Aspects of Contract and Negligence to Business Situations

Task 1

1.1 Essential Elements For Formation of The Contract

A contract is written or express agreement between two parties to provide some specific service or product. An agreement creating obligation enforceable by law. And in the contract law it provide a remedies for the breach of the contract. Contract arise when a duty does or may come into existence, because of a promise made by one of the parties. For the legal binding contract a promise must be exchange for the consideration. The contract law governed by the statutory and the common and the private law (Pozgar, 2011). The formation of valid contract is necessary because otherwise later so much mistake come into contract and than contract will not enforceable by the law.

These are the essential element of the contract-

Offer: An offer or a promise or an agreement needs to be in contract because if there is no offer than there will be no contract. This is the first element of the contract and the whole contract is based on offer made by the parties. Offer make sure that the contract is legally valid and acceptable. The offer can be made for the specific person or to the whole world (Herman, 2011).

Acceptance: This is the second and the important element of the contract. To form a contract to be made there should be acceptance from the other party. When both the parties clear with the offer then they would make an acceptance of the contract. The party can accept the offer being made in writing or orally which is made verbally or being spoken out (Vlot, Gunnink 2011).
Consideration is also a very important element in the contract. Consideration in a contract would mean the other person would be giving back something in return. There must be consideration between the parties in the contract it give a valid enforcement to a contract. It would be consider as an exchange which would be made between the promisee and promissor. In the contract there should be consideration so that it would be legally valid.

Capacity: As per this parties must have the legal capacity to come into the contract. There are some specific person who are restricted to enter into each kind of contract. Person who is below the age of eighteen, prisoner, bankrupt, unsound mind they cannot come into each kind of contract that will not enforce by the law.

Intention to create legal relationship: It is essential to have this element in the contract. It is necessary the contract must have the legal relation to bound (Wills, Napier-Munn, 2015). This element would have an agreement which is not a contract in the strict sense unless it is the common intention of the parties that it should be legally enforceable.

1.2 Types of Contract

There are different different kind of contract to use in different situation so that party can make contract anytime in all situation. The different forms of contract include face to face and distance selling and the situation and circumstances decide which type of contract would be formed. In the contract law there are various type of contract and these are –

Face To Face Contract: these are the contract party can make only when they meet. The contract form when both the parties are present in the same area and can meet to discuss the terms and the condition. As party can get in touch with each other in this contract (Edwards, 2009) .parties enter the written form of contract in which all the clauses and conditions are written and signed by both the parties. These are the contract which are crystal clear contract where parties can decide the condition so in this there are less chances of confusion.

Distance Selling Contract: In case of distance selling, the parties do not get a chance to meet in person or to inspect good, and thus the contracts are formed on the basis of trust and faith. The parties decide the terms in distance. Parties make contract throw email, website or by the phones. These contract are also binding by the law (Bal, et.al., 2008).

Written Contract: these contract are legally enforceable agreement involving an exchange of promises. Most of the are enforceable by the law whether it is written or oral. But in the business relations there are usually written contract and in the business there should be written contract so in this they can look back for the terms and condition. As per the contract law there are several reasons that written contract are better than oral contract. In the written contract all the terms and the condition mention in the contract and that is signed by the parties so as per this parties are bound to perform that conditions (Giannetti, Burkart, Ellingsen, 2011).

As per the given condition of InXs and CP in this they both make a written contract between bot of them . There all the conditions are written down on the document. And both the parties are bound with the terms in the contract.