LAW CONTRACT

Law Contract

Law Contract

Question 1

There was a contract between them. Consideration is essential to a contract. Consideration is “a benefit to one party or a detriment to the other.” It is essentially an exchange of promises. Firstly the offer Imelda made to Holmes lacks consideration where Imelda offers Holmes a car but does not receive anything in return, this is said to be a naked or gratuitous promise and a legally binding contract cannot result from this. Also consideration must not be past. As the case, Bradley & Ewing (2003) which is similar in that Imelda is promising Holmes her old car for work he did in the past so again there would be no legally binding contract formed.

In summary it is clear that no legally binding contract exists between Imelda and Holmes, there was an offer made, we assumed intention to create legal relations but there was neither acceptance of the offer nor consideration. Therefore Imelda is well within her rights to revoke her offer and Holmes would have no rights to bring a claim against Imelda for breech of contract as no contract ever existed.

Secondly we will examine the connection and contractual claims between Holmes and Moriarty. Again we need to define the four essential element of contract to say a legally binding contract exists.

In this case Holmes's advertisement constitutes an invitation to treat rather than an offer to which Moriarty responds and subsequently buys the car for £550. Therefore offer and acceptance has taken place. Consideration has also taken place in that both parties have gained materially, Moriarty has gained the car and Holmes has gained the money paid for the car. This type of agreement would be seen as a business one and therefore it would be assumed the parties would intend to be legally bound. Again this assumption can be contested with evidence to the contrary. From this we can say that a legally binding contract exists between Holmes and Moriarty.

A day after buying the car Moriarty finds out from a mechanic that the car had been involved in an accident, when in fact he had been told by Holmes that it had never been involved in an accident, and as a result the car was worth £300 instead of the £550 Moriarty had paid. We would need to look at the effect this statement would have on the contract.

If Moriarty was to claim for ...