Contract Law

Contract Law

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Contract Law

Formation of Contract

The formation of a contract comprises essentials that illustrate the existence of an agreement voluntarily by the parties. The two main elements of a contract comprise Offer and Acceptance. The other elements include intention to develop legal relations, consideration, capacity and formalities Parties have to assent jointly through the inculcation of these elements. As such, the pact between the parties consists of an Offer and an Acceptance in which the first party, the Offeror, initiates an offer, of which the other party, the Offeree, accepts. Interestingly, if the offeree, in accepting the offer, initiates an acceptance that varies the conditions of the offer, then it is a counteroffer and as such, is a rebuff of the initial offer (Andrews, 2011). Alternately, by initiating an offer and accepting the offer, both parties necessitate the intention to bind themselves legally.

Furthermore, the parties, which constitute a promissor and a promisee, in forming a contract require a promise of an act or restraint to act between both of them. This is consideration since the promissor provides the promisee with an object of importance in order to receive another object of significance from the promisee. In addition, for both parties to initiate a contract, both have to possess contractual capacity in the sense that their capacity should allow them to enter into a contract as per the law (Samuel, 2007). As such, the element of capacity protects certain parties from exploitation. Consequently, for formation of a contract, various formalities are evident. The rationale behind the inclusion of formalities involves the mitigation and deterrence of fraud. Moreover, the formalities arise out of statute and thus govern the contract.

Contract Performance

Performance differs in accordance with the circumstances at hand. In the event of performing a contract, the respective contract assumes the status of an Executory contract. Additionally, after the completion of contractual performance, the contract becomes an Executed contract (Andrews, 2011). Nonetheless, in the event that a contract receives incomplete performance, compensation is eligible for the performing party.

Conditions

Conditions represent the stipulations provided for within every contract. As such, the provisions within the contract subject the respective parties to contractual obligations. Usually, the conditions are in different categories based on the jurisdiction or the milieu. Moreover, the contractual terms conceive conditions, which gain distinctions from warranties. In this sense, breaching a condition by a party enables the affected party to repudiate and receive discharge from the contract. On the other hand, the warranty advocates for the use of remedies and compensation but not discharge (Samuel, 2007). As such, a condition is a nonspecific expression whereas a warranty is a guarantee.

Breach and Remedies

A breach with respect to a contract illustrates failure in performing the terms provided within the contract. As such, a breach is a lawful ground of action since it involves the action of dishonoring a contract by a party through non-performance or intrusion with the other entity’s performance. Usually, breaches are major or minor with respect to contract performance. A minor breach involves substantial performance in which a party does not perform the contractual obligations fully (Ribeiro, 2002). A breach is major when the party exhibits non-performance and breaches the condition/s stipulated within the contract. Depending on the types of breach, the remedies awarded for the non-violating party focus on both definitions. These remedies comprise the compensation that the non-violating party receives based on the breach of the breaching party.

Contract for the Sales of Goods

A Contract for the Sale of Goods refers to a legal contract that involves the trade of commodities, property or services between the vendor and the purchaser depending on the value agreed by either parties or a promise to reimburse the value. Usually, the contract specifies the conditions each party has to meet. As such, the seller provides particulars that he or she has to adhere to in order to ensure that he or she fulfils his or her obligations. As such, the seller provides the amount for the commodities, the capacity, the appointment and the delivery of the goods (Bridge, 2013). Thus, the seller is the offeror and the buyer is the offeree.

References

Andrews, N. (2011). Contract law. Cambridge: Cambridge University Press.

Bridge, M. G. (2013). The international sale of goods: Law and practice. Oxford: Oxford University Press.

Ribeiro, R. A. (2002). Damages and other remedies for breach of commercial contracts. London: Thorogood.

Samuel, G. (2007). Contract law: Cases and materials. London: Sweet & Maxwell.