CONTRACT LAW

Contract Law



Contract Law

Introduction

Contract is a set of pledges or affirmation enforced by regulation. It is based upon the affirmation of the parties. To come to an agreement between parties, it is significant for the two parties to have a common aim and consideration for both. However, intention is a subjective understanding of the party's minds whereas the parties can have different intention. In cases where the issue is litigated, it seems likely that one party intended when contradiction between parties occurs, it is forced to the conclusion that the courts must rely on hidden policy considerations when determining the intentions of the parties. It is important to look at how the law determines the intentions to create legal relation of the two parties which is policy consideration.( John, 2004 25)

Formation of contract

There are 4 components in contract, which are offer, acceptance, concern and aim to create lawful relation.

significance of conceiving legal relation

To make a contract to be lawfully enforceable, it is crucial to create lawful relation. The aim is to defend both parties by lawful means when the agreement is breached. The aim of the parties must be ascertained from the language they have used in the contract, considered the surrounding circumstances and the object of the contract.( Kim, 1997 134)

Importance of consideration

The delineation of concern by Pollock in his work on agreement is:

'An proceed or forbearance of one party, or the promise thereof, is the cost for which the pledge of the other is acquired, and the pledge therefore granted for value is enforceable'. To my understanding, consideration is based on bargains for both parties which mean the promisee must give something to the promisor in exchange for his promise. The conclusion in Australian Woollen Mills Pty Ltd v. Commonwealth shows that the promisor should propose to ...