be cancelled.After receiving the counter offer made by Golden antiques, David autotypees the accep tance stating his willingness to purchase the three Victorian style beds at 5000 each. This acceptance letter also includes the letter from Black Halls Ltd, the guarantor for White Halls Ltd which states It is our policy to ensure that our subsidiary, White Halls Ltd remains solvent at all times. This letter of acceptance by the offeree was not transmitted properly and therefore was not received by Golden antiques. A case that relates to this situation will be the case of Felthouse V Bindley 18625 Felthouse tried file a case on the bag of breach of contract however Bindley had the case favoured to his side since it was stated that acceptance was not communicated thus a contract was never really formed.David posted his acceptance on the same day at 5pm even when he was aware of the fact that there was a postal strike on that day. David was intumesce aware that the letter of acceptance would not reach the offeror, Golden antiques at the right time. Therefore, David must have opted f or a better means of communication which would be reliable, effective and fast. The time frame being given in the counter offer renders the urgency and importance of communicating the acceptance as fast as possible. But posting the letter is considered as being received according to the postal run thereby take to forming a legal binding contract. Postal rule apply where the means of communicating the acceptance to the offer is post or telegram. Postal rule states that the acceptance is effective on the date and time at which the letter is posted and not when the letter of acceptance is received. The postal rule ignores the facts of the time taken to deliver the post and any other circumstances such(prenominal) as post being lost. The case that satisfies this will be case between Adams V Lindsell 18186 because to the wrong address the post by the Lindsell reached Adams by 5th of September. Adams replied back to Lindsell but the letter reached by eighth of October and the time lim it was till 7th of October. The defendants representd that the time limit specified had been passed and they didnt comprehend a reply hence the offer was already lapsed. However if Lindsell would have addressed the first letter correctly then the plaintiffs could have managed to reply back in time. However the plaintiffs won the case since the postal rule was being applied.On the other hand, there are many exceptions to the postal rule. The postal rule does not apply if the method to communicate the acceptance has been specified by the offeror. White Halls Ltd and Golden antiques had initially started communicating through e-mails and ways a very reliable and fast way to communicate among the parties. Golden antiques showing the urgency and the given time frame show that they were expecting a response from White Halls Ltd through e-mail or a fax. This can be seen when Golden antiques said Please confirm by close of business today if interested and can therefore be taken as an exc eption to the postal rule. The fax sent by White Halls Ltd was not clear and hence the acceptance was not communicated effectively. David from White Halls Ltd must have tried to send through a incompatible fax machine or might try another time. David must have e-mailed the acceptance letter to Golden antiques which was their initial way of communication. This could have been better than posting a letter of acceptance when he was ensure about the delay which will be caused due to the postal strike. Therefore, the postal is not applicable in the case of White Halls Ltd and Golden Antiques. A similar case would be Entores ltd V Miles far East raft 19557 In this case it shows that both the parties had instant communication method (that is telex machine in this case). Entores sued the M E C for breaching from the contract. The court stated that the negotiations were made by telex so instant communication was available. The defendants tired to argue with postal rule, however it was ru led that if acceptance was made on telex then the postal rule wont doesnt apply.Postal rule does not apply in the above detailed case and the acceptance was not communicated. There has been lapse of time and no contract was formed. Therefore the offeror, Golden Antiques is eligible to form a new contract with the third party and has no legal binding contract existing with the previous party.Roger an comptroller who has prepared the financial statements for Golden Antiques called up on Wednesday morning saying that he is interested in buying the Victorian style beds. In this situation, Roger is the offeror and Golden Antiques is the offeree. Roger has provided the service of preparing the financial statements are half the cost he usually charges. This is an example of historic consideration and a past consideration has no value in the future. There can be no consideration given for an activity performed in the past. Its the parties own will to charge for an activity to be performed and form a contract for which he will get a return from the other party which are agreed upon by the parties. A relevant case here would be the case of Re McArdle 19518 the agreement to pay the money was not enforceable as a contract as the work had been completed and the consideration was wholly passed. The offer made by Roger is valid since there has been no contract between Golden Antiques and White Halls Ltd.To accept this offer, Golden Antiques sends a letter of revocation of the offer on Wednesday to David of White Halls Ltd saying that the Victorian style beds are no long-acting for sale. A revocation is the expiration of an offer. Once a revocation has been communicated, the acceptance of an offer will be treat and is no longer possible. Revocation is an exception to the postal rule and is considered only when revocation is received by the other party. In a situation where offer and revocation was made on the same day, the decision will depend on whether the offer or the revocation was received first. This will be further explained by the case of Byrne Co V Leon Van Tienhoven 1880? Tienhoven tried to withdraw the offer, they posted the letter by 8th of October which was received by Byrne Co by the 20th of October. It was ruled that the offer couldnt be withdrawn since the acceptance was already into existence due to the postal rule. In this case the time gap between the revocation and offer being received is very small and is therefore harder to justness whether revocation is effective or not. Golden Antiques received the acceptance letter by post at 345pm on Thursday and the fax on revocation is received until 400pm. In my opinion revocation should be effective since the posting of the letter is not considered as a means to communicate acceptance in this case.Advise on the parties legal slopeThere are three parties in this case which are Golden Antiques, White Halls Ltd and Roger. The above detailed case shows that there is more evidence in th e favour of Golden Antiques than that of David. Golden Antiques have obeyed the terms of forming a contract and on the part of revocation. They have made it clear on the terms of the contract and also have given the time frame in which the other party must respond and give in their acceptance.The advertisement made by Golden Antiques is an invitation to treat. David the manager of White Halls Ltd makes an offer and negotiates the price of the Victorian style beds. But this is rejected by a counter offer made by Golden Antiques to David and specifies the time frame in which he must convey his acceptance. David tried to fax the acceptance letter but due to technical difficulties was unable to do so. He then posted the letter to convey the acceptance which he was well aware of not being able to make on time. This offer was not affective after Tuesday due to lapse of time. David must have used a better means to deliver the acceptance. He could have adopted the initial way of communicati on which was email.Revocation letter was then sent by Golden Antiques to David of White Halls Ltd stating that the beds are no longer available for sale. According to the postal rule, the revocation has to be received before the acceptance was received. But in this scenario, the postal rule should be ignored since posting a letter was not an acceptable form of communication in a situation with a short time frame. Therefore David will not be able to take any legal action against Golden Antiques. On the contrary, it will be considered as Davids duty period of not considering the terms of the contract.Legal advice to the partiesThe three parties involved in this case are Golden antiques, White Halls Ltd and Roger the accountant. From the given clear picture of the case above, it is quiet comprehensible that The Golden Antiques side of the case was more convince as compared to that of David. If the manager of white halls ltd, be likely to sue golden Antiques, they will not be accuse d for any claims. Golden antiques had made its companys intentions very clear from the very beginning, i.e. when they had first advertised their invitation to treat. David first makes an offer showing his interest towards the purchase of the Victorian style beds, which was immediately rejected by making a counter-offer by golden Antiques. In the offer it was very well stated that if acceptance not conveyed by Tuesday which in turn makes the postal rule irrelevant. When the acceptance sent by fax was not communicated due to transmission errors, David should have used some other means of communication which would have been equally fast and effective. As the acceptance was not communicated on time the offer has lapsed.Golden antiques then sent a letter stating the revocation of the offer as they had now clear-cut to sell the beds to Roger and are legally contracted with White Halls. Even though the Revocation of the offer was received or conveyed after the receipt of the acceptance le tter from David, this will be regarded as Davids fault for not complying with the terms of the offer. Therefore, it is not advisable to take any legal actions against Golden Antiques because the judge verdict will be on the favour of Golden Antiques. display panel OF CASESPartridge v crittenden 1968 1 WLR 1204,19682 ALL ER 421,(1968)112 SJ 582Stevenson,jacques Co v Mclean 1880) 5 QBD 346Hyde v Wrench (1840) 3 Beav 334Tin V Hoffman (1873)Felthouse v Bindley (1862) 11 CBNS 869Adams v Lindsell (1818)1 B Ald 681, 1818 106 ER 260Entores Ltd v Miles farther East Corporation 1955 2 QB 327,1955 3 WLR 48,1955 2 All ER 493, CAMcArdle,Re 1951 Ch 669,1951 1 All ER 905, (1951) 95 SJ 651, CAByrne Co v Van Tienhoven Co (1880) 5 CPD 344BIBLIOGRAPHY Ewan McIntyre, Business Law, 4th ed. Pearson Longman, 2008Catherine Elliot Frances Quinn, Contract Law, 7th edition, Pearson Longman, 209 Charles Wild Stuart Weinstein, Smith and Keenans Company Law, 14th edition, Pearson Longman, 2009