ASPECTS OF CONTRACT AND NEGLIGENCE

1

Table of Contents

Introduction................................................................................................................................3

LO1: Task 1................................................................................................................................3

1.1 Requirements for the formation of a valid contract.............................................................3

1.2 Identification of the type of contract in the given case........................................................4

2.1 The possible claim of Eddie and Frank on Doris’s vase......................................................4

1.3 Terms in contract with reference to their meaning and effect.............................................4

LO2: Task 2................................................................................................................................6

2.2 Key problems associated with exclusion clauses and role of law in ensuring that it is fair

and reasonable............................................................................................................................6

Impact of the clause on Mix-o-Crete.........................................................................................6

LO3: Task 3................................................................................................................................7

3.1 Nature of general tortious liability.......................................................................................7

3.3 Nature of employer’s liability with reference to vicarious liability and heath safety

implications................................................................................................................................7

LO4: Task 4................................................................................................................................8

3.2 Required factors to prove for bringing a successful claim for negligence...........................8

4.1 And 4.2 Application of the rule of negligence and vicarious law to identify if Asif would

be able to claim for his injury....................................................................................................8

Conclusion..................................................................................................................................9

Reference list............................................................................................................................10

2

Introduction

Contracts can be defined as the lawful agreement between two or more parties that agree to

perform few of the obligations for meeting the requirements of the parties. In this particular

study, the researcher intends to identify terms and practical application of different contracts.

For achieving complete understanding of different contracts, the researcher has performed

four different tasks in which different kinds of contracts are analysed.

LO1: Task 1

1.1 Requirements for the formation of a valid contract

For ensuring the validity of a contract, the following characteristics should be there within the

contract:

Figure 1: Requirements for valid contract

(Source: Chen-Wishart, 2012, p.32)

Specificity has been identified as one of the major factors that need to be there within the

valid contract, that is to say the legal and specific description of the terms, clauses, and

content of the contract need to be included. The considerations are to be clearly stated in the

contract, that is to say the monetary or other kinds of transactions that are made during the

contract are to be mentioned. Before engaging into the contract both the parties need to

examine their capacity of meeting the requirements of the contract. In addition, while

engaging into the contract, the parties need to ensure that the content of the agreement do not

contradict with the English Contract Law and other policies of UK government regarding

terms of contract (Lawson, 2011, p.19). The contracts should be in proper form. In majority

3

Specific contract detailsConsiderations Identification of the capacity of both the parties English Contract LawThe proper form for future conultation

of the cases, written formats are preferred as they provide scope for future references. Yet in

several cases, verbal contracts are also considered acceptable.

1.2 Identification of the type of contract in the given case

Through observation of the given case, the researcher has deduced that unilateral contract is

performed here. When in a contract one party offers an express proposal without securing the

approval from the other party then such kind of contract is identified as the unilateral contract

(Goldberg and Zipursky, 2006, p.1563). The contract transforms into an express contract only

when the offeree agrees to act on the offeros’ promise.

The observed nature of the contract also indicates towards the implied contract, in which

even at the absence of any verbal or written agreement two parties engage into mutual

promise. As in the given case Doris offered the vases on £500 and Eddie agreed to purchase

the vase at the stated price thus the agreement can be implied. On the other hand, after the

bargaining with Frank, Doris offered the vase in £450, and by 12:30 pm, Frank agreed to buy

the vase at that price, which also assumes the mutual agreement and contract. Yet, it is to be

observed that in both the cases Doris has provided no conformity after the offers have been

made. Thus, it is evident that the given contract is of unilateral in nature.

2.1 The possible claim of Eddie and Frank on Doris’s vase

In case of unilateral contracts, no claims can be made by the offerer if the offeree ignores to

accept the proposal. As no instance of Doris, accepting the proposal of any of the offeror has

been observed thus it can be said that none of them have any claim on Doris’s vase.

1.3 Terms in contract with reference to their meaning and effect

Type of term Its significance as part of the contract

Express term These are the terms that are clearly mentioned in the contract and

agreed by both the parties, thus their presence in the contract

defines the nature of the contract along with the responsibilities

of the parties

Implied term These terms are of no less importance as even though these terms

are not directly mentioned in the contract yet without these the

contract does not fulfil certain commercial or legal criteria.

4

Table 1: Significance of different terms in contract

(Source: Gardner, 2011, p.41)

Type of term Actions required if the term is broken Relevant cases

Condition Breach of such terms by one party frees

the other party to be discharged from the

contract

Pousard versus Spiers cases

(1876) 1QBD410

Warranty At the breach of warranties the innocent

party gets to claim damages yet cannot

end the contract

Bettini versus Gye case

(1876) QBD183

Innominate

term

If the innocent party is deprived majorly

then the contract can be ended

Hong King Fir Shipping

versus Kawasaki Kisen

Kaisha case (1962) 2QB26

Table 2: Terms in contract

(Source: e-lawresources.co.uk, 2015)

5

LO2: Task 2

2.2 Key problems associated with exclusion clauses and role of law in ensuring that it is

fair and reasonable

Exclusion clauses are the part of the contract that avails the parties of the contract to limit

their liabilities. Manufacturers or sellers often make use of these clauses for limiting their

liability towards the effect of their product on the consumers or their profitability (Hillman,

2012, p. 43). The major problem that might arise from the exclusion clause is that the party

that has performed the wrong action might be bailed off because of their limited liability

stated in the clause. On the other hand, this also limits the liability of the parties to certain

conditions such as severe damages caused by the accused party to the wronged party.

The Unfair Contract Terms Act (UCTA) is the piece of UK legislation, which is responsible

for ensuring fairness and reasonableness of the exclusion clauses within the contracts

(McKendrick, 2014, p.17). This particular piece of legislation ensures that the responsible

party does not get to withdraw their liability in the following situations:

Death or major personal injury

Breach of the statutory implied terms mentioned in the consumer contract

The UCTA ensures that the manufactures or buyers of the goods do not get opportunity to get

rid of their responsibilities concerning the quality of the products that they avail and the

physical damage that their product might cause to the consumers

(Legalresearch.westlaw.co.uk, 2015).

Impact of the clause on Mix-o-Crete

The cause availed in the contract might be partially applicable as Bob availed his consent to

the clause through signing the contract. thus if the concrete mixer fails to meet the promised

high quality without threatening the life or severe injury to any person then Mix-o-Crete

might rely on this clause, as in such cases the organisation becomes able to avoid its

responsibility through the exclusion clause. Yet if the concrete mixer fails to meet the basic

standards of such products because of which life threatening incidents take place then the

organisation might not rely on the clause as according to UCTA the accused cannot avoid

remedies for death or major personal injury.

6

LO3: Task 3

3.1 Nature of general tortious liability

The nature of tortuous act of an individual or company differs from that of the criminal act as

the tortuous activities involve liabilities that might be met through the lawsuits or financial

compensation while in case of criminal liabilities often the damage cannot be compensated

through mere financial recompense (Brodie, 2007, p.502). In case of tort, the nature of the

liability also differs from that of the contract, as in case of tort the basic aim of compensation

is to place the victim at the position in which the victim could have been if the tort was not

performed. Thus, the tortuous party might be liable to compensate not just the financial

damages but also the other factors that faced issues because of the tortuous activities.

3.3 Nature of employer’s liability with reference to vicarious liability and heath safety

implications

The employer’s liability towards the employee is determined based on the Employers’

Liability (compulsory Insurance) Act 1969 and Employers’ Liability Act 1938. The

Employers’ Liability Act 1938 determines the acceptable and unacceptable behaviour of the

employer within the work place and the treatment that the employer is liable to avail to the

employees. On the other hand, Employers’ Liability (Compulsory Insurance) Act 1969

indicates that employers are responsible for the health and safety of the employees and need

to ensure that the organisational activities do not cause health hazards or injuries to the

employees (Hse.gov.uk, 2015). Thus, the Employers’ Liability Insurance make the employer

responsible for the financial expenses of the treatment of the employees for any injury or

health hazard caused to the employee because of their activities within the work place (Wan,

2011, p.149).

Another significant liability of the employer is vicarious liability, which indicates that the

employer is responsible for the acts or omissions of the employees if the act or omission took

place in the course of the employment. In such cases as the employer has the power to control

the actions of the employees during their servitude, thus the employers are identified as

vicariously responsible for the actions of employees (Baram, 2007, p.15). Under the

respondeat doctrin the harm caused to the victim because of the negligence or omission of

employees makes employers also vicariously liable as the tort is performed during course of

employment (Acas.org.uk, 2015).

7

LO4: Task 4

3.2 Required factors to prove for bringing a successful claim for negligence

For winning the case of negligence, it is essential for the plaintiff to prove the following four

factors that would deduce that the defendant has performed negligence:

Figure 2: Factors to prove for a successful claim for negligence

(Source: Bonell, 2008, p.16)

Firsts the plaintiff through the analysis of the contract needs to establish that the defendant

owes a legal duty toward the plaintiff under the circumstances in which the negligence has

been claimed. Then the plaintiff needs to prove that the defendant has failed to met those

duties because of which the breach took place. Then the plaintiff needs to establish that the

physical injury or the financial damage that took place have been caused because of the

actions or omissions of the defendant (Oswald, 2008, p.256). Finally, the plaintiff needs to

state the damages that have been caused because of the defendant’s actions and their severity.

Through meeting these four factors, that plaintiff might be able to prove the accusations and

make claim for the negligence (Hkclic.org, 2015).

4.1 And 4.2 Application of the rule of negligence and vicarious law to identify if Asif

would be able to claim for his injury

Studying the given case it is well evident that the injury caused to Asif was a result to the

fault of both the parties. Thus in this case not wearing the belt might make Asif face

accusations for the severity of the damages. Yet, due to the laws broken by Jerry while

driving the van, Asif might gain opportunity to claim for the compensation. Jerry drove at the

speed of 50mph in the zone were the highest limit of speed was restricted till 30mph, this

provides Asif an opportunity to state that negligence performed by Jerry has caused the

injuries. On the other hand, Asif might also claim for compensation from the employer of

8

Jerry as jerry was using the company’s vehicle and was on duty of driving for the deliveries

while engaging into the accident. This assigns secondary liability to the owner of the

organisation because of the vicarious liability (Schulte-Nolke, 2007, p.337).

Conclusion

Through conclusion of this study, the researcher has been able to identify the different terms

that are applicable in different kinds of contracts. It has also enabled the researcher to identify

the liability of employers towards the employees and their activities.

9

Reference list

Books:

Chen-Wishart, M. (2012). Contract law. Oxford: Oxford University Press.

Hillman, R. A. (2012). The Richness of Contract Law (Vol. 28). Berlin: Springer Science &

Business Media.

Lawson, R. G. (2011). Exclusion clauses and unfair contract terms. London: Sweet &

Maxwell.

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

Press.

Journals:

Baram, M. (2007). “Liability and its influence on designing for product and process

safety.” Safety Science, 45(1), pp. 11-30.

Bonell, M. J. (2008). “The CISG, European Contract Law and the Development of a World

Contract Law”. The American Journal of Comparative Law, pp. 1-28.

Brodie, D. (2007). “Enterprise liability: justifying vicarious liability”. Oxford Journal of

Legal Studies, 27(3), pp. 493-508.

Gardner, J. (2011). “What is Tort Law For? Part 1. The Place of Corrective Justice”. Law and

Philosophy, 30(1), pp. 1-50.

Goldberg, J. C., and Zipursky, B. C. (2006). “Seeing Tort Law from the Internal Point of

View: Holmes and Hart on Legal Duties”. Fordham Law Review, 75, pp. 1563.

Oswald, L. J. (2008). “International Issues in Secondary Liability for Intellectual Property

Rights Infringement”. American Business Law Journal, 45(2), pp. 247-282.

Schulte-Nolke, H. (2007). “EC Law on the Formation of Contract–from the Common Frame

of Reference to the ‘Blue Button’”. European Review of Contract Law, 3(3), pp. 332-349.

10

Wan, K. S. (2011). “Internet Service Providers' Vicarious Liability Versus Regulation of

Copyright Infringement in China”. Journal of Law, Technology and Policy, 2011(375), p.

149-150.

Websites:

Acas.org.uk, (2015), Understanding what vicarious liability means for employers, available

from: http://www.acas.org.uk/index.aspx?articleid=3715 [Accessed on: 21/10/2015]

E-lawresources.co.uk, (2015), Conditions, warranties and Innominate terms, available from:

http://e-lawresources.co.uk/Conditions,-warranties-and-innominate-terms.php [Accessed on:

21/10/2015]

Hkclic.org, (2015), business And Commerce, available from:

http://www.hkclic.org/en/topics/businessAndCommerce/setting_up_business_in_Hong_Kong

/making_a_business_contract/q1.shtml [Accessed on: 21/10/2015]

Hse.gov.uk, (2015), Employers’ Liability (Compulsory Insurance) Act 1969, available from:

http://www.hse.gov.uk/pubns/hse40.pdf [Accessed on: 21/10/2015]

Legalresearch.westlaw.co.uk, (2015), exclusion clauses unfair contract terms, available from:

http://legalresearch.westlaw.co.uk/books/exclusion-clauses-unfair-contract-terms/ [Accessed

on: 21/10/2015]

11