PART 1
Q (a) Verbal and written contracts
Contract Law of Australia is governed by the common law. There are many independent contracts arrangements that used the verbal contracts that will only work if there are no disputes. An agreement of handshake is still to be a contract and can be enforced by the Court.
Written contracts have been provided more certainty for both the parties than the verbal contracts. They have clearly set out the details that were agreed. The matters such as materials, payments, timeframes and the procedure that has been follow in the event of a dispute that all can be set out in a contract.
The verbal contract and written contracts are both legally binding on the parties. The verbal contract is not as legally binding as the written contract. The verbal contract is difficult to prove whereas the written contract is written and therefore it is becomes easy to prove (FindLawAustralia, 2018).
In Gordon v Macgregor (1909) 8 CLR 316 case, it is a written contract and the Gordan has succeeded the case that was the term of the agreement by the parties that the delivery of grift could not be commenced for the three months. In this, the oral term has also been regarded in the minimum grift of the logs.
Q (b) The essential elements of a valid contract
The elements of a valid contract are:
• Offer and Acceptance
It is an essential element of the contract. The contract cannot be made without an offer has been made by a party to the other party. The acceptance is required when an offer has been made by a party than only the contract will be enforceable.
• Consideration
The consideration is the price that has been paid on the promise made by an party to the another party. The price is not necessary to be in monetary it can be value. Consideration can be an interest, right or the benefit going for the one party or the loss that has been suffered by a party.
• Intention to create legal relations
The agreement between the parties does not create the legal binding contract. The intention of the party is required to enter into a legal binding contract. The law will not considered that what the parties has subjectively intended but it depends on the circumstances the person has reached into the contract.
• Legal Capacity
There are people who are not allowed to enter into a valid contract that involves the people who have the mental impairment, minors, bankrupts, corporations (The person acting on the behalf of the company) and the prisoner (The Law Handbook, 2018).
Q(c) The terms and conditions of a contract
There is not a specific format that a contract must follow. Therefore, that includes some terms either the express or the implied that is the basis of the agreement. These terms have outlined the contract conditions or the contract warranties. Contract conditions are the fundamentals to the agreement and if these conditions are not met than one can seek for the compensation for the damages. Contract warranties are the less important terms and they are fundamentals to the agreement. The contract cannot be terminated if the warranties will not been fulfilled but it may claim the compensation for the damages (Goldberger, 2016).
The contracts follow a structure but it is not limited such as:
• The details of the parties to the contract that also includes the details of the parties to the contract including any sub contract arrangements.
• The duration of the contract
• Description of the key terms that has used within the contract
• Description of the good or the services that the business will provide that includes the key deliverables.
• The payments and date.
• The key dates and the milestones, requires insurance and the indemnity provisions.
• This guarantees provisions that include the director guarantees (FindLawAustralia, 2018).
Q (d) Standard form contracts and unfair terms
It is a pre-prepared contract in that the terms and conditions have been set in advance with a little negotiation or may be not between the parties. The standard form contracts are mostly printed with the blank spaces for the names, dates, signatures etc.
There are some examples of standard form contracts are the employment contracts, insurance agreements, lease agreements and the financial agreements.
These contracts are generally written for the benefitted in the interest of those who is offering the contract. The negation is possible in the terms of the standard form contract. However, in the cases the only option is left is either to take it or leave it (Trebilcock & Leng, 2006).
The terms that are unfair in accordance with the laws
1. The term that has enable one party but restrict the other party to limit or avoid the obligations under the contract
2. The term that has allowed one party but restrict the other party to terminate the contract
3. The terms that will put the penalty on the one party but restrict the other party for terminating or breaching the contract
4. The terms that will enable the party to vary their terms but restrict the other (ACCC, 2018)
In Olley v Marlborough Court Ltd [1949] 1 KB 532 case, the hotel was negligence in the safeguard of the keys of the hotel room as they had breached the contract to provide safety to room and therefore hotel had been held liable for the cost of the stolen items.
In L’Estrange v E. Graucob Ltd [1934] 2 KB 394 case, the excluding clause in the contract held binding on the claimant as the claimant did not read the contract properly did not affect the impact of its validity.
Q (e) The methods of bringing a contract to an end
• The contract can be end by the agreement when both the parties agree to end the contract before the compliance of the contract
• The frustration can be the reason to end the contract when the circumstances are unforeseen that is outside the control of the party
• When the condition of the contract has not been complied by the other party than the party can terminate the contract and ask for the damages or the compensation
• The contract only allows the party to terminate at any time by giving the notice to the other party (Australian Contract Law, 2018)
PART 2
Negligence is the action in that failing to do something as the other person in his place would done that action in that circumstance and that causes the injuries to the other person and that results in the breach and will be liable for the damages. Negligence is an expression of the law of tort. Four questions give rise by which the negligence is determined. Whether the defendant who been sued owe the person who has suffered the injury (plaintiff) a duty of care? Does the defendant have been found to be in a breach of duty of care? Does the defendant have suffered any type of injury? Does the injury happen due to breach of the duty of care?
These are the factors must been satisfied to prove the negligence and this burden lies on the plaintiff. The actions that create negligence for these essentials are required to be present in that are as follows:
• Duty of Care
The first element of the negligence that whether the duty of care has the existence and also will be applied on the neighbourhood principle for example if it would also affect the other person in the same circumstances as the defendant will have the adverse effect on the plaintiff. The same effect will lie on than the duty of care lies by the plaintiff to the defendant. In Donoghue v Stevenson [1932] A.C. 562, [1932] UKHL 100, 1932 S.C. (H.L.) 31, 1932 S.L.T. 317, [1932] W.N. 139 case, in this the tort of negligence was developed. The Donoghue was the plaintiff who has purchased the ginger beer from the Stevens who was the manufacturer of the beer. The beer was in an opaque bottle in that the contents were not clearly visible. Donoghue after consuming some beer she has poured the beer into the glass and she has found the decomposed snail that has remained in the beer. The plaintiff got the gastro-enteritis and the nervous shock that has been claimed by her due to the presence of the snail in the beer. In this case, the defendant owes a duty of care to the plaintiff. Thus, the case applies that whether the Stevenson owes the duty of care to the Donoghue. Thus the liability arise on Donogue to prove the breach of duty by the Stevenson in taking the reasonable care and to show the damages had been caused to her due to the breach. The court has found Stevenson for the breach of duty of care and held liable to pay the damages (Stickley, 2016).
• Breach of Duty of Care
Thus from the first essential if the duty is owed than the next step is to determine whether the defendant has breached the duty. The breach will be considered when the defendant has not followed the minimum standard of care that is required and the reasonable person would have provided standard care in the circumstances that has faced by the defendant. If the answer is yes than the defendant has breached the duty of care. In Vaughan v Menlove (1837) 132 ER 490 Case, the Vaughan who was the plaintiff has made the haystack, Menlove who has occupied the land just near to the Vaughan. The Vaughan argued that he has already warned Menlove that his Haystack can catch fire due to the less ventilation in his haystack. Later the haystack catches the fire. It has been argued that the Vaughan should have taken reasonable care or have taken necessary precautions to prevent the risk. Thus, the court has found that the Vaughan has breached his duty of care and the reasonable person would have done in his place (Harten, Mullan & Promislow, 2015).
• Damages
To determine the damages it is important or required to be the link between the damages that has been suffered by the plaintiff and the breach. The but for test would be applied by the Court in determining that whether the causes are involved in the said negligent act and would there been a contribution of the plaintiff in the duty of care breach. In Accordance with the section 101 of the Malaysia Evidence Act 1950, the actual burden of proof lies for the negligence lies on the plaintiff. However, in some cases it becomes difficult for the plaintiff to prove the negligence than the plaintiff lies on the maxim Res Ispa Loquitor that means the thing speaks for itself. This maxim does not make the defendant liable as the defendant still have the right to rebut the maxim by providing evidence that he acted due to the circumstances. In Nettleship v. Weston (1971) EWCA Civ 6,, 2 QB 691,, 3 WLR 37 case, in this case the defendant had been held liable for the damages. The court said that the person could not took the defence that his driving skill was not as competent to the standards of the competent drivers. Therefore, the court has found him negligent and that creates him liable for the damages.
There are some examples of the actions that is personal injury, false imprisonment, trespass to the person like assault and battery, medical negligence and the harassment. The other examples like trespass to the land by entering, placing or remaining any object and doing interference in the plaintiff’s land. Trespass of the goods of the plaintiff. The other nuisance, vicarious liability, breach of the statuary duty and the occupiers liability (Stickley, 2016).