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Sample on Aspects of Contract and Negligence in Business

Introduction to Contract and Negligence in Business

This report is all about contract and its usage. How to deal with a contract, elements of contract, what can be done in case of negligence, vicarious liability, elements of negligence is briefly discussed in this report. This report is based on the analysis made out of four case studies as given in the question. All the case laws are studied well and then the findings related to the respective case laws are discussed in this report. In this report all the cases given deals about different aspects of contract and negligence in business (What Is Negligence and How Do I Defend against a Negligence Claim? 2014). It has discussed the elements, nature, and type of contract. Here the case describes about how contract and mere carelessness can affect the parties involved.

It is stated in the cases that how non reading of contract can cause trouble for the parties and how can we get over it. This report explains about the options available in law in case of misrepresentation and what are the provisions which protect the persons in the contract. All the measures the plaintiff can take in case of fraud, misrepresentation, or any undue influence. This report gives a brief idea about how to deal a contract and what a contact actually is.

All the contracts are based on some main elements and they are to be fulfilled to complete the contract and bind it legally. Main elements of a contract are Agreement, Offer narrates willingness, Acceptance which is unconditional adoption of the agreement offered. Contract is also based on consideration and it is presumed that it contains the elements of legality. Contract can be in any form simple written or any deed. Every agreement is a valid contract and its validity can be challenged due to several factors such as misrepresentation, it makes the contract voidable and can be accessed future only if the acceptor wishes. Mistakes make the contract void and cannot be accessed; duress and undue influence make the contract voidable. If the contact consists of any illegal issues then the contract is considered void (Occupiers Liability. n.d).

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In the given situation advertisement given by “XP Word” will be considered as unilateral offer by them which can be accepted by any one. On the basis of advertisement James wait outside the shop for whole night to avail the offer given by “XP Word”.  In the morning “XP Word” deny to perform by saying to James that you should be sensible enough to not to rely on such kind of advertisement

This is a clear case of misrepresentation as the company just in order to increase their profits cannot misguide the public and are not allowed to publish such fake advertisements (Defences to Negligence. 2014). Customers are the liability of business and misguiding them or cheating them is considered to be unethical and is against the law and thus in this case James has the right against the company as the offer is voidable he can file a suit against XP Word for publishing such misguiding and fake advertisements (Negligence. 2014).

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An offer is a statement showing willingness. Any statement which is definite and capable of being accepted by offeree is considered as offer. An offer may be implied or express, may be made to a single person, group or the entire world. It is communicated well and effectively then it is an offer. In the above case company gave a statement which was effectively communicated and was capable of being accepted and hence was offer and XP World cannot deny on this fact (Weiss, 2003).

In the above case James understood the option accepted it and communicated well his intentions hence, the acceptance was made. Thus this was a contact between XP world and James. And thus in the given case study James has full right to take legal action against the company for misrepresenting the facts and giving wrong information to public (Zoll, 2012). James can file a suit against the company relating to fraud and misrepresentation. In this case it is presumed that the parties are intended to get into the legal aspects of the contract unless stated otherwise. “XP Word” has given unilateral offer which was accepted by James has their legal obligation on the parties to give performance. “XP Word” cannot deny doing so.

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In order to make a valid contract parties to a contract must fulfil all the essentials which are required to form a valid contract. As per the case scenario XP world had made advertisement in the newspaper in relation to selling of computers. On the basis of this aspect, XP world had made offer to the general public at large. Thus, it is recognized as unilateral kind of offer in which one party make promise to another without taking consent of him. By going through such advertisement James had made decision about the purchasing of computer for £ 2.00. James was from one of the five customers who expressed their feelings in relation to the purchase of computers.

Thus, there is both offer and acceptance are available so it is considered as a contract. Besides this, on the basis of unilateral offer XP world has the obligation to fulfil the promise which is made by him. In addition to this, consideration is also present in this contract in terms of money such as £2.00. Along with it, both the parties having the intention to create the legal obligation. Offer and acceptance clearly reflects such aspects. Thus, all the essentials are present in the contract so it is termed as a valid contract. Thus, James has the right to make sue upon XP world for the computer. Further, as per the laws and legislation XP wold is also held liable to perform the promise which is made by him.

There are different types of contracts such as

  • Implied contract: These types of contract are those contracts which are not accepted by written or spoken words. It is assumed on the circumstances and conditions. These contracts are created by code of conduct or expression of parties. It is also known as Tactic contract.
  • Express contract: These are said in written or by way of words. These are more specific and create legal binding for the contract. For example contract of sale of property, lease deed, induction document etc.
  • Executed contract: Under this type both the parties have performed their respective task related to agreement made. Such contracts are completed as there is no remaining obligation of parties.
  • Executory contract: Under this type the parties are still to perform their obligations. Such contracts are uncompleted contract in partial performance is provided. In this parties are still liable to perform their duty. They are required to give satisfactory performance by fulfilling terms of the contract.
  • Partly Executed Contract: Under this any one party have performed their part of task. These contracts are part of the executory contract.
  • Unilateral Contracts: it is a one sided contract and thus only one party is liable to perform this type of contract. These offers are in general which can be accepted by anyone. In this there is single promise rather than exchange of promises between the parties. In unilateral contracts second party is obliged for performance, it is optional for them.
  • Bilateral Contract: Under this type both the parties have to fulfil their part of the obligation or contract such contracts are made by exchange of promises. In this both parties are obliged to give performance else they can be sued for breach of contract and required to pay damages to aggrieved party.
  • Valid Contracts: these are the contracts which are enforceable by law. In this all the essential elements of contracts are present. Agreements which are able to create legal binding for parties are considered as valid contract.
  • Void Agreement: This type of contract is void- ab- initio hence cannot be performed at any cost. Such agreements are restricted by law to perform. In the situation of breach of contract there is no legal liability permissible. Along with this both parties will obliged to face legal penalty to do actions which are contradictory to law.
  • Voidable: these agreements can be enforceable only at the option of the aggrieved party. If contract are create by misrepresentation, mistake, coercion, undue influence then such contracts are voidable at the option of innocent party. If aggrieved party chooses to terminate the contract than it will be converted in void contract.
  • Illegal contracts: This type of contracts can never be enforced. In such contract objective is contradict to law or against the public policy. For example contracts of murder, sexual assault etc.
  • Unenforceable: These contracts are valid but are not enforceable due to any technical fault. For example contract with bilateral mistake.

In the given situation there is unilateral contract between the parties. Offer given through the advertisement was general offer which can be accepted by anyone. If performance is given by other party then it will obliged primary party to give performance.

Thus these are the contracts which are applicable at different agreements with different aspects. Contracts bind the parties to perform their part of contract and unless it is not performed duly the contract is not considered to be accomplished. The contract act is specially designed by the government in different countries. This act is applicable to duly regulate all the agreement proceedings done by the companies.

If a contract is signed it is presumed that the contract must be read by the persons signing it. This comes under doctrine of indoor management. Every buyer before getting into any contract must read the contract before signing it.

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In the given case Peter is buyer who wishes to purchase a new I pad and had a little information about it (Abdullah, 2010).  He went to the XP World and after having a few words with him decided to buy the product on a 24 month contract basis. Assistant of the shop tells him that it was a standard contract and thus Peter sign the contract without reading it. When he reached back home he found that the product was not working properly and after contacting the shop back its assistance said that it was clearly mentioned in the contract that the product will not be replaced and the repair cost will be beard by the customer himself. In spite of faulty product whole amount must be paid by the person (Hall, 2003).

This was the duty of the buyer to read the contract before signing it even if it was a standard contract. He cannot sign a contract on presumption basis. Thus his presumption about the agreement bound Peter and the HX World in a contract.

Sale of goods act clearly states that no seller can add any clause which exploits the customer. Further the contract also mentions that it is the responsibility of the seller to replace or repair the faulty product. The buyer is not liable to bear the cost of repairs and the concern cannot add any such clause in the contract (Wishart 2012).

Thus in the given case law, XP World has added certain conditions which are against the Sale of Goods act and cannot be added by the concern and hence Peter being the buyer who is suffering loss and being exploited can file a suit against XP World in reference to the Sale of Goods act to the court and can get a valid judgement in this respect (Kuney, 2011).

 In order to protect the customers from the malpractices of business Consumer Protect Act comes into consideration. It entails several rights of the consumer which they possess in relation to the purchase of goods or services. Customer has the right to get all the information about the product or service which they going to purchase. On the basis of the case scenario, Peter possesses the right to get information about all the clauses which are mentioned by XP world in the oral form. In addition to this, he also has the right to get information about the replacement and repair of I pad. In the present case, XP world had not informed to Peter about the terms of condition and warranty in oral form. He directly added clause in the standard form which is considered act undesirable act.


From the present project report it can be concluded that contract is legal agreement which contains four major elements that are offer, acceptance, legal intentions and consideration. Present project report gives a brief description about contract and tort law. Tort liability arises in the absence of contractual relationship. According to occupier’s liability act and vicarious liability business will be held liable for the negligent act of employees. Thus they should provide safe and secure working environment and take care of act of their employees. For such act defences are provided to business such as contributory negligence, Inevitable Accidents, Volenti-non Fit injuria etc.

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