As per the case study, Josie and Sam weather formed a contract.
A contract is forms in written or verbal ways. The Australian Contract Law defines a promise, which is created between two or more than two parties for forming a legal relationship. A common law is based as per the English contract law. There are different elements to produce a legal contract (Andrews 2015).
- A valid contract must produce with legal aspects. Unilateral contract never accepted as a valid contract. Two or more than two parties can establish a valid contract. In a contract one party give an offer towards the other party and that party must accepts the offer. When moment second party accepts the offer, a contract had been made (Ashcroft, Ashcroft and Patterson 2016).
- The consideration must establish between the parties. The promise is made between the two parties always made if there is a valid consideration. Consideration accepts money or any property, which will be distributed into the parties. The important part of a contract defines where a promise has been formed (Berger and Wild 2016).
- The capacity of the contract is another important conduct to establish a valid contract. The parties should sound mind, have capacity to keeping, and fulfill the promise as per mention of the contract. The particular promise should made between the parties.
- The legal intention of the parties forms a valid contract. Wrong intension stated the contract void according the Australian Contract Law. Both of them have a legal intension at the time of formation the contract (Andrews 2015).
- The certainty of the agreement should present in the contract. When the contract agreement establish, from that time, the agreement must satisfy legal rights and obligation of both parties. The certainty is important if parties failed to perform according the contract. The promise are included in the agreement always affect the parties (Ashcroft, Ashcroft and Patterson 2016).
Revelations Perfume and Cosmetics Inc. v. Prince Rogers Nelson is a famous case, which stated the facts of breach of contract where in 2008 this famous company Revelations Perfume and Cosmetics complain against one famous musician Prince for damaging around $100,000. He promised them to promote their new launch perfumes through his new song album (Berger and Wild 2016). However, when the company asked him to give interviews for promoting the project of perfume launching but he refused to give and breach the contract with the company. The court found that it satisfy all the condition of breach and therefore it stated the breach of contract case where the Prince failed to perform according the agreement and cause damage to the innocent party. However, the contract has been breached by the aggrieved party but the court failed to found any evidence against Prince. Nevertheless, he was found perform with harmful activities with the innocent party so the court ordered to give fine about $4 Million to the cosmetics company for paying the damages where the company is out of pocket expenses (Berger and Wild 2016). The postal rules also applied in this case because as per this act a contract can be made between two parties through an email or phone.
A breach of contract also stated in Revelations Perfume and Cosmetics Inc. v. Prince Rogers Nelson. In this given case study, one party failed to act according the contract and breached. Macy’s v. Martha Stewart Living is another famous case of breach of contract where remedies have been paid. In this case, Macy’s is a department store who makes allegations against Martha Stewart living Omnimedia for breaching a contract with them. They complaint that the Martha Stewart living Omnimedia who make an agreement with Macy who is allowed a mini retailer to sell goods from the shop. The Macy has argued about the rights to sell the products according the signed contract in 2006. However, in this case the court found Macyaccep the offence and guilty for the offence and ordered to pay the punitive damage to Martha Stewart living Omnimedia. Legal fees always pay the damage remedies. It establishes the facts of actual breach (Ashcroft, Ashcroft and Patterson 2016).
i. As per the case study,
- Josie who is a painter form a written contract with Sam who is the buyer whom he will sell one of his sunflower paintings in $800 to Sam which have validity till last Tuesday 21st However, when an art enthusiast comes in Josie’s studio and asked for buying the same sunflower painting in $900 in cash and without inform to Sam , Josie sell that to her. Josie signed that form and a contract had been formed (Doty 2015).
- When Josie sells the sunflower painting Wendy at $900, he breached the contract that she had made with Sam. According the contract law, Josie failed to satisfy all the phrases of a contract. Therefore, the contract has been breached.
- Sam can take legal actions against Josie for breach the contract that he has promised to give him the painting at $800 to him as per the signed form. However, Josie had send message to Sam about the sunflower painting but due to some machinery fault, Sam did not receive any call.
- When Sam stated the offer with Josie where he shows interest to buy the sunflower painting at $700 and Josie negotiate that offer and told him that she will not accept more than $800 Sam who is the buyer accept the offer.
- He also mentioned to Josie about to take concern of his wife before buying it. When Josie accept the offer he made a form where it is mentioned that he will sell his sunflower painting to Sam and that offer will expire till 21stFebruary (Doty 2015).
- The agreement is formed when both parties stated the mutual consent and legal intension.
- They had one common mutual understanding to make the contract where lawful objects also part of the contract.
- When Josie sold the painting to Wendy, he breached the contract with Sam. He failed to act as per the contract (Andrews 2015).
- After he sells his sunflower painting to Wendy, he tried to call Sam but failed. Here the postal rules can be applied but that was not enough to pleased Sam. Josie must need to wait until 21 February when she failed to contact with him. Therefore, Sam can ask for remedies from Josie.
- When Josie denied call from Sam, that moment the contract has been terminated and Josie became liable for it.
- When the damage has been found in any contract, then the remedies also be applied as per the Contract Law.
- The remedies mainly accepted as liquid money to the innocent party. When damages are claimed from aggrieved party, the innocent party should clear about the damages in the contract. According the case study, it is a case of actual breach of contract where the involved parties failed to act according the time of contract.
According the case study, the contract was formed between Josie and Sam has where they stated the mutual consent and legal intension to form the contract but they failed to maintain the contract (Andrews 2015). The postal rule also applied in this case. A contract can be formed through a telephone or email therefore the contract between both parties may be before the call was made but there is no communication establish between the parties. Therefore, Sam and Josie are under the agreement and as Josie not able to communicate so the contract will be continue but Josie breach the contract.
Here, as per the Revelations Perfume and Cosmetics Inc. v. Prince Rogers Nelson and Macy’s v. Martha Stewart Living in both case are about actual binding contract (Doty 2015). The both of the aggrieved parties had breaches the contract with the innocent parties. In both cases, the court found the offences of breach and fined with the damages. The remedies are take place. They have made a valid contract but later they failed to perform as per the contract and terminate the contract that becomes the cause of contract (Davies 2016).
As per the issue of the case, Sam who is the innocent party in the agreement had suffered the damage. He has the right to sue Josie for denied to perform as per the agreement and cause breach.
As per the case study, the issues of the case are briefly concluded that it is a case of breach of contract. Josie needs to wait until 21 Feb before his sale his sunflower painting. For own benefit and profit he sells to another party who is not in the contract. He also promised to Sam that he will wait for her wife’s consideration made the form and signed that. However, he failed. In Revelations Perfume and Cosmetics Inc. v. Prince Rogers Nelson and Macy’s v. Martha Stewart Living, cases are the example of breach of the contract, which can relate with the given case study. The contracts are the actual contract and they breach the contract for failing to perform as per the agreements.
A contract can form and if any party, breach the contract then the remedies also available. As per the given case of breach of the contract between Josie and Sam, though Sam not sued Josie for breached but he may take legal actions against Josie. When Josie sells the sunflower painting Wendy at $900, he breached the contract with Sam. Therefore according the contract law, Josie failed to satisfy all the terms of a contract. Therefore, the contract has breached. Josie failed to perform as per the elements of legal contract, consideration, capacity, legal intention and certainty.
As per the case study when Sam made an offer with Josie that he is interested to buy the sunflower painting at $700, Josie negotiate the offer and told Sam that she will not accept more than $800 Sam who is the buyer accept the offer. However, he also mentions to Josie that about to take his wife’s concern before buying it. When Josie accept the offer he made a form where it is mentioned that he will sell his sunflower painting to Sam and that offer will expire till 21st February. Before 21st, Josie sells the sunflower painting to another art enthusiast on 20 Feb in $900. Though Josie got a great deal with Wendy, he should wait for Sam because already he made a contract with him. Josie messaged the information to Sam but due to the machinery problem, he did not get the message (Davies 2016).
Josie breaches the contract with Sam. When the contract had been formed Josie and Sam became parties who have entered into a valid contract. The agreement is made when both the parties have mutual consent and legal intension have stated. They had a common mutual understanding to form the agreement where lawful objects also included. At the time when Josie had sold the contract to Wendy, he breaches the contract with Sam. He failed to satisfy all the elements of the contract (Doty 2015).
In the cases of Revelations Perfume and Cosmetics Inc. v. Prince Rogers Nelson and Macy’s v. Martha Stewart Living also described that how parties can breach the contracts. In these both cases, the court ordered the aggrieved party to give the remedies to the innocent or suffered parties. They made the contract in mutual consent but then failed to perform as per the contract. As per the Australian Contract Law, a contract is breached when the contract failed to act as per the condition and the parties breach the warranties for performing the contract. When the damages have been declared in any contract then there are some remedies also as per the Contract Law. The remedies can be accepted as liquid money or any other compensation. . When the damages are claimed, the innocent party must clear they are the damages in the contract. As per the case study, it is a case of actual breach of contract where the involved parties failed to perform the as per the time of contract. It is the most common breach of contract in Australian Contract Law (Chng and Goh 2016).
2. Pinnel’s Case
Pinnel’s case  5 Co. Rep. 117a was a famous case of English Contract Law which also known as Penny vs. Cole where the concept of the doctrine of part performance was described briefly. This case is related to the part payment of any debt, which is not for a good consideration but promise to get back the balance. Pinnel sued Cole for failed to fulfill the promise for the sum of $8 10s which was debt upon a bond. However, Cole was argued that he tendered $5 2s as per the Pinnel’s request before the due of debts which was accepted by the plaintiff in full satisfaction for the debt.
When a contract had been formed, the promise arose along with the acceptance of the agreements. The offer, acceptance, intension and consideration are the most important in a consideration agreement. In the Pinnel Case, the creditor had promised to pay the debt amount to the debtor without the consideration.
As per the legislations of the rule it is stated in the Pinnel Case in the consideration the payment of the debt never discharge the obligation because if the creditors make the promise without the consideration with the debtor then debtor will not liable to pay the amount in full payment (Goldberger 2015). The court had been notice in the case that the less amount of the main amount is paid before the due date and the rest of the amount must be paid on the directed date (Chng and Goh 2016).
The court also stated that if the creditor gift to debtor a horse, hawk or any robe which will satisfy the amount and beneficial to the debtor then it fulfill the consideration of the debt amount. However, if the creditor had failed to satisfy the benefits to the debtor then the consideration of the debts will not accepted in the agreement. The court found that the payment and acceptance of fewer amounts on the specified date, which was mentioned in the agreement of the debt where the valid consideration is, required (Doty 2015).
Foakes v Beer (1884) 9 App Cas 605 is another case where a judgment was deliver to Mrs. Beer for a debt against Dr. Foakes who have asked the debt in time. Mrs. Beer stated that she would not take any action against the matter where Dr. Foakes need to pay her $500 in urgent and the rest amount must be paid as an installment . Moreover , the debt include the interest and in this situation the court have give order that she must be paid the amount with the interest and Dr. Foakes not satisfied her promise as per the debt of the agreement. Therefore, she should not provide any consideration to him (Chng and Goh 2016).
Therefore, Cole promised to pay Pinnel due amount on 11 November where Cole was argued that Pinnel had requested to him to pay the $5 2s on 1st October and which was Pinnel accepted in a mutual agreement of the debt. However, as per the case study is was stated on the mutual agreement between Pinnel and Cole that is the part payment must binding if the debtor accept the agreement as per the request of creditors (Carcieri 2016).
The consideration will provide to the creditor if he accept the terms of debtor. The terms are:
- When the part has, payment is paid before the due date.
- When the chattel is provides in exchange of the debt money.
- When the part payment is given in a different place rather than the original amount of money.
There are some exceptions available for the consideration of the debts. The rules that are mentioned in the Pinnel case, where some exceptions are included. When the creditors approve the agreement of accepting the amount then the consideration of the agreement must specified in proper way. When the part payment of the debt had to pay by a third party. When a promise was made as per the amount of the amount of the debts, which was fully paid by a third party on condition that when the debtor will have no obligations to pay the full amount of money as per the agreement. This is case is related with the doctrine of promissory estoppels. In this matter, when a promise has been formed, the promissory estoppels can be included if the consideration was not introduced.
The basic estoppels are applied to those agreements where the included facts never extended in the future, if that extent then the consideration will not allowed. If any issues arise then consideration will not use its place. In general, estoppels the existing facts must represent the intension of the creditors. This limitation is included in the Central London Property Trust Ltd vs. High Trees House Ltd (1947) KB 130 (Carter 2014).
When the estoppels applied to the promise of future or include then it will be treated as promissory estoppels which was followed briefly in the Foakes v Beer (1884) 9 App Cas 605. If the promissie failed to satisfy up to the promise then no damage will took the place. In Pinnel’s case, the debt without consideration will refuse the development in England where the doctrine of promissory estoppels applied as per the law and regulations (Liebenberg et al. 2014). In the promissory estoppels a person can go back as per the promise which will represents the facts of consideration. When parties enter into the agreement, they have to apply their legal intensions in the agreements. The parties are binding as per their promise to each other. In such matter, that will not allow anybody to fail to keep the promise, which have no consideration (Carter 2014).
As per the comments of Judge Denning J, the estoppels in Central London Property Trust vs. High Trees House Ltd (1947) KB 130 are strictly followed. The judge follows the solution in the Pinnel’s case as per the above-mentioned case solution. When the creditors are estopped from the given promise where the future intension is not included then the creditor have no right to sue the debtor for the consideration amount. As per the brief description, the promissory estoppels are applied to various cases.
The application of promissory estoppels is applied in the case of Pinnel’s case  5 Co. Rep. 117a. Various judges criticized the judgment. The doctrine of promissory estoppels has solved the Pinnel’s case very effectively (Carcieri 2016).
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Foakes v Beer (1884) 9 App Cas 605
Revelations Perfume and Cosmetics Inc. v. Prince Rogers Nelson
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