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Discuss about the Regional Harmonization Of Contract Law In East Asia.

Elements of a Valid Contract

The aspect of offer and acceptance are two of the key elements of a valid contract. The present case presents information which is open interpretation. There are several instances where contracts have been breached or rescinded due to miscommunication. It is important to note in this case that David and Edwin have been colleagues and both lover of Badminton and hence that is where their interest lies. As per the information given, both David and Edwin could interpret the situation in their own way. In this case David doesn’t have any entitlements from Edwin because there was never a formal contract established between David and Edwin. Both Edwin and David have are interested in Badminton and latter has had a verbal communication about UBC winning the championship which would help Edwin to receive $10,000 from Freddy, but there was no formal contract between David and Edwin. Had there been any contract one would find the elements of contract between David and Edwin which is missing in this case (Han, 2013 p, 39).

According to the Contract Law of Singapore which is pretty similar to the English Contract Law states that a contract is only valid when all the elements of contract especially an offer and acceptance is visible. Edwin never promised anything verbally to David about him winning the championship for UBC hence there was no consideration. Edwin never offered anything to be precise any part of the promised $10,000 from Freddy to David which clearly shows that Edwin in a friendly manner asked David to win the championship so that he could get the promised amount of money from Freddy. The rule of offer and acceptance is almost same everywhere and this is clearly discussed in a case held in Singapore Court is Lim Koon Park v Yap Jin Meng Bryan [2013] 4 SLR 150 (“Lim Koon Park”). In this case it was clearly stated by the judges that offer and acceptance have to be objective and clear. In this case Edwin never offered anything to David that is pretty similar to the situation in the case Harvey v Facey [1893] where there was no offer and acceptance as they did not show any intention to get into a legal contract which is important to claim for any part of the payment or compensation from the court of law (O'Sullivan & Hillard, 2016 p, 131). Hence it could be said that if David wants to claim for any entitlement he would have to argue in the court about his activities which clearly showed his interest to be a part of the bargain. Even though silence is not considered as acceptance to an offer which is clearly stated in the case Felthouse v Bindley [1862] EWHC CP J35 he could argue that he increased the practice session from two shifts to four shifts after communicating with Edward regarding this. Hence to conclude it could be said that in this case since there was no contract written or verbal between Edwin and David the latter wouldn’t have any entitlement or the former wouldn’t have any liabilities emerging from the present case as the basic elements to form a valid contract is missing (Bix & Bix, 2012 p, 44).

Offer and Acceptance in the Present Case

It is important to note that a contract is formed only when there is offer, acceptance, consideration and intention to get into a legal contract. In the present case there was no element present between David and Freddy because both of them never had direct conversation regarding the present issue. Hence this aspect is quite clear that David and has no entitlements from Freddy in this case as he didn’t have any conversation regarding the championship. Freddy did not communicate with David regarding the badminton and never met him on this subject. Hence there is no way that both could form a contract as per the information available. Hence it could be said that David cannot have any claims against Freddy because Freddy communicated with Edwin regarding this and whatever conversation they both had, was communicated to David by Edwin and Freddy is in no contact with David (Hughes, Champion & Murdoch, 2015 p, 54). Even though the offer was directly made by Freddy he was not aware that David is involved with UBC which clearly shows that it was mere coincidence and it has nothing to do with the contract verbally taking place between Freddy and Edwin. Edwin stated that he was banking on David to win the championship and if he does that Edwin is going to receive $10,000 from Freddy which shows that Freddy committed to pay the amount to Edwin and not to David. Hence it could be concluded that even though David is not entitled to anything from anyone of them and even if he did it would be from Edwin and Freddy because there was no direct conversation between Freddy and David regarding the promise.  So, Freddy doesn’t have any liabilities even (Rajah, 2012 p, 87).

According to the information available it is clear that Edwin and Freddy communicated regarding the Badminton championship and from his side Freddy committed that Edwin could anytime take $10,000 from him if UBC wins the championship. It is important to note that Freddy clearly understands what he has committed is likely to keep the promise because there was a clear acceptance from Edwin on this matter which makes the entire thing valid. In the case of Zhu Yong Zhen v AIA Singapore Pte Ltd [2013] SGHC 37 (“Zhu Yong Zhen”) it was clearly stated that a contract only attains completion when there is presence of offer, acceptance, consideration and legal intention to form a contract (Phang, 2012 p, 74). In the present case Freddy from his side committed that he would pay $10,000 if UBC wins the championship and Edwin accepted but it wasn’t communicated that what would happen if UBC loses which means that there was no discussion on this aspect which clearly makes the case confusing.  Even though UBC won the championship it should have been clearly stated as to what could be done if they lose. Hence it is clear that the liability was only one sided pretty similar to a unilateral contract where the offeror offers to pay against a particular act. Hence it could be said that this was much of bait on UBC as Freddy promised to pay to Edwin (Andrews, 2015 p, 112-114).

David's Entitlements and Liabilities

It is extremely important to make sure that before a contract is established it is important to discuss the conditions on which the contract stands.  One of the most common cases that will help to understand the present situation between Freddy and Edwin is the case Carlill v Carbolic Smoke Ball Company [1892] EWCA Civ 1. This case helps to understand one sided promises effectively. In this case the Carbolic smoke ball company promised to pay £100 to any person if he or she catches influenza after having the ball three times daily. Carlill relied on the ball but caught cold and sued the company for the claim. The court held that the advertisement published by the organisation to be considered as a unilateral offer and hence the organisation has to pay to Carlill. The present case is quite similar as Freddy promises to pay to Edwin if UBC wins the championship (Phang, 2012 p, 76). Hence to conclude it could be said that since UBC won the championship Edwin is entitled to receive the amount promised from the Freddy as it was a unilateral offer which if not practiced could bring legal implications for Freddy is Edwin is willing to sue him from the breach of the contract as the consideration which binds the contract is not practiced effectively. So, Edwin is entitled the promised money that is $10,000 (Rajah, 2012 p, 132).

If David and Freddy was to sit together and Freddy made the offer to David directly then there would be no question of confusion as it is clear that the unilateral contract is made with David. Then David could have banked upon the word of Freddy and could have claimed the money for winning the championship personally.  Instead of Edwin if David was to receive the offer he would have definitely acted differently to achieve the feat and hence then the contract would have become valid as he would reply to the offer made by Freddy (Poole, 2016 p, 25-27). Even if the person changes the contract would remain the same which means it would still be a unilateral contract. Hence then Freddy would be liable to pay to David for his feat because he promised to pay David that amount of money and legally then David will be entitled to the money which clearly changes the answer given in b. The answer in B was written with the information that David and Freddy do not have any direct contract or communication regarding the money and championship but in this case the scenario changes and with the change in the scenario the answer changes because in this situation if David is the acceptor of the offer it would then make him the person solely entitled to promise made by Freddy (Poole, 2014 p, 21). In the case of Lim Koon Park v Yap Jin Meng Bryan and others [2015] SGHC 284 it was made clear that offer and acceptance stands to be two key elements of a contract as consideration is normally present in a contract which clearly establishes the contract as valid. Hence if Freddy promised the same to David as he did to Edwin this would establish a unilateral contract which would then make it important for Freddy to pay to David (Furmston, Cheshire & Fifoot, 2012 p, 234-235).

Freddy's Offer to David and Its Implications

If David was not aware of the promise the Freddy made to Edwin but Edwin separately promises David to pay $5,000 then there would be another unilateral offer made by Edwin to TBC and then there would be entitlements for David from the side of Edwin. If this was the scenario where Edwin offers David money and David was galvanized due to this and makes better effort to win the TBC then it would clearly be a situation where David would be entitlement for the payment as he did what he was asked to do. As per the definition of unilateral contract David has to complete his job successfully which makes him entitled to receive the payment of $5,000 (Hunter, 2017 p, 145). According to the common law of contract in different states including Singapore unilateral contract is established when a promise is made in return of doing of a particular act which is clearly visible in this case. Dickson trading (s) pte ltd v transmarco ltd [1987] slr(r) 674 at [39]. 66 is a classic case of unilateral contract in Singapore which clearly highlights the present scenario where an offeror promised to do something against an act done successfully and the claimant won the case stating that the offer was unilateral in nature and hence no one except the offeror owes the duty of meeting the offer made and to fulfill the promise. Daniel John Brader and Others Vs. Commerzbank Ag - Court Judgment also shows the similar verdict from the court because it makes the legal and moral duty of offeror to fulfill the promise if the work is successfully done by the other party (McKendrick, 2014 p, 120). Hence even if David is not aware of the promise made by Freddy to Edwin and Edwin in order to boost David promises to pay $5000 to win the championship in such a scenario David’s entitlement would be there from Edwin because David completed the job successfully even though he was silent on his side regarding the acceptance of the offer he would be entitled to receive the amount promised by Edwin because then the payment of promised money would be legal obligation for Edwin as the promise created an unilateral contract from his side with David which if not fulfilled will bring legal implications against him (Han, 2013 p, 118).

References

Andrews, N., (2015). Contract law. Cambridge University Press.

Bix, B. & Bix, B.H., (2012). Contract law: rules, theory, and context. Cambridge University Press.

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

Han, S., (2013). Principles of Asian contract law: an endeavor of regional harmonization of contract law in East Asia. Vill. L. Rev., 58, p.589.

Hughes, W., Champion, R. & Murdoch, J., (2015). Construction contracts: law and management. Routledge.

Hunter, H., (2017). Modern Law of Contracts.

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

O'Sullivan, J. & Hilliard, J., (2016). The law of contract. Oxford University Press.

Phang, A.B.L. ed., (2012). The Law of Contract in Singapore. Academy Publishing.

Poole, J., (2014). Casebook on contract law. Oxford University Press, USA.

Poole, J., ( 2016). Textbook on contract law. Oxford University Press.

Rajah, J., (2012). Authoritarian rule of law: Legislation, discourse and legitimacy in Singapore. Cambridge University Press.

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