COMMON LAW

Common Law

Common Law

Explain the importance of the four key elements required for the formation of a valid contract and discuss whether a valid contract exists in this case. in your answer , also consider three different types of business agreements which exist to illustrate the four key elements of a contract.

The four elements of a valid contract are as follows: (Barnett 2003:36-59)

Parties Capable of Contracting: Anyone can enter into a contract, except minors, certain felons and people of unsound mind.

Consent of The Parties: A valid contract also requires the parties' consent, which must be free, mutual and communicated to each other.

A Lawful Object: The thing being agreed to is also known as the object or subject. It should be lawful, likely and definite.

Consideration: All agreements need consideration, significance each party should gain something. It may be certain thing that is or isn't finished or given.

Certain agreements aren't legitimate except in writing. Generally, they deal with genuine house, certain liabilities, cash exceeding a certain allowance, or things that won't be presented inside one year or inside the promisor's lifetime.

In this case these elements are not included, hence proving to be invalid contract. For example, there was no consent of the parties. Mrs. Readalot did not inform John that she went to get money and she is interested to buy the book. It was not communicated, hence there was no consent among the parties.

For this case, there are different types of business agreements existing. (Ewan 2005:12-20)

Unilateral - 1 person has obligation: it was only Mrs. Readalot who was under the obligation, however John was not aware of any agreement being held.

Simple - verbal or in writing: it was a verbal agreement, considering the case that Mrs. Readalot thought herself that there is an agreement.

Standard - business forms, invoices bills etc: the agreement could by standard because there would have been a bill given to Mrs. Readalot on the purchase of the book.

Apply the rules of offer and acceptance to the case study above. Consider the impact that new technology may have and what issues may be particularly relevant for john if he takes his business online offering his books for sale through website.

Offer and acceptance investigation is a customary approach in agreement regulation utilised to work out if an agreement lives between two parties. As a agreement is an agreement, an offer is an suggestion by one individual (the "offeror") to another (the "offeree") of the offeror's enthusiasm to go in into a agreement on certain periods without farther negotiations. The "mirror likeness rule" states that if you are to accept an offer, you should accept an offer precisely, without modifications; if you change the offer in any way, this is a counter-offer that murders the initial offer. As a direct of convenience, if the offer is accepted by mail, the agreement arrives into reality at the instant that the acceptance was posted. This direct only concerns when, impliedly or specifically, the parties have in contemplation mail as a means ...