Business Law Sample Assignment 3x1x2w

PART A Question One i.

Identification of the legal issue

The legal issue is the element of agreement required for the formation of a legally enforceable contract. Explanations of the relevant principles of law (with reference to cases/legislation) The courts presume that when a condition is fulfilled, a legally binding agreement is created. Whether or not it hinges on an event happening does not matter. In the case of Masters v Cameron [1954] 91 CLR 353, Cameron agreed to sell her farm off to Masters for an amount of £17,500. Both parties signed an agreement, in which a stipulation stated that a formal contract would be drawn up later. With respects to the issue of whether or not there was a contract created upon agreement between the two parties, the court held that there had not been. When it is an issue of electronic communication, the courts refer to legislation. According to the Electronic Transitions Act 2000 Section 13 A sub-section 1 a, “the time of receipt of the electronic communication is the time when the electronic communication becomes capable of being retrieved by the addressee at an electronic address designated by the addressee”. Section 2 then goes on to state that “…it is to be assumed that the electronic communication is capable of being retrieved by the addressee when it reaches the addressee‟s electronic address”. Taking these two facts into mind, the courts will presume that any fault on behalf of the receiver which leads him or her to not check their electronic communication in time does not affect any contract being communicated electronically at the time. The courts will presume that any communication via post in order to accept an offer translates into acceptance as soon as the post of acceptance leaves the offeree. In the case of Henthorn v Fraser [1892] 2 Ch 27, Fraser offered to sell houses to Henthorn for a sum of £750. Henthorn had 14 days to accept the offer, and posted a letter to Fraser accepting it. Prior to Fraser receiving the letter, he decided to entertain a higher purchase offer by another buyer. In the issue of whether Henthorn had accepted the offer before Fraser‟s attempt to withdraw it and entertain the other buyer, the courts decided that acceptance of the offer occurred as soon as the acceptance letter from Henthorn was sent via the post.

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ii.

Application of the law to the facts

As a contract is only formed when there is a clear agreement of the express and condition, an objective assessment of the acceptance and the specific must be made. The question is whether, given the circumstances, a reasonable person would regard the contract between Constructs Pty Ltd (hereafter referred to as „Constructs‟) and the Minister of Education (hereafter referred to as „the Minister‟) as legally binding. In the Minister‟s email to Nicholas from Constructs, there was no future contract formation stipulation or anything of the sort. In fact, the email itself was an offer that could be accepted by Constructs straight away, which is what occurred. The fact that the Minister was incapable of receiving the facsimile due to a lack of paper does hold in her favour, if legislation is to be followed. However, the assumption that the Minister was capable of receiving electronic communication when she was the party who suggested it in the first place is a point against her case; Constructs could not have known that the Minister would encounter such an obstacle. Finally, Nicholas from Constructs ensured that he sent an acceptance letter “by post” as well. The fact that the Minister did not receive this letter by post on time does not hold in her favour. Nicholas had already conveyed his acceptance as soon as he posted the letter. iii.

Possible Conclusions

In conclusion, it is likely that the courts will find there was indeed a legally enforceable contract between Constructs Pty Ltd and the Minister of Education. The Minister will not be able to hold in court that there was a contract as acceptance had occurred despite her not knowing. PART B Question Two i.

Identification of the legal issue

The legal issue is the express contents of the contract, based on the correspondence that has taken place between Nicholas Rogers of Constructs Pty Ltd (hereafter referred to as „Constructs‟) and the Minister for Education (hereafter referred to as „the Minister‟) thus far.

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ii.

Explanations of the relevant principles of law (with reference to cases/legislation)

Before a contract can come into existence, must be negotiated, some of which are those without which a party / the parties would not have agreed to enter into an agreement, and others which are of lesser importance (Lambiris 2011). In this case, both the former (conditions) and the latter (warranties) must be discussed. The court presumes that for there to be an element of agreement between two parties, the essential (conditions) of the contract must be agreed upon (Lambiris 2011). In the case of Associated Newspapers Ltd v Bancks [1951] 83 CLR 322, cartoonist Bancks agreed to have his drawings published on the front page of the newspaper‟s comic section in exchange for a salary. Bancks‟ drawings, however, appeared on the third page instead, due to production problems. When addressing the issue of whether or not publishing on the front page was an essential term i.e. a condition, the court found that it was indeed, and hence Bancks was justified in terminating his performance. Moreover, the court presumes that the breach of a warranty (a non-essential term) does not entitle termination of performance by the breaching party. In Bettini v Gye [1876] 1 QBD 183, singer Bettini was contracted to promoter Gye for various events running between 15 weeks. One of the of the contract was that Bettini arrive six days before the first performance to rehearse, a term she failed to live up to due to being ill and missing four days. When addressing the issue of whether the term requiring attendance for rehearsals was a warranty or a condition, the court found that it was a warranty, a breach of which would not cause the contract to be terminated. The court further presumes that, if a party makes a statement to the other party to encourage entering into an agreement, then the circumstances in which the statement is made must be considered prior to establishing whether or not the statement is an actual condition or merely a „representation‟ (which, if proved untrue, does not affect the contract) (Lambiris 2011). In Oscar Chess Ltd v Williams [1957] 1 ALL ER 325, Williams‟ mother owned a second hand car which Williams took to a used car dealer to trade in. Although documents given to Williams by his mother outlined the car to be a 1948 model, it turned out to be a 1939 model instead. Regarding the issue of whether or not the statement in the car‟s documents was a term of the contract, the court found that the age of the car was in fact mere representation rather than a contractually binding promise.|

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iii.

Application of the law to the facts

As an agreement is only valid if there is acceptance of the conditions of the contract by the two parties involved, an objective assessment of the offered and what was accepted must take place. The question is what kind of in the assumed agreement between Constructs and the Minister can be identified by a reasonable person to be conditions. In her email to Nicholas Rogers, the Minister Hon. Joanne Lim MLA expressly states the cash amount she is ready to offer in exchange for the construction work for a new high school in Perth amounts to $20 million. It is further stated that work must commence „this month‟ and end „no later than, 2 January 2014‟. The amount offered can be considered to be a „condition‟ as it is an expressly stated consideration in exchange for the construction work by Nicholas‟ company. Moreover, the term involving the dates between which work must occur are also deemed conditions, as they come with explanations as to why this term is essential to the offerer; “[the] department of Education teaching staff will commence work on 3 January 2014”. The statement given by the Minister of Education also contains a request regarding the use of local materials to produce as being “in the interest of the state”. This can be considered to be a warranty as it is made clear this is an optional undertaking for Constructs. There is no requirement for this term to be fulfilled, and failure to do so will not terminate the contract between Constructs and the Minister. The term of accepting the offer via a reply on facsimile or in the post is what the Minister concludes her email by discussing. These can be considered to be conditions because it is here that the offerer is granting the offeree the chance to accept. Upon Nicholas‟ acceptance, a legally enforceable contract comes into practice. iv.

Possible Conclusions

There is indeed an enforceable legally binding contract between Nicholas Rogers and Hon. Joanne Lim MLA, with conditions already offered and accepted and an executed condition paving the way for a contract. .

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Reference List Associated

Newspapers Ltd v Bancks [1951] 83 CLR 322

Bettini

v Gye [1876] 1 QBD 183

Electronic

Transactions Act 2000 (Cth)

Henthorn

v Fraser [1892] 2 Ch 27

Lambiris,

Michael. 2011. First Principles of Business Law: Interactive Tutorials and Source Book. Sydney: CCH Australia

Masters

v Cameron [1954] 91 CLR 353

Oscar Chess Ltd

v Williams [1957] 1 ALL ER 325

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