LAW - LEGAL ISSUES

Law - Legal Issues



Law - Legal Issues

First is the existence of a valid contract, a term or the terms have been breached. To determine the existence of valid contract, the essential elements should arise. The essential elements of a contract are: 1) existence of an agreement that arises when one party makes and offer, the terms of which are completely or substantially accepted by the other party to give rise to a 'meeting of the minds'; 2) presence of consideration, which pertains to the mutual promises given by the parties relative to the agreement; 3) intention to engage in legal relations, with the terms of the contract and the fulfillment of the obligations intended towards legal consequences; 4) form such as oral or in writing depending upon the object of the contract; 5) capacity of the parties to engage in a contract such as rightful ownership of the thing being appropriated or age; 6) provision of consent, which means that the parties to the contract engaged in the agreement freely; and 7) legality of the agreement so that there cannot be a valid contract for the commission of a crime or other objects deemed unconscionable or against public policy. The lack of one or more of these elements has the effect of rendering the contract as unenforceable, voidable or void; with each having their respective to the validity and continuity of the contract (Anderson, 2010,, P 43).

From the facts of the case, a valid contract was created when David agreed to the offer of Evelyn after months of negotiation and despite the refusal of Evelyn to show David the books of account of the company to create a 'meeting of the minds'. Without any proof to the contrary, David appears to have engaged in the contract on his own free will and offered his consent freely. It appears that the parties also had the capacity to engage in the contract, the form was in order, and the sale of the company is for a legal purpose (Beale, 2002,, P 118).

Based on the facts of the case, after the contract has been formed between David and Evelyn with David accepting the terms of Evelyn, there was no breach of the terms of the contract since even if Evelyn stated that the company is earning $2 million per annum, there was no indication that the company to be transferred should be earning $2 million for the past five years. The terms which are apparent only cover the transfer of ownership of the company and the purchase price that were delivered by Evelyn as fulfillment of his obligation to in the contract. Since there no apparent breach of contract appears in the facts of the case, David cannot claim breach of contract even if he discovered later on that the company was really earning less than what Evelyn previously stated.

Based on the facts of the case, David has no remedy against Evelyn for breach of ...