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Elements of a Contract

Question:

Discuss about the Essay for Commercial Law and Law of Torts.

The scenario that is provided depicts that Alan went to the shop of Ben for making the purchase of Russian vodka. After his visit, he made asked Ben for three bottles of vodka that is Russian. Upon his inquiry, Ben gave the answer that the bottles that Alan was holding in his hand are of the same description that was demanded by him. Alan then made the purchase of those bottles, paid money for the same, and received a receipt from Ben in exchange for that purchase. 

In the above context, we can say that as a result of the purchase, there exists a contractual relationship between them. According to the law of contract, any contract stands as a document that is more than a mere agreement, and that possess the feature of enforceability in the court of law (Barker, Lunney & Trindade, 2012). Hence, it can be said that the contract acts as agreements that exist between more than two persons that make the formation of obligations that are enforceable wither for doing or refraining from doing any particular act. Several elements must be followed by the formation of a contract. Those elements are the consideration, offer, intention, legal capacity and acceptance (Bridge, 2012). 

The primary element of a contract is an offer. Either one party of any contract makes such offer. The person who indulges himself or herself in the offer making is known as the offeror. The person to whom the offer is made is known as the offeree. In the scenario, Alan made the invitation to Ben make him the offer. Receiving that offer, Ben caused himself to offer Alan to make the buy of bottles of vodka. In the case of Gibbons v Proctor (1891), there was a policeman who was allowed to make the recovery of a reward at that time when he sends the information by being ignorant of the offer of that reward (Brudner, 2013). 

The next element known as acceptance is also of immense importance. Once the offer is made, it has to make by the other party or parties in any contract. The party who makes the acceptance in any contract is known as the acceptor. After the acceptance is made, the same has to be appropriately communicated to the person who made that offer (Calfa & Grossmann, 2015). The moment the acceptance is communicated appropriately the performance procedure by the offeror is to start. In the scenario that is given, the Alan made the acceptance of Ben’s offer of buying three bottles of Russian vodka.

The next element is the consideration. It is that amount that is provided by a party of any contract in the exchange of the service to the other parties of the contract. The consideration is often regarded as the essence of any contract. Any contract is entered into only for consideration. In the provided scenario, Alan renders the considered to Ben for the supply of the bottles of vodka. In the acknowledgment of that payment of consideration, Ben gave Alan the receipt for that payment. 

Definition of Goods and Warranties under Sale of Goods Act

The intention of the parties to any contract also acts an element that is important for the formation of any contract. In any contract, there has to be the intention of the parties to any contract, which is generated by their free will and not under any force. In the case study, there is the intention of the parties that is Alan and Ben to make the dealing and thus entering into the contract. 

The legal capacity is also an important contractual element. The law of contract makes the express statement that during entering into a contract a person must attain the legal age that is eighteen years and must not be under the effect of alcohol (Crump, 2013). Any bankrupt and a prisoner are also not allowed to enter into a contract. Alan and Ben both have the legal capacity to enter into an obligation that is contractual.

Hence, from the above discussion it can be said that there exists a valid contract between Ben and Alan, as all the elements of a contract are present in their dealing.

The Sale of Goods Act governs the transactions where by any person who is known as the buyer make the transfer of goods to any person known to the seller, for the payment any amount that is known as price or value. Under the Sale of Goods Act, the contract for the sale of goods and services makes its involvement in the making of the regulations and rules for both contracts of sale and contract of sale. Part 1(h) of the Sale of Goods Act delivers the definition of the term goods. The term goods under the Act make the inclusion of all kinds of moveable and excludes claims and money (Davies, 2016). Timber, growing crops, shares and stock are included in the term goods.

There are several warranties that are guaranteed by the Act that tends to render protection to both the buyers and sellers. In Part 1, of Sale of Goods Act of the territory of Singapore declares those warranties that render protection to the buyer's interest from the intentions that are fraudulent of the seller. There is implied warranty that is guaranteed by Part 1 of Section 15 of the Sale of Goods Act of Singapore for the goods that are sold by way of description. In the simpler terms, the goods that mean that whenever any goods are sold by way of description, the goods must comply with the qualities that exist in a description (Durkheim, 2014). 

In Part 5 of Section 53 of the Sale of Goods Act of Singapore, deals with setting out the rules and the norms that are to be followed by a buyer in case of breach any warranty by any seller. The Section states expressly that any buyer is always entitled to bringing any legal action, for making the breach of any warranty, against seller (Eggen, 2015). In the additional terms, there is also the entitlement to the buyer to make settlement of violation of any warranty by making the reduction of the price of purchase. 

Entitlements of Buyer in case of breach of warranty

The present case suggests that the seller is Ben, and the buyer is Alan. There was the clear demand or requirement by Alan that he wants to make the purchase of three bottles of vodka that is Russian. When Alan made his entry at the liquor shop of Ben, he held some bottles of vodka in his hands and demanded his requirement of Russian vodka to Ben. The reply of Ben was that the bottles in the hands of Alan fulfill his requirement. On getting that reply, Alan made the purchase of the drinks and offered his friend, who got ill as a result of drinking those drinks. Upon making the inquiry, it was found out that the drinks delivered by Ben were not originally Russian vodka and were illicit drinks. Hence, it can be said that Ben made the violation of Section 16 and 15 of the Sale of Goods Act by making the supply of illicit drinks in the place of Russian vodka. For the act of Ben, Alan is entitled to bring the legal action or claim against Ben.

The receipt that was issued by Ben to Alan for the payment of money of the bottles of vodka enshrined the statement that the products that are sold once from the shop of Ben are not subject to refund. The receipt also enshrined the words that that seller also is not responsible for the safety of the products that are sold by the shop. Hence, in accordance with the words of the receipt, there is no liability of Ben if the products of him were unsafe in any (Furmston, Cheshire & Fifoot, 2012). 

The primary issue that is involved in this scenario is that whether the receipt that is delivered by Ben to Alan amounts to a contract that ism enforceable in the court of law. The receipt can never be considered as a contract. It is because the receipt is a mere acknowledgment of the fact that Alan made the payment of money for the bottles of vodka that is purchased. The receipt is neither an agreement nor a contract that is enforceable in any law court (Furmston & Tolhurst, 2010). The receipt in the court of law would be considered as the evidence of the payment of consideration by any justice, in deciding the contractual relationship that exists between them.

The contract that exists between the two parties that is Ben and Alan is not express but implied. The presence of the contract between is evident from the dealing between them. There is a reputed case named Olley v Marlborough Court Ltd, where Olley could not find the keys of hotel that she left in a safe position in the reception. A disclaimer by the hotel authorities makes the express statement that the proprietors would not held themselves liable for the loss of articles unless the managers of the hotel for their safe custody handle those articles (Hunter, 2015). The Court held that the fault was on the part of the hotel authorities for acting negligently. It was evident that Olley kept the keys of the hotel at the reception. Hence, the disclaimer that was issued on the part of the hotel was regarded by the court as not a part of the contract, and the hotel cannot rely on that disclaimer (Markovits, 2015).

The contract that existed between Alan and Ben depicts that Ben was under the duty to make the performance of the contract by the delivery of the exact requirement that was demanded by Alan. By the delivery of illicit drinks, Ben made the breach of the contract terms and the violation of the provisions of Sale of Goods Act. Hence, there lies the option that is available to Alan for suing Ben. In that suit, Alan could either claim for refund against the faulty products that were rendered by Ben or could claim for damages for the loss that he sustained for the unsafe goods Ben delivered. In that suit, the receipt of Ben would be neither valid nor enforced. The Court would never consider such receipt (McKendrick, 2014).

The scenario that is to be discussed in the last questions suggests that the friends of Alan got affected by the disease of diarrhea. As a result drinking the drinks that were delivered by Ben. The primary issue that was involved in the case that is whether there lies any claim on the part of friends of Alan against Ben.

The issue that is involved in the case can be resolved by the application and the discussion of the principles of foreseeable conduct and proximate cause in the law of torts. There is also the requirement of the discussion of the principles of negligence in a resolution of the issues (Mullender, 2013).

In the tort law, there is the requirement on the part of any person to take that reasonable care in order to avoid omissions or act that could foresee reasonably in the injury of any other person. In the case of Nettleship v Weston [1971] CA, it was held by the Court that at the time of driving any motor car, it is foreseeable that any passenger or other users of the road are affected directly in case the driver is careless (Poole, 2012). In the case of Margereson v Roberts [1996] CA, the Court held that children who play near the factory of asbestos have the risk of suffering from a disease called mesothelioma. Hence, the working of the factor would be considered as foreseeable to the harm of those children (Rose, 2013).

The term proximate cause refers to the primary cause of an injury. It is not necessary that the proximate cause would be the closest cause in either space or time or the first event that is responsible for setting the events in motion or in the sequence that led to any injury. The principle of proximate cause is involved in making the production of the consequences that are foreseeable without the intervention of any unforeseeable cause. The term proximate cause is also referred to as the legal cause (Schwenzer, Hachem & Kee, 2012).

The term negligence refers to the failure of any person to take the care of something which was under that duty of taking care and failed to take that care. The essential feature of negligence is that the failure of any person to take that care also amounted to the loss of any other party (Yeo, 2012).

In the case that is given the foreseeable principle, proximate cause and negligence is applicable. The sustaining of diarrhea by the friends of Alan is foreseeable to the act of Ben, and the proximate cause of that disease is the act of Ben. The principle of negligence suggests that Ben was under the duty of delivering genuine drinks to Alan. Ben made the breach of his duty by giving Ben illicit drinks. The transferring of the illicit drinks has lead to the health problems of friends of Alan. Hence, it can be said that Ben was negligent that lead diarrhea of Alan's friends. It is evident that there is no contract between Ben and friends of Alan. However, by the application of the principles of foreseeable conduct, proximate cause and negligence makes it clear that Ben is responsible for the health hazard of friends of Alan. Hence, those friends have the right to sue Ben.

Reference List

Barker, K., Cane, P., Lunney, M., & Trindade, F. (2012). The law of torts in Australia. Oxford University Press.

Bridge, M. G. (2012). Benjamin's sale of goods. Sweet & Maxwell.

Brudner, A. (2013). The unity of the common law. OUP Oxford.

Calfa, B. A., & Grossmann, I. E. (2015). Optimal procurement contract selection with price optimization under uncertainty for process networks.Computers & Chemical Engineering, 82, 330-343.

Crump, D. (2013). How to Read a Contract Proposal Written by Someone Else, or Evaluating the Seven Elements of Agreement. Fla. St. U. Bus. Rev., 12, 109.

Davies, P. S. (2016). JC Smith's the Law of Contract. Oxford University Press.

Durkheim, E. (2014). The rules of sociological method: and selected texts on sociology and its method. Simon and Schuster.

Eggen, J. M. (2015). Mental Disabilities and Duty in Negligence Law: Will Neuroscience Reform Tort Doctrine?. Indiana Health Law Review, 12, 591.

Furmston, M. P., Cheshire, G. C., & Fifoot, C. H. S. (2012). Cheshire, Fifoot and Furmston's law of contract. Oxford university press.

Furmston, M., & Tolhurst, G. J. (2010). Contract formation: Law and practice. Oxford University Press, USA.

Hunter, H. (2015). Modern Law of Contracts.

Markovits, R. S. (2015). TORT-RELATED RISK COSTS AND THE FIRST-BEST ECONOMIC INEFFICIENCY OF THE HAND FORMULA FOR NEGLIGENCE: HOW TO FIX THE FORMULA WHEN IT CAN BE FIXED AND WHY IT SOMETIMES CANNOT BE FIXED.

McKendrick, E. (2014). Contract law: text, cases, and materials. Oxford University Press (UK).

Mullender, R. (2013). English Negligence Law as a Human Practice. Law & Literature.

Poole, J. (2012). Casebook on contract law. Oxford University Press.

Rose, F. D. (Ed.). (2013). Contract, Tort & Restitution. Oxford University Press.

Schwenzer, I., Hachem, P., & Kee, C. (2012). Global sales and contract law. Oxford University Press.

Yeo, T. M. (2012). The Future of Promissory Estoppel in Singapore Law.

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