Aspects of Contract and Negligence for business



Aspects of Contract and Negligence for business

Introduction

A valid contract is a kind of an agreement which is marked by both the parties and meets all the prerequisites of state law and in this manner comes into force (Dietz, 2007). The Modern theory of contract states that a valid or legal agreement will exist just between two or more than two parties, if there is a sensible individual to judge that there is an offer made and it is acknowledged. It appropriates the subjective thought of the aim of the parties backed under the previous subjective theory of contract as too misty (Minette, 2009).

Discussion

The contract law and the law of negligence assume a vital part in the transactions held by the organizations. The reasonable comprehension and the exhaustive comprehension of the legal phrasings and thoughts supports the organizations to consent to the legal regulations and consequently, to evade any unnecessary litigation costs that organizations may need to manage because of non-compliance or not performing the activities according to due lead or strategy.

A contract is an agreement that is legally enforceable. A valid contract is a contract that conforms to the fundamental components sketched out for a contract in the contract law i.e.

Acceptance

Consideration

Offer

Intention

Thorough understanding of factors affecting the essential elements of a contract helps in bringing about contracts in a better way. It is highly essential to understand the components of a valid contract as all of these components are of sheer importance, and requires a keen study. Below is a brief description, regarding all these components in order to provide a better understanding of each of them.

An offer is a tentative promise that is subject to a specific condition, made by the offeror and does not binds the offeree until a valid acceptance comes into an effect. Acceptance is the second most essential component of a valid contract. Acceptance means, according to the contract law, when the counterparty in the contract to whom the offer is made accepts the terms and conditions. The third essential component for a contract to be valid is consideration i.e. a valuable thing in the view of law and something that is received by the promisee as promised by the promisor. The element intention means that for a valid contract, the promisor shall intend to fulfil and bound to do as per the promise made.

Capacity is the capability at law to bind the individuals/parties to the contract. The individuals that cannot enter into a valid agreement are insane, drunken, corporations, labour unions, bankrupt individuals and minors.

There are four types or ways through which a valid contract can come into an effect which is made either by the individuals or the businesses. The four types of the contract are described below:

Written

Oral/Verbal

Contracts by deed

On-line

Mostly contracts are written i.e. those contracts that are explicitly expressed in terms of black and white. The verbal contracts are the contracts that are not written on the legal ...