Legal Questions, Case Studies, And Essay.

1. Understanding the essential characteristics of the formation of a contract in regard to a problem situation.
2. Identifying and accessing primary legal sources, appreciate the extent of their importance and the significance of keeping up to date with change and potential changes.
3. Identify relevant legal principles and court structure.
4. Understand the essential tests to determine the status of an employee.

1.Where a person introduces a term to a contract that excludes liability for death and personal injury then the term is:

(a)Void

(b)Reasonable

(c)Fair

(d)Non of the above

2.As of 1 October 2015 the Unfair Contract Terms Act 1977 and the Unfair Terms in Consumer Contracting Regulations 1999 no longer deals with consumers, but which Act replaced it.

(a)Unfair Terms Regulations 2016

(b)Consumer Rights Act 2015

(c)Exclusion and Exemption Clauses Act 2016

(d)Non of the above

3.Which of the following is correct:

(a)A condition is a minor term of a contract

(b)A condition is not a term of a contract.

(c)A condition is a major term of a contract

(d)Non of the above

4.Which Act governs frustration:

(a)The Frustrated Act 2000

(b)The Contracts Reform Act 1995

(c)The Law Reform (Frustrated Contracts) Act 1943

(d)None of the above.

5.Which of these sentences best explains misrepresentation

(a)A false statement

(b)A false statement of fact that induces a party into a contract.

(c)A accurate statement of fact that induces a party into a contract

(d)None of the above.

Look at Workshop 2 in your materials pack. Read the case study of O'Brien v MGN Ltd [2001] EWCA Civ 1279, and answer these questions:

1.What does LJ stand for in Hale LJ?

2.How many judges normally sit to hear a case in the Court of Appeal?

3.What was the name of the judge who first heard the claim?

4.Explain what the two citation stand fore in Interfoto Picture Library Ltd v Stiletto Visual Programmes Ltd [1989] 1 QB 433, [1998] 1 All ER 348

5.Which party won and which party did the courts say that they had sympathy with?

Draw a diagram of the court system in England and Wales.

Briefly explain the following cases:

1.Crystal Palace Football Club v Walker [1910] 1 KB 87

2.Whittaker v Minister of Pensions and National Insurance [1967] 1 QB 156

3.Ready Mixed Concrete v Minister for Pensions and National Insurance [1968] 2 QB 497

Using case law as examples for legal principles explain the legal position to Erica:

Erica wishes to sell her car and advertises it in the local newspaper for £5,000, giving her phone number. John sees the advert and phones Erica, arranging to come and see the car later that day, a Monday. He likes the car and offers Erica £4,000, but she says that she really wants £5,000.

Two days later, Erica phones John and says he can have the car for £4,500 and can have until Friday at noon to think about it.

The next day John meets a friend, Harry, in his local pub; Harry is also Erica’s brother. Harry tells him that Erica has sold the car to Jasmin.  John is very angry, as he had intended to buy the car. He immediately phones Erica on his mobile phone and says that he accepts her offer of £4,500, but she tells him that she has already sold the car to someone else.

1. Where a person introduces a term to a contract that excludes liability for death and personal injury then the term is:

Ans: Void

2. As of 1 October 2015 the Unfair Contract Terms Act 1977 and the Unfair Terms in Consumer Contracting Regulations 1999 no longer deals with consumers, but which Act replaced it:

Ans: Consumer Rights Act 2015

3. Which of the following is correct:

Ans: A condition is a major term of a contract

4. Which Act governs frustration:

Ans: The Law Reform (Frustrated Contracts) Act 1943

5. Which of these sentences best explains misrepresentation:

Ans: A false statement of fact that induces a party into a contract

1. What does LJ stand for in Hale LJ?

Ans: It is an abbreviation for Lord Justice.

2. How many judges normally sit to hear a case in the Court of Appeal?

Ans: Normally three judges are assigned to hear a case in the Court of Appeal.

3. What was the name of the judge who first heard the claim?

Ans: The name of the judge was Hale LJ.

4. Explain what the two citation stand for in Interfoto Picture Library Ltd v Stiletto Visual Programmes Ltd[1989] 1 QB 433, [1998] 1 All ER 348

Ans: The first citation stands for Queen's Bench and the second citation stands for all England reporter.

5. Which party won and which party did the courts say that they had sympathy with?

Ans: The People and Sunday Mirror. If anybody was mentioning the scratch card, the players had to make all at a premium rate number to see if the amount mentioned on the scratch card matched a mystery bonus. Accordingly Mr. O'Brien got two sums of £50,000. But another 1471 people also did so as the MGN has distributed too many due to a mistake. While the intention of MGN was to give one price of £50,000 therefore it held a out of these winners. In this regard, MGN pointed out towards rule five according to which a draw can be held the more prizes have been claimed. However, although rule five had been published in certain newspapers but it was not published in the July 3, 1995 edition. It was said that only the "Normal Mirror Group" rules were applicable. Mr. O'Brien had seen this notice. Therefore the issue in this case was if Rule 5 was a part of the scratch card agreement.

The Court arrived at the conclusion that Rule 5 had been incorporated in the agreement. Hale LJ stated that the rule was not a big burden on the claimant nor it excluded liability for injury but it only deprived a windfall. In this way, even if the court had sympathy for the winners but it decided in favor of the Mirror Group.  

Draw a diagram of the court system in England and Wale

Crystal Palace Football Club v Walker   

The issue that needs to be decided by the court in this case was if a footballer had been engaged by a club under the contract of service or a contract of services. In this case, this particular player was playing football for the club. He was being paid by the club and the club had also provided the house to him. However the player decided that he will not play in accordance with the instructions of the club. Under these circumstances, the decision of the court was that the footballer had been engaged by the club under contract of service. This meant that the court had held that the footballer was subject to control on part of the club. This was particularly due to the reason that the club even decides where each person was going to reside. The basic principle that has been articulated in this case deals with the organization of integration heads.

Whittaker v Minister of Pensions and National Insurance [1967]

Whittaker v Minister of Pensions and National Insurance (1967) was related with a trapeze artist. This particular artist had suffered a fall while she was performing and as a result she broke her wrist. In this case, the artist claimed industrial injury benefit as provided by the National Insurance (Industrial Injuries) Act, 1946. The issue before the court in this case was if the incident had taken place while the artist had been employed in insurable employment. This issue was brought before the Minister of Pensions and National Insurance. After going to the facts, the Minister arrived at the conclusion that the artist was not employed in an insurable employment at the time when she had suffered the fall. The reason behind this finding of the Minister was that there was no contract of service present. And the deal was made against this decision and the court arrived at the conclusion that there was a contract between the plaintiff and the circus according to which the plaintiff was going to perform the duties that were integral part of the business and these duties were not merely accessory to the business. In view of these circumstances, the court arrived at the conclusion that the artist was in a contract of service. As a result it was held that she was liable for insurance as provided by the National Insurance Act, 1946.

Part B

Ready Mixed Concrete v Minister for Pensions and National Insurance [1968]

This is the labour law case from UK that is concerned with the definition of contract of service instead of a contract for services. This difference is significant due to the reason that there are many employment rights provided by the Employment Rights Act, 1996 which need that the claimant should have the “employee” status as mentioned in section 230 of the Act. In this context, an employee can be described as someone over has a contract of service. This is a leading case related with the contract of service. In this case it was stated by the court that employment status is a matter of law. This statement clarifies that the parties to the contract do not enjoy a clear power to define and agreed that the contract is an employment contract or not employment. There is a dispute arises regarding this matter, it has to be decided by the courts.

The facts of this case are that ready mix concrete entered into a contract with others for providing delivery services for the concrete made by them. According to these contracts, the 'others' were required to provide their own Lorries in the form of independent contractors to help in the delivery of concrete.

The issue that has to be decided by the court was if these ‘others’ can be considered as employees or if they were contractors. If they were considered as employees, Ready Mixed Concrete Ltd. was under an obligation to pay the national insurance contributions for these 'others'. The decision of the court was that the 'others' were independent contractors. The reasoning on the basis of which the court arrived at this decision was following. There are three factors which decide if a person is an employee and not an independent contractor. These are wages, control on the activities of the employee and complying with the terms of the employment contract. Ready Mixed Concrete Ltd. did not have sufficient control due to which it can be said that these persons were employees and not contractors.

Using case law as examples for legal principles explain the legal position to Erica

Answer: A contract can be described as an agreement that can be enforced in a court of law. In this way, any agreement created between the parties that can be enforced in a court can be called a contract. Generally a contract is created between the parties when an offer is made by one party and the other party accepts the offer by communicating their assent to the offer or by performing the terms mentioned in the offer (Atiyah, 2000). If these terms are certain and from their conduct, it can be said that the parties had the intention that the terms will be binding, generally such an agreement is enforceable in a court.

The formation of a contract starts with an offer. For instance, an offer could be an offer of money in return of goods or an offer of services in return of other services. It can even be a promise of future payment in return of a service (Peel and Treitel, 2011). Hence an offer can be described as the expression of the willingness of the parties to agree terms among the parties. When an offer has been made, the other party can accept the offer which results in the faces of a formal agreement between the parties (McKendrick, 2009). In the same way, the other party to whom the offer has been made can also refuse the offer. Such party can also make a counter offer (Beatson, Burrows and Cartwright, 2010). A particular statement can be treated as an offer, if it can be established that the party making the offer had the intention of being bound by it (Harvey v Facey, 1893).  The law of contract also provides that an offer can be made to the whole world. In such a case, the party that has performed the terms of the offer is said to have accepted the offer (Carlill v Carbolic Smoke Ball co., 1893).  

Part C

There is a difference was in between an offer and invitation to treat. While in case of an offer, the other party is invited to enter illegally enforceable contract on the terms mentioned in the offer. However, in case of an invitation to treat, the other party is invited to enter into negotiations for the purpose of creating an offer (Collins, 2003). Generally the goods that are displayed in a shop are not treated as offers what they are considered as an invitation to treat. In such a case, an offer is made by the customer to purchase the goods (Goode and McKendrick, 2010). It is for the trader to decide if he is going to accept the offer or not (Pharmaceutical Society of Great Britain v Boots, 1953).

An advertisement that has been published in the newspaper is a good example of an invitation to treat. Due to this reason, generally advertisements are treated as invitation to treat (Partridge v Crittenden, 1968). But there are some cases where an advertisement may also amount to an offer (Carlill v Carbolic Smoke Ball co, 1893).

In the present case, an advertisement has been issued by Erica in the local newspaper. In this advertisement, she has expressed her desire to sell her car for £5,000. She has also given her phone number. This advertisement can be considered as an invitation to treat and it is not an offer. This advertisement has been seen by John who makes a phone call to Erica and arranges with her to come and see the car later that day. John likes the car and he makes an offer to purchase the car for £4,000. However the Erica refuses to accept the offer and says that she wants to sell the car for £5,000. In this case, it can be said that John had made an offer for purchasing the car. This offer was refused by Erica because she had made a counteroffer to sell the car at a price of £5,000.

After two days, Erica makes a phone call with John and says that John can have the car for £4,500. At the same time, Erica also gives time till Friday so that John can think about the offer and reply. In this case, an offer has been made by Erica to sell the car at £4,500. She had also promised that she will not sell the car to any other person until Friday. But in this case, the promise to keep the offer open is not supported by any consideration. John had not provided any consideration to Erica in return of the promise made by helping keep the offer open until Friday. The result is that John cannot enforce the promise made by Erica according to which John can accept the offer until Friday.

The next day, John meets Erica's brother Harry. Harry tells John that Erica had already sold the car to Jasmin. John immediately makes a phone call to a car and tries to accept the offer made by Erica. However, Erica tells John that she had already sold the car to Jasmin. As mentioned above, the promise made by Erica to not to sell the car until Friday was not supported by any consideration. As a result, this promise cannot be enforced by John against Erica. As the car has already been sold, the law does not allow John to accept the offer later on. In Dickinson v Dodds (1876), the court had stated that the party making the offer can revoke the offer any time before such an offer has been accepted.

When a valid acceptance has taken place, the law provides that a binding and enforceable contract is created between the parties. As a result it become significant to know what amounts to a valid consideration for the purpose of establishing in the agreement is binding on the parties. The three main rules that are related with acceptance in this regard are:- (i) the acceptance needs to be communicated to the party that has made the offer; (ii) the acceptance should be made exactly on the same terms that have been mentioned in the offer. In other words, the acceptance should be the mirror image of the terms specified in the offer; (iii) the agreement should be certain. The general rule provided in Entorres v Miles Far East (1955) is that the offeror should receive the acceptance before it is effective. In the same way, the Court has stated in Felthouse v Bindley (1862) that silence does not amount to acceptance. However, acceptance can be through conduct as was stated in Butler Machine Tool v Ex-cell-o Corporation (1979).

On these grounds, it can be said that in the present case John cannot accept the offer made by Erica after Erica had already sold the car to Jasmin. Similarly, the promise made by Erica that she will keep the offer open until Friday cannot be enforced by John because he had not provided any consideration to support this promise. Hence, Erica could have revoked the offer at any time before it was accepted by John.

References

Atiyah, P.S. (2000) An Introduction to the Law of Contract, Clarendon

Beatson, J, Burrows A and Cartwright, J (2010) Anson's Law of Contract, 29th edn OUP

Collins, H (2003) Contract Law in Context 4th edn CUP

McKendrick, E (2009) Contract Law, 8th edn Palgrave  

Peel E and Treitel, G.H. (2011) Treitel on the Law of Contract 13th edn Sweet and Maxwell

R Goode and E McKendrick, (2010) Goode on Commercial Law (4th edn Penguin) chs 3 and 4, 69–176

Case Law

Butler Machine Tool v Ex-cell-o Corporation [1979] 1 WLR 401

Carlill v Carbolic Smoke Ball co [1893] 1 QB 256

Crystal Palace Football Club v Walker [1910] 1 KB 87

Dickinson v Dodds (1876) 2 Ch. D. 463

Entorres v Miles Far East [1955] 2 QB 327

Felthouse v Bindley [1862] EWHC CP J35

Harvey v Facey [1893] UKPC 1

Interfoto Picture Library Ltd v Stiletto Visual Programmes Ltd [1989] 1 QB 433

O'Brien v MGN Ltd [2001] EWCA Civ 1279

Partridge v Crittenden (1968) 2 All ER 425

Pharmaceutical Society of Great Britain v Boots [1953] 1 QB 401

Ready Mixed Concrete v Minister for Pensions and National Insurance [1968] 2 QB 497

Whittaker v Minister of Pensions and National Insurance [1967] 1 QB 156