A contract is a valid agreement or legally binding between 2 different parties. Moreover it is a written or spoken agreement, especially one concerning employment, sales, or tenancy, that is intended to be enforceable by law. There are many purposes of a contract but one main purpose is to ensure that the agreement is established which is made by the both of the parties and to ensure the duties and rights are fixed according to the agreement made. Valid contracts are enforceable in court. However if the agreement contains all of the following elements then it is considered as a valid contract.
3) invitation to treat
These are the distinctive sorts of agreement, every one of these sorts are written, verbal and standard form. Spoken words is a verbal contract and is a less formal route for instance a man purchasing an auto from their companion. A written contract is a more formal method for making an agreement that includes at least 2 parties. A case of a written contract are cell phone contracts or a mortgage from a bank obtaining a house. The third and last sort is standard frame. This is a sort of agreement where the terms can’t be changed, a case of this is the terms and conditions that may come when purchasing items on the internet.
Invitation to treat
This can be defined as an expression of a willingness to negotiate. However An invitation treat demonstrates that it may be interested in receive an offer which isn’t legally binding until the point when it is acknowledged.There are numerous cases of invitation to treat and these include things, for example, products and goods that are placed in shops windows or even a catalogue book from argos and the company prospects when the shares are being sold as the owner of the company/business can either accept or reject any offer made by an investor that they have placed.
The Carlill V Carbolic Smoke Ball Co is an example of case law that relates to an invitation to treat.This is a case where an advert was made by Carbolic which informed the audience that anyone with a flew would be rewarded with a fee of £100 the flu was cured after they had used the smoke balls.Mrs Cahill had followed the direction of use after she had purchased the smoke ball, however Mrs Cahill had possessed the flu and had attempt to claim £100 but Carbolic had refused the claim due to the fact that a serious contract was not possessed. The Formation of contract had no issue, therefore it was a valid contract. The significance of this case is the £100 that was promoted by the business itself as this was an invitation to treat.
Communication of offers.
This alludes to an offer that is should have been communicated between the party, this is on the grounds that it will pick up acknowledgment to have the acceptance to shape a valid contract. Therefore the communications between the 2 parties must be clear. Written letters, handshakes, verbal spoken agreements,texts and emails are all prime examples of how offers can be communicate amongst the 2 parties. If an offer is sent in the post it will have no effect until it reaches the other party- that is to say when it is communicated not when the offer letter is posted. In Taylor v Laird (1856) the captain of a ship resigned during a voyage. The ex captain had given navigation services for the remainder journey of the voyage, however this wants requested by the shipowner. For this reason the ex captain r claimed in the courts for proper remuneration for his services from the owner. The captain had not communicated his offer to provide such services. As such the owner did not have the opportunity to refuse or accept the offer as he had no knowledge of its existence. There was no binding contract.
This is needed to form a valid contract, it is an element of a contract. Acceptance is occurred when a party has accepted the other party offer , for this reason consents to commonly bound to the terms of the agreement by giving consideration , for example, cashIn simple words, acceptance is simply the offeree accepting an offer with its terms and conditions. The acceptance must be clear in order for the both parties to go into contract, moreover it must be performed with 100% intention of accepting the offer.
Can silence amount to acceptance? Not according to the decision in Felthouse v Bindley(1863).
Paul Felthouse was a builder who lived in London. He wanted to buy a horse from his nephew, John Felthouse. The matter of the sale of the horse was discussed and the nephew sent a letter to his uncle After a letter from the nephew concerning a discussion about buying the horse, the uncle replied saying,’If I hear no more about him, I consider the horse mine at £30 and 15 shillings. However there was no reply from the nephew after he was busy at a auction on a farm. . He told the man running the auctions, William Bindley, not to sell the horse. But by accident, Bindley did. This lead to the uncle suing Bindley and it led to the issue coming down to the question of whether Felthouse could prove that a valid contract was made. Brindley’s argument was that there was not a contract as further communication was not made about the acceptance of the claimants offer, therefore the court agreed there was no contract.