Assignment:
Aspect of Contract and Negligence in Business
Contents
The
contract law and liability in negligence law is very essential in business
organizational casualties. The context below will discuss different terms of
contract and its effect in business scenarios. Application of different
elements of counteract, evaluation of elements of contract, application of law
on terms of contract, definition of different types of contract and analysis of
express term and implied term will be discussed
in the context. Liability in tort, nature of liability in negligence and
vicariously liability and its effect in the eye of law also are discussed in
the subsequent pages.
1.1. Explanation of the importance of the essential elements for any agreement between Essential IT support and its customers
Contracts
referred to an official agreement in the form of oral or agreement. According
to Tritely (2012) contract is “A
promise or set of promises which the law will enforce”. There are some elements
in a valid contract and their importance is described in below:
Agreement: an agreement is formed when one
party accepts the offer made by the other one and involves a meeting of the
minds. In other sense, in an agreement there must have an offer and against it
an acceptance. Unless there is no formal offer and acceptance between Essential
IT support and customers, the agreement will not be considered as valid
contract.
Consideration: It also a very urgent element in
a contract to be valid. There must have a consideration between promise and
promissory and it would be mean that the other person would give something in
return. Essential IT support may ask for a particular charge as consideration
that the customers will pay. In return, Essential IT support will render them
service.
Intention to create legal relation: it is essential to have the
element in a contract to be valid. Though the Contract Act 1950 is silent in this regard, the parties in a
contract must have intended their agreement to have legal consequences. There
should be intention between Essential IT support and its customers to build a
legal contract unless it will not get any validity.
Consent: it is very important and
essential for a valid contract to have a free consent of the both parties. They
must agree on something is the same time at same sense. There has to be free
consent between Essential IT support and its customers. There should be no
enforcement and pressure from any party.
Legality: the purpose of the agreement
must not be illegal or contrary to a public policy to be a contract valid. If
Essential IT support contracts to approach for any illegal performance or
achievement that is also banned by the local laws, the contract will be void (Tritely, 2012).
There are
different forms of contact based on action of contract and based on number of parties.
Types of contract and their impact are discussed below:
Contract by deed: contract by deed refers to the
contract that is completed with a formal legal document signed, witnessed and
delivered to effect conveyance or transfer of property or to create a legal
obligation. Whenever any product is sold or service is provided, Essential IT
support gives them a voucher where both parties put their sign. If the
customers face any problem after their services, they can ask for compensation
following the stated conditions (Atiyah,
2000).
Simple contract: the contract which is not in
deed is known as simple contract. This type of contract is made in any
different way of deed contract such as in writing, orally or may be implied
from conduct. It is not reliable and dependable like contract by deed but this
contract is law enforceable. So, if the customers are familiar to Essential IT
support and its sales people, then the simple contract will be suitable.
Bilateral contact: it is the contract in which a
promise by one party is exchanged for promise by the other. It is the basic
form of contract and most of the contract fall into this category. Under the
contract, Essential IT support fixes, when the products will be delivered, when
the customs will pay, how the charge will be etc. (Hofstra, 2012).
A
contract consists of various terms and that is express term and implied term.
The meaning and effect of both terms are likely below:
Express term
Meaning Express term: it is an open agreement between
an offered and receiver. The express term of a contract can be performed in a
written paper or via an electric writing way or telling or verbalization (Clarck , 2012).
Effects of Express Term: the effect of express term of a
valid contract is essential and deep. By virtue of express term in a contract neither
Essential IT support nor its customers can escape from the obligation, or can’t
do anything illegal. It is also not possible to avail the positive result of
the contract toward one’s own side by any unfair means. In a single word the
effect of express term in a contact is that it makes a contract valid and
longer lasting.
Implied term
Meaning of Implied term: sometimes the terms of a contact
are not mentioned by either any of the parties and not included in the contract
cause of not making the contract by commercial sense without that term. Rather
here terms are implied by courts or statutes. Implied terms are the word or
provisions that a court assumes were intended to be included in a contract.
Condition, warranty and nominate terms are included in implied term.
Effects of Implied terms: In applied terms there can be a
condition, a warranty and in nominate terms. If any party whether Essential IT
support or its customers breach any condition, the suffered party has the right
to sue the wrongdoer for the damage. If a warranty has been breached the
suffered party can sue but cannot terminate the contract to return to their pre
contractual position (Hare, 2012). That
is why; this sort of contractual term is not popular in the modern business
world.
Hofstra (2012) refers that the elements of contact
must be performed for the valediction of a contract. There are some rules and
regulations in this regard. The applications of the elements of contract in
given scenarios are in subsequent phases.
Offer and acceptance: There has to be a party who will
offer and the other who will accept it. Essential IT support may offer their
services to the customers for a particular charge. Here, Essential IT support
is offeree and the customers are offeror. If the offer is accepted, it will
make its way to contract.
Capacity: it refers to the legal capacity
of the parties to enter into a contract. Insane and fewer than 18 year old
people are not eligible to make a contact. Essential IT support has to make
contract with an adult whose age is above 18. Besides, Essential IT support has
to make it clear that their customers are not mentally sick or else. Otherwise
the clients will not have legal right to ask for claim if anything wrong
happens with him.
Possibility of performance: If the agreement is made on such
objectives that are never possible to achieve, it will not assumed as contract.
So, Essential IT support has to make contract on those projects that are
possible to execute and accomplished.
Lawful objectives: Lawful objectives are sort of
considerations. There are some rules that Essential IT support can follow in their contract such as
no forbidden products or services will be supplied, never become fraud, do not
get involved with immoral policies etc. (Atiyah,
2000).
According
to Hugh (2013) the contract are
normally governed and enforced by different laws of contract such as Sales of
Goods Act 1979, Supply of goods and Services Act 1982. The applications of laws
on terms of contract are likely below:
On a condition: in the scenario of Essential IT support, singer worker
were failed to appear on time for why the defendant refused to continue the
contract. In this scenario a breach of condition will entitle defendant to
repudiate the contract and claim the damages. Obligation to perform from the
first night was a condition.
On warranty: in scenario of Essential IT support worker were failed
to come in due time on the purpose of rehearsals for his illness as a result
Gye the defendant refused to accept his services. In this situation defendant
cannot repudiate the contract as warranty is a less important term.
Intermediate terms: in this terms it is impossible
to classify neatly either it is warranty or condition. An intermediate position
can be addressed only in light of consequences of breach. In this if the damage
is severe the injured party can repudiate the contract. On the other hand if it
not severe the injured parties’ remedies will be restricted to damages.
Clark (2003) refers that a contract has many
terms with different effects on a contract. A valid contact cannot be without
its terms and formalities. Evaluation of the effects on different terms of
contract is in below:
Condition: it is a vital term of making a
contract. A breach of condition makes the injured party able to repudiate the
contract. Both the party has to read out and clearly define the conditions
whenever signing the contractual paper. Since manager of Sunderland University
skipped the part, they have to suffer here.
Warranty: Warranty is an implied part for
every contractual agreement. Generally, all customers enjoy the warranty
facility by suppliers. But here, in the signing paper, it was clearly defined
that the implied terms are excluded. So, Essential IT support is not bound to
provide warranty to Sunderland University.
Exclusion clauses: in this term the wrong doer is
excluded from the responsibility of punishment or sometime not for the excluded
condition breaching. If the clause does not exclude liability for breach of a
condition the plaintiff was not bound by it.
Expressed term: It was lawfully a valid
contract. The contract was made on the IT related products and services that
are effective for educational institutions. Besides, the implied terms are
excluded has also been described here. So, there is nothing wrong against the
contract.
Implied terms: in most contracts the primary
obligation of the parties are not expressed terms. But since, Essential IT
support has mentioned that they will not be responsible for the implied terms, Sunderland
University cannot ask for any legal claim (Hugh,
2013).
According
to Marsh (2011) the term tort refers
to the damage, harm or injury to the other counterpart or company with which he
wears engaged in a contract. And tortuous liability arises from the breach of a
duty fixed by laws. In tort liability the breached are responsible to
compensate the damage of injured party. On the other hand contract is an
agreement between two or more persons, parties or clients outlining their
duties to one another. In contractual liability the compensation terms are
quoted or narrated hare.
Sometimes
the contract liability law and tort law are categorizes into the law of
obligation. There are some similarities between tort and contract. Such as
contract and tort create civil law obligation and breach of both provide the
opportunity to an action for damages. On the other side there are some
differences too such as contractual obligations are voluntarily undertaken but
in regard of law of tort there is no free choice law imposes the obligation. In
tort liability the tort is obliged to compensate the damage as it were before
but in contractual liability damages are counted as the agreement shows (Brazier, 1993).
3.2. Explanation of importance of duty of care, breach of duty and damages for establishing a negligence liability
Clarendon, (2010) refers that liability means the
obligation and responsibility to make up the damages or compensation for damages
or violation of contract law. In business more or two parties involve in a
contract to do something, if any of two or them breach the pint of contract he
will be obliged to compensate the damage for his negligence. The liability in
negligence refers that what will be the liability and how to fill the damage if
one damages another’s things for negligence.
Duty of care: the duty of care responsibility
held’s by company to provide protection for the employees. It makes a relation
between two parties involved in contract. Duty of care is a condition in
contract and its breach makes the tort responsible to compensate the damages.
Duty of care can help Essential IT support to understand from whom from which
corner of the organization, dangers may arise.
Breach of duty: it is the second element in
negligence. A breach of duty of care refers to the falling below the standard
of behavior that was expected. In the breach of duty of care the defendant’s
activities are tested against the standard of care expected of responsible
person. Essential IT support can understand the reasons employees of the
organization have been failed to carry out their duties. It can help them to be
careful in future.
Damages for negligence: it is the third stage of
negligence. It can Essential IT support to know how much lost causes to the
plaintiff for the negligence of a defendant. If there is a quote in contract
about the compensation limitation or type that type will be liable for the
defendant (Elliot, 2003).
In contract
system vicarious contract may occurred in different time or situation. In
vicarious liability another person become liable because of having relationship
with the person who did the act negligently. The name of this negligence is
imputed negligence.
In a
vicarious contract, there are various things such as bartered exchange,
subscription fee or advertizing revenue of copyright. One person may be
reliable if he is not aware enough of the knowledge of inferring acts occurring
in the business. The employer will be charged with legal responsibility for the
negligence for employee as he is the agent of the employer. As for example, in
a business restaurant if the worker causes damage negligently to the customer
in his duty time the employee of the worker will be responsible for the damage
because of agency (Elliot, 2003).
Essential
IT support has been delivering their products and services in time to their
customers. If for any particular reasons, due to their employees, Essential IT
support becomes failed to reach their products to customers, the employees will
be considered as vicariously liable.
At the
very end we can say that there are many contract system some have great
importance than the others. The factors of different terms of contract and
their effect according to law is necessary to know for the businessmen and
company. In business the company or proprietors have to conduct many contracts
with customers and clients with some condition. So what will be the effect if a
condition or warrant is breach by the company are necessary to know. The
context will help them all providing a clear concept and regulation of law in
business industries.
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