Understand the Legal Requirements for a Valid Contract
Assignment 1 – Understanding the legal requirements for a valid contract
The essential elements for a contract, who apply in all cases, are:
1. Offer- made by offeror to the offeree , it is very important to distinguish this from invitation to treat ( which invites offers to be made) 2. Acceptance – Offeree accepts the offer that has been made. Rolls Royce Car 3. Consideration- Something of value passes between the two parties e.g.: A B Bag of Marbles 4. Intention to create legal relations – Domestic/ social agreement: not legally binding Commercial Agreement – legally binding 5. Capacity- Parties must be able to enter into a contract e.g. under 18, Mental Disorder, Alcoholics
Vitiating Factors – these factors could effect the validity of the contract. They make the contract VOID(contract has no legal impact and it will never exist) or VOIDABLE ( contract is valid up to the point at which is set aside).
1. Mistake- VOID e.g. the parties were at cross purposes about the subject matter of the contract. 2. Misrepresentation- VOIDABLE e.g. false statement of fact about an item ( fraudulent, negligent , innocent) 3. Duress- VOIDABLE e.g. Threat of violence or economic threat 4. Under Influence- VOIDABLE e.g. someone has influenced another to enter a contract no in their best interest.
Task 1
On 1st July Vicky advertised her car for sale in the magazine Car Mart.
The advertisement read as follows:
For Sale 1992 Morgan Countryman. Offers around £10,000. Write to PO Box 100, Car Mart Magazine.
On 2nd July Elliot posts a letter to the address in the advertisement in which he states
The essential elements for a contract, who apply in all cases, are:
1. Offer- made by offeror to the offeree , it is very important to distinguish this from invitation to treat ( which invites offers to be made) 2. Acceptance – Offeree accepts the offer that has been made. Rolls Royce Car 3. Consideration- Something of value passes between the two parties e.g.: A B Bag of Marbles 4. Intention to create legal relations – Domestic/ social agreement: not legally binding Commercial Agreement – legally binding 5. Capacity- Parties must be able to enter into a contract e.g. under 18, Mental Disorder, Alcoholics
Vitiating Factors – these factors could effect the validity of the contract. They make the contract VOID(contract has no legal impact and it will never exist) or VOIDABLE ( contract is valid up to the point at which is set aside).
1. Mistake- VOID e.g. the parties were at cross purposes about the subject matter of the contract. 2. Misrepresentation- VOIDABLE e.g. false statement of fact about an item ( fraudulent, negligent , innocent) 3. Duress- VOIDABLE e.g. Threat of violence or economic threat 4. Under Influence- VOIDABLE e.g. someone has influenced another to enter a contract no in their best interest.
Task 1
On 1st July Vicky advertised her car for sale in the magazine Car Mart.
The advertisement read as follows:
For Sale 1992 Morgan Countryman. Offers around £10,000. Write to PO Box 100, Car Mart Magazine.
On 2nd July Elliot posts a letter to the address in the advertisement in which he states