Law of Contract

Law of Contract

A) Law of contract
An agreement enforceable in law, a contract, needs to fulfill 4 elements: offer, acceptance, consideration and intention to be valid. It legally binds parties to act in accordance to the verbal or written terms stated in the contract. If there is a breach of contract, the innocent party can sue for damages or demand for specific performance to be done.

a) Applicable law

There are three categories of terms of contract: conditions, warranties and innominate terms. Classifications of these terms are imperative as consequence faced will vary from termination of contract and/or paying for damages. Condition terms are the fundamental terms of a contract, going to the very root of the contract (Poussard v Spiers (1876)). A breach of condition allows the company to terminate the contract and collect reparation from the contract breaker.

Applying fact to law
In this case, Ravi and MicroHard signed a contract where one of the terms- (3) stated in the contract was that MicroHard will provide resources and utilize employees to perform the necessary services. People engage MicroHard solely for its software support services. Therefore, it is a condition that MicroHard will provide services to resolve software problems. However, MicroHard did not fulfill those conditions. The sent employee was incompetent and failed to perform the service of repairing Ravi’s software. Therefore there was a breach of condition by MicroHard.
Both parties had the intention to create legal relations and past cases have proven that terms in the contract are deemed as conditions (Behn V Burness (1863)), thus validating the breach of condition. Therefore, Ravi can terminate the contract and claim damages from MicroHard.

b) Applicable law

Warranties, secondary in nature, are not vital terms of a contract. A breach of warranties only allows the injured party to claim damages but not terminate the contract, (Bettini V Gye (1876)). There are two...

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