Laws of Contract

Discuss about the Laws of Contract.

Overview of Case

As per first case, Richard was a student of the university. His father enters into an agreement with Richard in which Richard gives his agreement that he will manage and keep gardens tidy.  Against his agreement, Richard’ father says that he will pay $200 weekly to him as an allowance. After four weeks, father of Richard tells him that he will not pay $200 a week because it is the responsibility of Richard to manage the property because he is also a member of the family. 

Issues in the Cass

The case defines that Richard works to maintain the garden of his house as per the agreement with his father. After sometime, Richard’s father canceled the payment contract on the basis of Richard’s obligation towards family and family oriented properties. It means Richard has an obligation to manage and maintain the garden of the house without getting any payment. On the basis of this, followings are some issues that are related to this case:

• Is there an enforceable contract between Richard and his father?
• Do the terms of contract bind Richard’s fathers to pay him?
• Can Richard ask for compensation against his damage?

Rules

For making an enforceable contract, followings are some important elements that should have to use by both parties:

• There should be an offer, which have to given by offeror to offeree;
• There should be an acceptable acceptance from offeree to offeror either in written or oral form (McKendrick & Liu 2015);
• There should be an intention for making law enforceable contract and;
• There should be a commitment or consideration.

If all above elements are available between two or more parties; then both parties will be liable to perform the actions as per the terms of contract.

Applications

Gordon v Macgregor

After the hearing in this case, the court held that the fully written contract can help the defender and plaintiff to get the protection against each other. Otherwise, the oral contract cannot be used by the plaintiff in deciding the liabilities of defender because oral contract will not give any proof to court (Julie Clarke 2010). On the other hand, the court held that oral contract could be applied in some cases but a written contract will be applied in every case because the written contract shows the contents of involved parties. On the basis of this, there was an oral agreement between Richard and his father. Richard has not entered into a written contract with his father. Therefore, ha cannot set the liabilities of his father.

Pelly v Nolan

This case is related to the loan agreement between father and son. In this case, a father gives a loan to his son to provide support for his son for buying a property. After this, the father pays another loan to his son to purchase new property. But the son does not pay any loan amount and not pay the loan interest to this father, although the father has prepared a loan agreement (Lynn & Brown Lawyers 2016).  Therefore the court held that the son was sentenced to pay the whole amount.

Maddock v Anor

It is another case related to the relationship between father and son. In this case, the father of a son paid $240,000 to other parties for the cost of building and purchasing a house. This contract was made between son and other parties. After the hearing, the court held that the there were no formality terms, no term related to repayment, and no demand to repay the loan amount (Familylawexpress.com 2011). On the other hand, if both parties such as father and son have not separated under family laws, then the father cannot ask for the funds’ repayment from his son. As per this decision, it can be stated that Richard and his father were not divided. Therefore, Richard may not ask for the breach of contract until the separation of the family under the section 60CA of the Family Law Act 1975.

Brambles Holding Ltd v Bathurst City Council:

This is another case related to the contract. In this case, the court held that if there is an offer and acceptance and both parties are willing to sign a contract, then a law enforceable contract will take place between the parties. And every party has the right to get the remedies against other parties during the breach of contract (Gibson & Fraser 2013, p. 336). On the basis of this case, it can be stated that there was a reliable offer and acceptance between Richard and his father but there was no consideration to make an enforceable contract and both parties have not shown their intension to make a legal contract.

Conclusion

As per above analysis, it can be said that a contract can take place between Richard and his father if both parties separate their relationship as per the family law of Australia. As per the family law, a son cannot enforce the father to pay for his loss because the expenses over the son by the father will be greater than the loss. On the other hand, the section 60CC (2) of Family law defines that the court should need to make the decision for the child to retain the relationship with both parents. Hence, it can be said that there was a not a contract between both parties and father of Richard will not be liable for anything.

Overview of Case

Joe was an actor and entered into a contract with Frère Bros for giving his services to company for the next five years. But, he has entered in another contract with Pretty Pictures that was a great loss to the Frere. Because of this, Frere Bros wants remedy against Joe on the basis of the breach of contract terms.

Issues in Case

As per the overview of case, it can be stated that there are several issues, which have answered. Followings are some important issues, which are given below:

• Did Joe have to right to form another contract, when he was bound by the terms of previous contract?
• Did Joe breach the contract, which was signed with Frere Bros?
• Does the contract law give any remedy to the Frere against the action of Joe?

Rules

As per the law of contract, the parties involved in a contract can be able to terminate or cancel the contract if both parties are ready for it. Otherwise, if any term of the contract does not obey or performed by any party in action, may be liable for the contract breaching. It means the breach of contract will take place, when any party does not perform the action as per the terms and conditions included in the contract (McKendrick & Liu 2015). If any party will breach the contract and plaintiff sues against breaching party then followings are some remedies that are available to the plaintiff.

• The plaintiff has right to terminate the contract;
• Plaintiff has right to get compensation for recovering from damages;
• Plaintiff can take the help of court to impose pressure on the other party to fill the terms of the contract till the completion of the contract (McKendrick & Liu 2015).

Application

In the context of contract law in Australia, there are several cases in that court has given the importance of the rights of the plaintiff against the contract breaching parties. Some of the important cases are given below:

Forklift Engineering Australia Pty Ltd v Powerlift (Nissan) Pty Ltd

In this case, Forklift Engineering Australia made a commitment to delivering the products of Nissan. The dealer agreement included a provision that entitled the contract termination power; if other involved parties have committed a breach of agreement. Powerlift Pty Ltd wanted to activate this provision against the failure of Forklift of paying invoices and providing information (Cornwall Stodart 2015). As per the case, the court gave the decision in favor of Powerlift and held that Powerlift (Nissan) Pty Ltd has not breached the contract and the company was entitled to terminate the agreement due to the action of Forklift Engineering Australia Pty Ltd.

Mobileciti Pty Ltd v Vodafone Pty Ltd

This is a recent case. In the case, the Supreme Court of NSW (New South Wales) gives the contract terminating right to the plaintiff on behalf of material misrepresentations. In this case, the court defines the meaning of material and held that the material is an English word that is employed in the contract should be assessed from the viewpoint of contracting parties (Dixon & Ferguson 2012). Hence, the plaintiff has a right to cancel the contract if the other party or defender does not meet the requirement related to the materials.

Ellul and Ellul v Oakes

The Elluls took the decision to purchase a house of Oakes. During the decision, Elluls relied over a statement, which was listing in the real estate agent form. The included statement states that the property was sewered and the form was signed by Oakes. After the contract formation, Elluls claimed for damages against the other party under the contract breaching terms because there was not sewered attached to the property as per the contract (Barker, Grantham & Swain 2015). In this case, Supreme Court of Australia held that the case represented sewerage was made by the seller to induce a buyer to purchase the property. But the court held the statement was not part of the contract so; the plaintiff may not get the contractual remedy.

Shepperd v The Council of the Municipality of Ryde

In this case, the High Court of Australia held that the assurances used in Council’s brochure and plan gave place to conduct collateral contract. As per the case, it was the intention of the defendant to show such documents, which can motivate the plaintiff to rely on these documents (The New South Wales Bar Association 2006). Hence, the action of the plaintiff should be succeeded.

JJ Savage v Blakney

In this case, Blakney entered into a contract with Savage to build a boat. For this, Savage said some particular requirements related to the boat in which the estimated speed of the boat was 15mph. The boat did not achieve the terms of 15 mph. Therefore, Blakney sued the other party for the breaching of contract (Julie Clarke, 2013).  The Supreme Court held that the particular requirement was not a requirement for the contract therefore; the defender will not be responsible for the loss of the other party.

Conclusion

On the basis of above discussion related to rules and application, it can be stated that Joe breached the contract because he did not follow the term included in the contract with Frere. Further, he signed another contract that means he did not ready to provide his services to the company of Frère Bros. In this context, the rules associated with breach of contract states that the plaintiff may get the remedies against the contract breaching party. In this sense, cases such as Ellul and Ellul v Oakes and Mobileciti Pty Ltd v Vodafone Pty Ltd also describe that the court also gives the rights to the plaintiff to remedies against the breaching party. Therefore, Frere can ask compensation for the loss of the company by defending party.

References

Barker, K, Grantham, R & Swain, W 2015, Law of Misstatements, Bloomsbury Publishing.

Cornwall Stodart 2015, Cororate & commercial Newsletter-2015, http://cornwalls.com.au/sharing-knowledge/legal-updates/corporate--commercial-newsletter---august-2015.aspx

Dixon, K & Ferguson, D 2012, Addisons Contractual Interpretation Series - “Material Breach”, http://www.addisonslawyers.com.au/knowledge/Addisons_Contractual_Interpretation_Series_-_%E2%80%9CMaterial_Breach%E2%80%9D330.aspx

Familylawexpress.com.au 2011, Maddock & Maddock & Anor (No.2) [2011] FMCAfam 1340, http://www.familylawexpress.com.au/family-law-decisions/property/property-settlement/maddock-maddock-anor-no-2-2011-fmcafam-1340/

Gibson, A & Fraser, D 2013, Business Law 2014, Pearson Higher Education AU.

Julie Clarke 2010, Gordon v Macgregor (1909) 8 CLR 316, http://www.australiancontractlaw.com/cases/gordon.html

Julie Clarke 2013, JJ Savage v Blakney (1970) 119 CLR 435, High Court of Australia, http://www.australiancontractlaw.com/cases/savage.html

Lynn & Brown Lawyers 2016, Gift or loan? How loan agreements affect separating parties. What parents need to know, http://www.lynnandbrown.com.au/project/gift-or-loan-how-loan-agreements-affect-separating-parties-what-parents-need-to-know/

McKendrick, E & Liu, Q 2015, Contract Law: Australian. NSW: Palgrave Macmillan.

The New South Wales Bar Association 2006, Problem Solving in an Equity–Commercial Context, 

http://nswbar.asn.au/docs/professional/prof_dev/BPC/course_files/Problem%20Solving%20in%20an%20Equity%20Commercial%20Context%20-%20Lindsay%20SC.pdf

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