Do Jane and Dan Have a Binding Contract - Assignment Example

Contract and Negligence Name Course Lecture Date Question 1 (a) : What is Jane situation in relation to Dan? Issue 1: Do Jane and Dan have a binding contract? Law A contract legally binds two parties to undertake their mutually agreed obligation in the contract1. A legally binding contract consists of four elements; offer and acceptance, consideration and intention to create legal relations. An offer is a proposal by the offerer to the offeree expressing his willingness to enter into a binding agreement2. Upon acceptance by the offeree, a legally binding contract is created. However, as seen in Hyde v Wrench (1840), the legal requirements of acceptance assert that acceptance must mirror the offer3. Otherwise if the offeree makes a counter offer the original offer is wiped out. The original offer can only be revived by the offeror. Application In the case, Dan offers to rent his barn to Jane for $2000, this is on condition she leaves a $6000 deposit in case of damage the next fortnight. However, Jane does not agree to this offer and instead promises that she will pay the $6000 in a week’s time. Therefore, Jane’s request to pay the amount in a week is a counter-offer as per Hyde v Wrench (1840) and therefore has the effect of wiping out the original offer4. In the case, Hyde rejected the original offer when he made a counter-offer. Only Wrench, the offeror could revive the original offer. Conclusion Jane and Dan did not have a legally binding contract as it lacked offer and acceptance. Issue 2: Was John obliged to keep the offer open for a week as requested by Jane Law The law does not oblige the offeror to keep the offer open for a specified amount of time unless the offeror gives some consideration for example a deposit. Consideration has the effect of keeping the offer open as seen in Goldsborough Mort & Co Ltd v Quinn)(1910)5. Application When Jane requested Dan to allow her a week to take out a loan for the deposit of $6,000 he expected Dan would keep the offer open for week. Instead, Dan had already rented the Barn to someone else by the time Jane come back to deposit the bond. As seen in Goldsborough Mort & Co Ltd v Quinn)(1910), Dan was not under any obligation to keep the offer open for a week as Jane had not provided any consideration to keep the offer open6. If Jane had given out some consideration it would have meant Dan accepted to keep the offer open for the agreed period. Furthermore, it would mean that Dan had accepted her counter-offer to produce the deposit within a week. Conclusion Dan was within her right to rent out the barn to a third party even before the week ended as he was under no legal obligation to keep the offer open for a week. Issue 3: Should John have communicated revocation of offer to Jane Law An offeror is within his rights to revoke an offer before it has been accepted7. However, this revocation of the offer must be communicated to the offeree. Dickinson v. Dodds (1876) 2 Ch.D. 463 requires an offeror to communicate revocation of offer to offeree8. Hyde v. Wrench (1840) 3 assert that a counter-offer kills the original offer9. Application Dan failed to communicate the fact that he had rented the Barn to another party to Jane. It can be presumed that Dan breached his obligation to communicate revocation of offer as per Dickinson v. Dodds (1876) 2 Ch.D. 46310. However, it can be argued that in the situation that there was no offer made by Dan to Jane. This argument is supported by the fact that Jane’s counter-offer to provide the bond within a week wipes out Dan’s original offer as per Hyde v. Wrench (1840)11. Conclusion Dan is not under obligation to communicate his intention to rent the Barn to another party, as presently he has no offer open to Jane. Question 1 (b) What is Jane situation in relation to Dan? The Law For there to be a legally binding contract there must be an offer and an acceptance. The acceptance must mirror the offer; Hyde v. Wrench (1840) 3 Beav 334 rules that the offeree must accept the offer as it is for it to be considered a contract12. Application When Jane contacted DiscoJohn she asked his brother to provide entertainment for her party for $1000 which she would pay on the night. John did not make a counter offer and accepted the offer exactly as it was made. Therefore, John acceptance conforms to the mirror rule espoused in Hyde v. Wrench (1840) 3 Beav 334 which states that the offeree should accept the offer as it is and not seek any modifications13. Conclusion John and Jane have a legally binding contract and thus Jane is required to pay John $1000 even though she cancelled her party. Question 2: What claim if any can be made against Max for the poor sanitation and production of the beers. Issue 1: Does max owe a duty of care to Jackie and Phillip Law: The test to be used in this case is the neighbour test. A manufacture who packs a product and intends it to be used by a consumer as he packed it must take reasonable care to ensure the product does not harm the consumer. This is especially so if there is no reasonable possibility the consumer will examine the product. Thus the manufacturer owes the consumer a duty of care; : Donoghue v Stevenson [1932] AC 56214. If a person can reasonably foresee that carelessness on his part is likely to cause another party harm, then he owes this other person a duty of care; Authority: Grant v Australian Knitting Mills (1933)15. Application When max was packing the Brew U finest beer he ought to have observed hygiene standards. When the Jackie and Phillip consumed the beer he had produced they were not in a position to examine the contents of the beer. Furthermore, someone who is taking bottled beer does not have the means to find out if the beer has been hygienically produced. As argued in Donoghue v Stevenson [1932] AC 562 the responsibility of ensuring the bear does not harm its consumers falls on Max the producer16. Similarly, Max could reasonably foresee that failing to observe hygienic standard could cause harm to the consumers of the beer. Therefore, as held in Grant v Australian Knitting Mills (1933), Max owed a duty of care to those who could be harmed by his action17. Conclusion Max ought to have taken reasonable care to ensure the beer was hygienically produced. Issue 2: has Max breached his duty of care to Jackie and Phillip Law: the test for breach is concerned with how a reasonable person would have acted in similar circumstances. • What was the magnitude of the risk test; Likelihood of the occurrence; Bolton v Stone [1951] AC 85018. Seriousness of the injury; Paris v Stepney Borough Council [1951] AC 36719. • Defendant fell below established standards of care; Scott v London & St Katherine's Docks (1865) 3 H & C20. Application Manufacturers of beer are required to conform to specified hygiene standards which Max did not adhere too. Secondly, it is likely beer will harm its consumers if hygiene is not observed during production. The seriousness of the injury to Jackie and Phillip is shown by the fact that the two have to be admitted to hospital due to food poisoning. Conclusion Max breached his duty of care to Jackie and Phillip Issue 3: Is there a causation link between Max’s breach of his duty of Care to Jackie and Phillip and the damage suffered by the two? Law: The damage suffered by the plaintiff must be recoverable to be considered in court. A causation link requires the plaintiff to show: a) Causation in fact The damage suffered by the plaintiff must be actually caused by the plaintiff’s negligent conduct. The “But for’ espoused in Barnett v Chelsea & Kensington Hospital Management Committee [1968] 1 All ER 1068 may be used to establish this link21. b) Causation in Law The defendant can only be liable for the damages that are reasonably foreseeable consequence of his negligent action; Overseas Tankship (UK) Ltd v Morts Dock & Engineering Co Ltd [1961] AC 388. Wagon Mound (No 1))22. Application The food poisoning that both Jackie and Phillip suffered is a direct consequence of Max’s failure to observe hygiene while producing the beers. It can be observed; ‘but for John’s failure to observe hygiene during production of the beer, Jackie and Phillip could not have suffered food poisoning’23. On the other hand, Jackie and Phillip’s resultant failure to sit for their FBL exam which consequently means they cannot get the jobs they had been guaranteed at an accounting firm could not have been foreseen by Max. These consequences are too far-fetched consequences of Max’s negligent conduct. Conclusion Max is liable only for the food poisoning damage suffered by Jackie and Phillip, but not for the missed opportunity of sitting the FBL exam and the consequent failure of Jackie and Phillip to secure the promised jobs. Bibliography A. Articles/Books/Reports Treitel, Guenter Heinz, and Edwin Peel. The law of contract. Vol. 10. Londres: Sweet & Maxwell, 1995. B. Cases Barnett v Chelsea & Kensington Hospital Management Committee [1968] 1 All ER 1068 Bolton v Stone [1951] AC 850 Dickinson v. Dodds (1876) 2 Ch.D. 463 Donoghue v Stevenson [1932] AC 562 Goldsbrough, Mort & Co Ltd v Quinn [1910] HCA 20; (1910) Grant v The Australian Knitting Mills ([1936] A.C. 562) Hyde v Wrench [1840] EWHC Ch J90 Overseas Tankship (UK) Ltd v Morts Dock & Engineering Co Ltd [1961] AC 388. Wagon Mound (No 1)). Paris v Stepney Borough Council [1951] AC 367 Scott v London & St Katherine's Docks (1865) 3 H & C Read More