COMMON LAW report 1 (law of contract)

In this report, the following issue will be discussed: • Different types of business agreement and the importance of key elements • Rules of offer and acceptance • The importance of contracting parties having appropriate legal capacity to enter into a binding agreement • Specific contract terms with reference to their importance and impact • The Law on standard form of contracts • The effect of exemption clauses in attempting to exclude contractual liability

Kim Thai Ha - Kim

Registration No.: ITP F02-50 (F02A)

December 2010

Executive Summary

My clients, Mr Robinson has come and is seeking advice on several claims and legalissues which have recently arisen Therefore, as being a legal executive of a solicitorsfirm, my responsibilities is to come up a legal report form for Mr Robinson

The report provides a general discussion on Mr Robinson problems The report is theanalysis and suggestion on several claim and legal issues is given, allowing Mr Robinson

to understand his legal position This report contains 4 claims arise from Mr Robinsonand 1 claim arises from Emily who is a 16 years old minor The five claims are as follow:

 Claim 1: The claim between Mr Robinson and Alvin and Nguyen

 Claim 2: The claim between Mr Robinson and the Carpenter, Douglas

 Claim 3: The claim of Emily as a minor with the London South Bank, supplier of equipments, dancing and singing teacher and mobile telephone company

 Claim 4: The claim between Robinson and Yen on the supply of mixed seafood

 Claim 5: The claim between Robinson and Sam who was injured in Mr

Robinson’s restaurant

In each claim, Robinson and Emily have been gotten different effect by different kind ofcontracts and rules, such as voidable contract, valid contract, unenforceable contract,Unfair Contract Terms, fundamental breach, etc

This report is the discussion on the law of contract Everyday, we enter into manycontracts with each other, therefore, understanding the law of contract is very important.The report will point out the seven essential elements of a valid contract, as well asspecific terms in a business contract In terms of the essential elements, it is important toprovide agreement, consideration and intention, capacity and form In business contract,the law of contract classifies the different terms in a contracts as well as exclusion clause

In this report, the following issue will be discussed:

 Different types of business agreement and the importance of key elements

 Rules of offer and acceptance

 The importance of contracting parties having appropriate legal capacity to enterinto a binding agreement

 Specific contract terms with reference to their importance and impact

 The Law on standard form of contracts

 The effect of exemption clauses in attempting to exclude contractual liability

Along with discussing on the theories, the report has also applied the theories, law ofcontract, and other rules to suggest and advice Mr Robinson on his legal position

All the resources of the report was selected carefully from the world wide web and the

course book BPP Professional Education However, because of the word limit, all the

case examples are recapitulated in the appendix

1a – Explain the different types of business agreement and the importance for the

key elements required for the formation for a valid contract

1a.1: Explain the different types of Business Agreement

1a.1.1 Definition of contract

As the book BPP Professional Education (2004,p.36), a contract may be defined as an

agreement which legally binds the parties A party to a contract is bound, because he has

agreed to be bound Parties are judged by what they have said, written and done, not what

is in their minds

1a.1.2 Formation of a contract for agreement

In any contract, the first requisite is an agreement which consist of an offer and

acceptance It must have one party makes an offer, when the other is offeree accepts (A

level law, nd)

1a.1.3 Different contract types of agreement

Bilateral contract is a promise made by one

party in exchange for the performance of some

act by the other party; both parties are bound

by their exchange of promises (Jrank, nd)

Howe Vs O'Mally (1893) (Appendix1a.1,p.20)

Unilateral contract is where a promise only

on one side, the consideration on the other side

having already been executed (Chestofbook,

nd)

Reif Vs Paige (1882) (Appendix 1a.2,p.20)

Express contract is in which both parties have Fibrosa Spolka Akcyjna v Fairbairn Lawson

explicitly stated the terms of their bargain,

either orally or in writing, at the time that the

contract was created (Doti chee, 2010)

Combe Barbour, Ltd., (1943) (Appendix1a.3,p.21)

Implied contract is resulted from

surrounding facts and circumstances that

suggest an agreement (Doti chee, 2010)

Hertzog v Hertzog (1857) (Appendix1a.4,p.21)

Promissory estoppel applies where there may

not otherwise be an enforceable contract,

because one party has relied on the promise of

the other, it would be unfair not to enforce the

agreement (US Legal, nd)

Salsbury v Northwestern Bell Telephone Co.,

(1997) (Appendix 1a.5,p.22)

Quasi contract is a binding obligation that is

imposed by the courts to avoid injustice or

unjust enrichment (US Legal, nd)

Cotnam v Wisdom (1907) (Appendix1a.6,p.22)

A simple contract is merely oral, or in

writing, not under seal, nor of record The

promisor must have obtained some advantage;

the promisee must have sustained some injury

or inconvenience in consequence of such

promise (Lectlaw, nd)

Shaughnessy v Eidsmo (1946) (Appendix1a.7,p.22)

A specialty contract is a formal contract, it

does not require any consideration and has the

seal of the signer attached A contract under

seal must be in writing or printed on paper (US

Legal, nd)

In re Estate of Michael 1966 (Appendix1a.8,p.23)

A standard-form contract is a preprinted

contract containing set clauses It is used by a

business or within a particular industry to make

slight additions or modifications in order to

meet the specific situation (US Legal, nd)

Woodburn v Northwestern Bell Telephone Co.(1979) (Appendix 1a.9,p.24)

Business agreements exist as the versatile

legal tool that allows strangers to do business

together by guaranteeing legal enforcement of

its terms (Ehow, nd) Example is employment

agreement and sale agreement Employment

agreement is an agreement between employee

and employeer It must contents work rules,

duration of employment, remuneration,

grounds for termination and job duties Sales

agreement is between merchants and

Employment agreement: Al-Othaim company(Appendix 1a.10,p.25)

Sales agreement: Nanjing International TradeCo., Ltd.  and Nanjing PV-Tech Co., Ltd.(Appendix 1a.11,p.26)

consumersi It should have detailed description

of the goods or services for sale; the total

payment due, along with the time and manner

of payment or warranty, guarantee information

for the goods or service (All business, nd)

There are nine different types of contracts bilateral vs unilateral; express vs implied;promissory estoppels; quasi; simple; specialty and standard form, and businessagreement

1a.2: Explain the importance for the key elements required for the formation for a valid contract

1a.2.1 The essential key elements

To have a valid and enforceable contract, it must contain 7 key elements, which are:

agreement, consideration, intention to create legal relations, legal capacity, form andcontent (Law teacher, nd)

1a.2.2 Effect when key elements are absent, and on affected parties

When a key elements missing, the contract will be invalid (BPP Professional Education,

2004,p.38) Case example: Felthouse v Bindley (1862) (Appendix 1a.12,p.28)

An invalid contract may be a void contract, a voidable contract or unenforceable contract

A void contract is not a contract, the parties are not bound Meanwhile, a voidable contract is a contract that one party may avoid, can terminate at his option; so the contract is valid unless and until it is avoided The last is unenforceable contract, it is a valid contract but incapable of being sued upon or proved (BPP, 2004,p.39)

In conclusion, without essential elements, the contract will become invalid contractwhich consists of three types: void contract, voidable contract and unenforceablecontract Each of these contracts makes difference effect to the parties involve

1b - You are required to analyze the scenario from the perspective of the law of contract Apply the rules of offer and acceptance in a given scenario also considering any impact of new technology

1b.1: The rules of offer and acceptance and the impact of new technology

1b.1.1 Agreement as an essential element of contract

Agreement is the first essential element to make a binding contract, without agreement the contract become invalid (Law teacher, nd) The formation of agreement is by offer

and acceptance, it can make orally or in writing, or implied by the conduct of the parties

An offer is a definite promise to be pound on specific term, while an acceptance is the unqualified agreement to the terms of the offer As an element of agreement, if one of the element missing, there is no agreement and no contract at all (BBP, 2004,p.41,42,49)

1b.1.2 Validity of agreement for online contract

With contract concluded in the Internet, the principles governing the formation of written or oral contracts also applied This has been confirmed by s.11 of the Electronic Transactions Act Cap88, the act also provides that “a proposal to conclude a contract

is to be considered as an invitation to treat” (Electronic Transactions Act Cap88, nd)

1b.1.3 Invitation to treat

Invitation to treat is an indication that someone is prepared to receive offers with the view to forming a binding contract, and it not an offer in itself Case example: Partridge

v Crittenden 1968 (Appendix 1b.1,p.29) In the case of Robinson’s website, his action

selling the antique book online was an invitation to treat However, Alvin made offer to Robinson, and the automated reply had accepted this offer Therefore, between Robinson and Alvin had agreement.

1b.2: Defense against Alvin

Since the transaction between Robinson and Alvin was a valid agreement Therefore, if Robinson failed to deliver the books to Alvin, he would breach the contract However,

as an antique seller, Alvin was aware the mistake of Robinson shop in the price (only

£88), which means he violated the contract by capitalizing on Robinson mistake.

The book price was changed due to an error of Robinson’s mistake; he did not know this

changing So according to the unilateral mistake rule, the contract is void and Robinson is not bound of this online contract The case example is Hartog v Colin &

Shields 1939 (Appendix 1b.2,p.29)

1b.3 Prevention of similar incident from happening again in the future

Robinson should not use the automated reply stating the transaction was successful to thebuyer Instead of that, the automated reply says Robinson is aware of the order; thetransaction is successful when the shop communicates back to the customer, to confirmthe contract (the quantity, the price) This step is the counter offer, helps the shopterminates the original offer Another way is terminating the automated reply, Robinsonwill email the customer, so Robinson could identify and fix the mistake

1b.4: Purchase of exceptional Han dynasty tomb potter horse antique

Robinson’s antiques were stolen He places a notice in an antique magazine, that paying

£2500 against a tomb pottery horse antique The notice is an offer because it is not vague, made to the world, and he also provide the exact amount award; therefore, it is a form of contract The case example: Carlill v Carbolic Smoke Ball Co 1893 (Appendix

1b.3,p.29) However, Nguyen asked Robinson that if he could accept the tomb pottery

camel or not Which means, this is a counter offer for the original offer (the horse antique), so Robinson has the right to reject or accept the offer according to the counter offer rule Case example: Hyde v Wrench 1840 (Appendix 1b.4,p.30).

1b.5 Revocation of offer

According to the revocation of the offer: the offer may be revoked by the offeror at any time until it is accepted However, the revocation of the offer must be communicated to the offeree (A level law, nd) Therefore, Robinson can withdraw his offer to enter into a

unilateral contract by placing another notice in the magazine about his revocation of theprevious offer; and this action must before acceptance of Nguyen or Gibson The caseexample is Dickinson v Dodds (1876) (Appendix 1b.5,p.30)

1c - Assess the importance of the rules of intention and consideration of the parties

to the agreement

1c.1 Explain the important of intention

Intention is of the essential element of a binding contract, which means it is so important for parties to create the willingness to be bound by the term of the contract.

The court apply commercial agreement are usually intended to be legally binding (BPP,2004,p.73)

1c.2 Explain the important of consideration and sufficiency of consideration

Consideration is important as an essential element of a binding contract It provides that the parties to a contract must each provide something More than that, consideration need not be adequate but it must be sufficient Sufficient consideration means that the consideration must be something more than the party involved was already intended to

do It must be deemed actually to be consideration (BPP, 2004,p.61,71)

In the case of Robinson and the carpenter Douglas, both of them have the intention andconsideration

1c.3 Douglas vs Robinson.

In this case, we can apply existing contractual duty which provide that if the performance of an existing contractual duty confers a practical benefit on the other party this can constitute valid consideration (A level law, nd) More than that, as a

commercial, agreements, both parties are usually intended to be legally binding (BPP,2004,p.73)

In order to avoid the penalty clause, Robinson promised to pay Douglas extra sum

Robinson had received the benefits from his promise, his work completed on time and he did not have to pay the penalty More than that, Robinson action was not under any duress or fraud Douglas’s performance of its existing contractual duty could amount

to sufficient consideration for Robinson’s promise of additional payment Hence, Robinson has to pay the extra money for Douglas The case example is Williams v

Roffey Bros and Nicholls Ltd (1990) (Appendix 1c.1, p.31)

1c.4 The extra sum money and reducing the contractual price

Douglas installed wooden decorative skirtings to the wall, which are not part of thecontract so Robinson provided his promise to pay extra sum This promise was said when

Douglas finished installing, therefore, it was past consideration According to past consideration rule, Robinson was not be bound by the promise Case example: Re McArdle 1951 (Appendix 1c.2,p.31) In addition, apply the unsupported fresh consideration rule: the contract between Robinson and Douglas was existing; Robinson was only person who made a further promise about paying the extra sum, this does not

arise new contract The case example is Roscorla v Thomas 1842 (Appendix 1c.3,p.31).

Consequently, Robinson would not have to pay the extra sum.

Furthermore, Robinson was seeking to reduce the original price from £50,000 down to

£40,000 while the contract was still performing Applying the Mirror Image rule, Robinson must follow the clause in the existing contract; he could not raise a new contract Case example: Montgomery v English (2005) (Appendix 1c.4,p.32) Thus, if Robinson paid £40,000, which means he had breach the contract and Douglas could sue

- Contract with bank for a loan

- Contract for singing and dancing lessons

- Contract with supplier for stage clothes and equipment and

- Contract for the mobile phone

1d.1: Explain the importance of contracting parties having the appropriate legal capacity

1d.1.1 Explain legal capacity

Capacity is one of the essential elements of a contract, it about some groups of people

whom unable to enter into binding contractual agreements (such as minor, insane person,intoxicated person, etc.) (BPP, 2004,p.76)

1d.1.2 Explain what would happen to a person who lacks legal capacity when he enters acontract

These people, they cannot understand the nature and consequence of the transaction(Robin Mashal, 2009) so if they enter into a contract, the contract will considered as

voidable This protects them from being forced to go through with a deal takes advantage

of their lack of knowledge (Richard Stim, nd) However, according to the Minors’Contracts Ace 1987, a contract between minor and other party may be valid contract,voidable contract, unenforceable (BPP, 2004,p.76):

1d.2: Explain using Olivia in the case, how legal capacity will affect contracting parties?

a The contract with the bank for loan:

The contract between Emily and the London South bank, it is binding on Emily unless

she repudiates it, so it is a voidable contract According to the rule of voidable contract, Emily must pay the money she received under the contract In addition, the money she

loan is used for her benefit (bought dance, stage clothing, equipment and pays for her

dancing and singing lesson) Therefore, she cannot get back the interest she had already

paid on the loan to the bank Case example: Steinberg v Scala (1923) (Appendix

1d.1,p.33) Furthermore, because Robinson is the guarantor, applying Section 2 of the Minor's 1987 Act rule, if Emily defaults on her debt, Robinson would be held liable for

the remainder of the loan

b Contract for singing and dancing lessons

Contracts of education is treated as contracts for necessaries, and bind the minor

(according to section 2 of Minor Contracts Act 1987) (Ardilaun Centre, 1985) Dancing and singing lesson, are considers as beneficial contracts of service education, as a result, this is a valid contract with Emily and she is bound Case example for agreement:

Clements v London & North Western Railway 1894 (Appendix 1d.2,p.33)

More than that, according to section 3, Sale of Goods Act 1979:“Where necessaries are

sold and delivered to a minor, he must pay a reasonable price” (The academist, nd)

Emily must pay for the teacher a reasonable price, which is the actually supplied price

of goods; the case example: Robert and Gray 1913 (Appendix 1d.3,p.33)

c Contract with supplier for stage clothes and equipment and

When the minor sets up in the business by his own, he will not be bound by this tradingcontract (The Law Reform Commission, nd) Applying to the case, the contract between

Emily and the supplier is unenforceable contract, so Emily will not be bound by this

trading contract and the supplier is bound The case example is Cowern v Nield 1912(Appendix 1d.4,p.33) However, whether the supplier could terminate supplies or not, it

depends on the terms of the contract If the term in the contract allows the supplier to

stop supplying, then the supplier can terminate the contract Otherwise, supplier cannotstop supplying if there no such agreement If he does so, he will breach the contract andEmily could sue for damage

d Contract for the mobile phone

With Emily, applying the rule of Sec.3 (3) Sales of Goods Act 1979, the mobile phone

is not a necessary item because it is required for use in a trade so is not necessaries.

Secondly, mobile phone is not the only way for her communicate Since mobile phone isnot a necessaries item, so the contract between Emily and the mobile phone company is

the unenforceable Case example: Nash v Inman (1908) (Appendix 1d.5,p.33) Hence, she can terminate the contract, and does not have to pay the mobile telephone account Nevertheless, under the Minor's Contacts Act 1987 s 3 (1); the court has power to make Emily return the mobile phone

2a - Analyse specific contract terms with reference to their importance and impact if these terms are broken

Robinson is a restaurant owner, he entered into a contract with Yen that Yen agreed tosupply Robinson with 1000 kg of mixed seafood at £25 a kg during the year 2009 ‘as andwhen required’ The agreement is: Robinson will not buy any mixed seafood from othersuppliers and Yen did not undertake quality of mixed seafood and no compensation if

mixed seafood is unsatisfactory However, after customer got poisoned, Robinson wanted

to discontinue supply after customers were poisoned, witch to Jonathan at lower price.Yen asked for preventing Robinson from buying elsewhere; and compensation on loss ofprofit for future supplies on the remaining quantity of up to 1,000 kg in year 2009

2a.1: Analyze the importance of terms in the contract

2a.1.1 Defines terms

The terms of a contract describe the duties and obligations that each party assumes under their agreement, it can be express or implied An express term is a clear

stipulation in the contract, which the parties intend should be binding upon them It is

divided into conditions and warranties Meanwhile, implied terms are stipulated by one

of the parties, requiring the other party to do certain things It may be implied by custom,the courts or by statute (Doti Chee, 2010)

2a.1.2 Importance of terms in the contract

When a term is against statutory regulation, it could make the contract become void More than that, the terms that legally unfair maybe is unenforceable.

If a party signs into a contract, he could be bound by the duties and obligations have been assumed under the agreement between each other Therefore, it is so important for

the contracting parties to understand the terms in the contract clearly before signing Thecase example is L'Estrange v F Graucob Ltd (1934) (Appendix 2a.1,p.34)

2a.2: The impact when terms are broken

When terms are broken, it could lead to many impacts to the parties involve The other

party can seek for remedies through legal action Furthermore, it may lead to lawsuits andill feeling between parties The other impact when terms are broken is that thetermination of relationship between parties and both may incur expenses for costly legaltussles (Btecexpert, 2008)

2a.3: The case between Robinson and Yen

As the fundamental term of providing food, that protect the health of customer, however,Yen supplied bad quality mixed sea food that make customer got poisoned This means, it

is the fundamental breach between Robinson and Yen, applying this rule, Robinson can terminate the contract with Yen Case example Photo Productions v Securicor Transport

1980 (Appendix 2a.2,p.35) Furthermore, the good quality of the food is the obvious

main purpose of the contract between Robinson and Yen However, Yen provide the

exemption clause that she did not undertake quality of mixed seafood and no

compensation if mixed seafood is unsatisfactory Therefore, these two exemption clauses are totally inconsistent and repugnant with the main purpose of the contract According

to the main purpose rule, the court can strike out these exemption clause The case

example Glynn v Margetson 1893 (Appendix 2a.3,p.35)

In the provision, sale and supply of goods (s 6-7), a consumer contract for the sale of

goods cannot be excluded or restrict liability for breach of the condition relating todescription, quality, fitness (BPP, 2004,p.103) Which means, according to the rule;

Yen’s exclusion clause about not undertaking quality of mixed; has been violated with the Act Applying the Section 11(2) refers to Schedule 2 to UCTA, which includes a number of issues that the court may consider when deciding whether a term is reasonable for the purposes of Sale and Supply of ss.6 and 7 (BPP Professional Education, 2004, p.103,104) The exclusion clause of Yen which is did not undertake quality of mixed seafood; and her injunction clause which is prevent Robinson buying mixed seafood anywhere; have been become unreasonable terms, therefore, Robinson is not bound by the contract Applying the rule of avoidance of liability for breach of contract (UCTA s3), when between Robinson and Yen has the fundamental breach which is the action supply bad quality food; Yen cannot restrict her liability for the

fundamental breach

In conclusion, Robinson has the right to terminate the contract with Yen, without compensation on loss of Yen’s profit Besides that, Robinson can make a new contract

with Jonathan

2b - Apply and analyse the law on standard form contracts

A standard-form contract is usually a preprinted contract containing set clauses (US Legal, nd) One type of this kind of contract is agreement of sale , which is a formal

contract for a seller agrees to sell and a buyer agrees to buy, under certain terms andconditions spelled out in writing in the document signed by both parties (Business

Dictionary, nd) Refer to appendix 2b.1, page 36 for the form of agreement of sale

between the seller and the buyer

This agreement of sale is the valid contract between the seller and the buyer Because

the buyer agreed to buy a horse from the seller, so it has offer and acceptance; or

agreement in this case In addition, the seller provides the horse and buyer provides money, which means it has consideration Besides that, as commercial agreements, both parties are usually intended to be legally binding (BPP, 2004,p.73) The main purpose of

this contract is that the buyer wants to buy a healthy horse

As a signed document, it provides “In witness whereof the Parties, intending to be

legally bound, hereby have set their hand and seal on the day above written”; so after

signing the document both parties are bound They must perform the terms and

conditions stated in the contract

In this contract, the expressed terms have been stated Expressed terms are divided into two categories conditions and warranties In this horse selling contract, the condition terms are horse detail, the veterinary examination, payment details and health warranty.

The health warranty a condition term because it is important to the purpose of thecontract, and it states that the horse has no unsoundness or health problems on date ofsales

Mean while, the warranty term is “Buyer waives any claim for damage should said

equine fail to meet the above warranties at the time of delivery, unless such a defect is

discovered within (X) days from delivery to buyer” There are two possibilities, if (x) days is a short, for example 1 day, the buyer cannot find out any defect of the horse just

in 1 day, so it is unfair or unreasonable term If (x) days is long, like a month, the buyer

is able to aware the horse’s defect, so they can claim for the damage Then, it is become

reasonable term.

In addition, the contract also has exemption clause, which is: “the seller makes no

promises, express or implied, including the warranties of fitness for a particular purposeunless provided in this agreement” According to Sale and supply of goods in UnfairContract Term Act 1977 (s 6,7), the exemption clause cannot exclude liability for fitness

(BPP, 2004,p.103) Which means, this exemption clause is unreasonable.

In term of implied terms, according to the Sales of Goods Act 1979, the seller have the

right to sell the horse; the horse has to correspond to the description in the contract andthe horse should be of satisfactory quality, which means suitable for regular training.More than that, after both parties sign in the contract, they have to follow the condition aswell as the warranty terms Failure to do so, the party has the right to sue for

compensation and damages For example, if the seller provides unhealthy horse for the

buyer, the buyer can sue for the compensation and damages

In my opinion, in general, this agreement for sale has reasonable terms, except theexemption clause that the seller does not make for the warranties of fitness of the horse.This contract is a valid contract

2c - Discuss the effect of exemption clauses in attempting to exclude contractual liability

The customer, Sam, was injured after chair collapsed in Robinson’s restaurant However,Robinson denied his liability by use of exemption clause displayed in the premises andreceipt

2c.1: Effect of exemption clauses

Exemption clause is a clause which seeks to release one of the parties from liability should something go wrong with the contract The law seeks to protect the individual from unfair exclusion clauses (BPP, 2004,p.96) More than that, the exclusion clauses will be looked the court if they follow the statute, not ambiguous or are reasonable.

When the terms are ambiguous, the court may interpret any ambiguity against the person

at fault who relies on the exclusion Furthermore, the court will see the term is reasonable

or the content has been reasonably brought to the attention of the customer (Btecexpert,2008)

2c.2: Advise Robinson about his legal position for issues with Sam

2c.2.1 Prior information on terms

The prior information on terms provide that since the term of the contract are fixed at the moment of acceptance of the offer, an exclusion clause cannot be introduced thereafter (BPP, 2004,p.98) The case example is Olley v Marlborough Court 1949

(Appendix 2c.1,p.39) About Robinson’ case, when Sam entered into Robinson’srestaurant, paid for the meal, the contract between them has arisen The noticeprominently displayed in the foyer of the dining area that also the exclusion clause of

restaurant had been provided after the contract arose Consequently, Robinson cannot rely on this notice as an exclusion clause.

2c.2.2 Unsigned documents

An unsigned document may contain the exclusion clause, so a reasonable and sufficient

notice of the existence of the exclusion clause should be given To fulfill the requirement,

the existence of the exclusion clause must be brought to the notice of the other party before or at the time the contract was formed (Lawtecher, nd) Case example is Olley v.

Marlborough Court 1949 (Appendix 2c.1,p.39) The notice in Robinson restaurant had

been brought after the contract is entered into More than that, the clause must be contained in a contractual document, not as a receipt (Lawtecher, nd) The case example

is Chapelton v Barry 1940 (Appendix 2c.2,p.39) Which means Robinson’s exclusion

clause on the back of receipt is insufficient.

Furthermore, according to Section 2(1) exemption for liability for negligence of the Unfair Contract Terms Act 1977, Robinson cannot exclude is liability in negligence for

personal injury, and in this case is restaurant’s customer – Sam

2c.2.3 Conclusion

In conclusion, the exclusion clause of Robinson in the notice as well as the receipt isinsufficient; he also has to take responsibility for Sam personal injure So Sam is likelysuccessful in this claim

Conclusion

It is necessary for a contract to have the seven essential elements; this allows the contract

to become valid and enforceable by the law There are nine different types of contractsbilateral vs unilateral; express vs implied; promissory estoppels; quasi; simple; specialtyand standard form, and 2 types of business agreement

In order for Mr Robinson and Emily could clearly understand their legal position in theclaims, the report has applied the rules of offer and acceptance, intention andconsideration, appropriate legal capacity to enter in a binding agreement, and the effects

of terms and exclusion clause to give out suggestion and advices

In claim 1, Mr Robinson needs to understand the rules of offer and acceptance.According to the Electronic Transaction Act Cap88, automated replied is a validacceptance; therefore, Mr Robinson needs to understand this to avoid any mistakes Towards the claim 2, Robinson will be required to pay an extra £425 per flat for Douglas.However with the promise of paying an extra sum of for wooden decorative skirtings,

Mr Robinson is not required to do so since it was a past consideration

In claim 3, Emily who is a 16 years old minor, therefore, the validity of contract sheentered into is controlled and assess by the Minor Contract Act According to the Act, thecontract between Emily and the South London bank is voidable, contract between Emilyand Supplier, and between Telephone company is unenforceable, a valid contract is thecontract between Emily and the Dancing and Singing teacher

In claim 4, Yen provide unfair and unreasonable terms in the contract; therefore, Mr.Robinson can terminates the contract and enter into new contract with Jonathan

Finally, in claim 5, Robinson cannot exclude his liability for the personal injury of hiscustomer Furthermore, his notice was unreasonable since it has been introduced after the

contract was form and place on a non contractual document Therefore, Mr Robinson isresponsible for Sam’s injury and must paid compensation.

Appendix 1a

1a 1 Howe Vs O'Mally (1893)

Fact: Howe, by a warranty deed, conveyed to O'Mally 140 acres of land This 140 acres

was a part of a much larger tract which was owned by Howe Two years later, by anotherdeed, Howe conveyed the remainder of the tract The deed recited that the remainingportion of the tract contained about 221 acres But it was stated in the conveyance that theintent of the owner was to pass title to the remainder whether it contained more or lessthan 221 acres Sometime later a dispute arose between the parties as to the number ofacres contained in the last tract conveyed O'Mally contended that it contained more than

221 acres To settle the disagreement they mutually agreed to have the land surveyed; and

if it should be found to contain more than 221 acres, O'Mally agreed to pay Howe tendollars an acre for the excess; and if it was found to contain less than 221 acres, Howeagreed to pay O'Mally ten dollars per acre for the deficiency Upon the resurvey, the tract

in question was found to contain 87 more acres than the deed called for Howe demanded

$870 of O'Mally; the latter refused to pay it and this action was brought for the recoverythereof

It was contended by O'Mally that no recovery should be permitted because there was noconsideration for his promise to pay ten dollars an acre for the excess

Held: Here are mutual promises; one is made the consideration of the other, and we are

of opinion, that the plaintiff's promise to refund in the event of deficiency in the number

of acres is a good consideration to support O'Mally's promise to pay should there be morethan the number of acres named in his deed

This was a bilateral contract Each had promised to do a certain thing under certaincircumstances Each was bound to the other and there was an obligation on the part ofeach

Therefore, it was decided that Howe might recover the amount sued for

1a.2 Reif Vs Paige (1882)

Fact: A certain building was burning On the fourth floor of the building was the wife of

the defendant, Paige The fire had made such progress that it seemed scarcely possiblethat she could be rescued Paige said that he would give $5,000 to any person who wouldbring the body of his wife from the burning building, whether dead or alive Reif heardthe offer He entered the building and, after a desperate struggle, located the body andbrought it forth

Thereafter he demanded the $5,000 of Paige, who refused to pay it Thereupon Reifbrought this action to recover the money in question The defendant contended that hewas not bound by this because there was no consideration for his promise to pay the

$5,000

Held: The offer of Paige in this case was a promise to any one who was willing to risk

his life in the burning building in an attempt to rescue the body of the woman Until theact of rescue was done the offer continued a mere promise, not binding upon Paige Assoon as Reif did rescue the body, however, his promise to pay the money became abinding promise

This was, therefore, a unilateral contract In accordance with the offer, by an act, Reif hadperformed or done all that he was required to do; but the promise of Paige still continuesbinding upon him, as yet unperformed

Accordingly, it was held that the plaintiff, Reif might recover of the defendant, Paige, the

Held: The subsequent impossibility of performance by the defendant sufficient to release

the parties from further contractual liability, as well as entitle the plaintiff to recover anydown payment, even though the defendant had already gone to some expenditure tomake the machines

1a.4 Hertzog v Hertzog (1857)

Facts: π (plaintiff) is the son of ∆ (defendant) π and his wife lived and worked for

several years on ∆'s farm, without pay, and upon ∆'s death, π sued ∆'s estate, under claim

of express contract, for back wages of his labor, his wife's labor, and for $500 loaned to ∆

at the time the farm was purchased Testimony was given to indicate that ∆ had madecomments to the effect that he planned to eventually pay π for his work, but he neverseemed to get around to it Trial court found for π and awarded $2200 ∆ appealed onground of error of the court

Held: The court stated that it was not proven that the father ever expressly contracted

with the son, in a hired servant relationship, because their relationship could be explained

by simple father-son filial relationship

1a.5 Salsbury v Northwestern Bell Telephone Co.,(1997)

Facts: Northwestern (D) gave a letter to Charles City College (P) promising a donation

of $15,000 A pledge card was completed to represent the donation and it was treated as anormal pledge card The pledge card was never signed by Northwestern Charles CityCollege assigned the pledge to a supplier of the college and gave the supplier theunsigned pledge card to reflect D’s donation

The college was later closed and Salsbury, the chairman of the board of trustees for thecollege, sued D to recover the pledged amount The court held that the pledge to P wasenforceable as a matter of public policy D appealed and asserted that the pledge was notenforceable because there had been no consideration

Held: A pledge to a charity can be enforceable without consideration.

1a.6 Cotnam v Wisdom (1907)

Facts: A man was thrown from his car and he was unconscious A spectator asked

doctors to help him, and they performed a difficult operation in an attempt to save hislife They were unsuccessful and he never regained consciousness The doctor Wisdomsued for the money it cost to perform the operation and they won at the trial court level.Cotnam appeals

Held: The court says that the doctor can recover under a well accepted legal fiction of

implied contract (aka quasi contract) In Sceva v True, the court stated: “…an insaneperson, an idiot, or a person utterly bereft of all sense and reason by the sudden stroke of

an accident or disease may be held liable, in assumpsit’s, for necessaries furnished to him

in good faith while in that unfortunate and helpless condition.”

1a.7 Shaughnessy v Eidsmo (1946)

Facts: Plaintiffs, husband and wife, by oral agreement leased from the defendant a

dwelling house and lot for a term of one year at a rental of 47.50 per month, and inconsideration , defendant agreed to give and gave plaintiffs an option to purchase saidproperty at the expiration of the lease term at a price between 4,750 and 5,000 on acontract for deed, subject to the proviso that plaintiffs should be allowed as a credit onthe purchase price the total rent paid for the lease term with the balance of the purchaseprice to be paid in monthly installments of 32.50, inclusive of unpaid taxes and fivepercent interest per annum on the unpaid balance Defendant also agreed to sell plaintiffs

a stove for 119.50, payable in installments of 4 dollars per month without interest.Plaintiffs entered into possession May 1st, 1943, and continued in possession throughoutthe one-year lease term ending April 30th, 1944, and paid said term a total rent of 570and a total of 48 on the purchase price of the stove At and before the expiration of saidlease term , plaintiffs notified defendant that they wished to exercise their option ofpurchase according to the terms thereof, and on several occasions they demanded thedefendant that he deliver a contract for deed as agreed On each of these occasions,defendant told plaintiffs that he did not have time to have a contract drawn, but that hisword was good and they should not worry Plaintiffs fully performed their part of theoption agreement and at all times have been ready, willing, and able to execute a contractfor deed Since the expiration of the lease term, plaintiffs have continued in possession,and from May 1st, 1944- May1st, 1945, have paid an additional 570 on the purchase ofsaid property and a further sum on the purchase of the stove When the option and leaseagreement were made, the premises were subject to a 4,200 mortgage which no mentionwas made to the plaintiffs and in regard to which no agreement was made that plaintiffsshould assume said mortgagee or take the property subject to the same

Held: The court reasoned that for the purposes of courts of equity, cases are taken out of

the purview of the statute in either of two ways: by fraud or by part performance Wilstonsaid that courts of equity early adopted the doctrine that such acts as the taking ofpossession, making improvements, and the like by the purchaser with consent of thevendor make the contract enforceable though there is no written memorandum In thispresent case, the elements of possession and part payment are present After plaintiffsexercised their option and an oral contract of purchase and sale then came into being,defendant’s conduct and statements were consistent only with a mutual understandingthat plaintiff’s possession of the premises aw no longer thank of a tenant but that of avendee with unequivocal reference to the oral contract Furthermore, when plaintiffs onseveral occasions, requested the preparation of a contract for deed, defendants, instead ofrejecting the vendor vendee relationship, affirmed by its stating “that he did not have time

to have a contract drawn; that his word was good; that plaintiff was not to worry aboutgetting his contract”