Valid Contract: Elements and Requirements

Introduction

The modern English contract law originated from Western Europe during the 14th century (Andrews, 2011). Towards the end of the 15th century, the law attained great importance as a solution for the broken agreements. By the 17th century, the law became a common decree for contract-related acts. During its initial stages, the common law courts were exercising extensive jurisdiction over private contracts. In the course of time, the jurisdiction over private contracts was progressively extended. After the US attained its independence, it continued using the English contract law. To date, the US contract law contains major facets of English contract law. This paper seeks to identify the common doctrines associated with modern contract law, ethical considerations associated with the law, and the legal impacts the technology has had on the topic.

The contract law’s main objective is to ensure that promises are formed and kept. Similar to other laws, this law reflects our social values. For instance, it illustrates the degree to which a person can be allowed to make pledges and loyalties that are lawfully binding. It indicates the difference between pledges that make moral responsibilities and pledges that are lawfully binding. Contract law identifies the justifications the public is willing to acknowledge for flouting certain types of pledges. In addition, it recognizes the pledges that are perceived to be opposing the contract policy and therefore lawfully binding. Generally, the law influences the concerned individuals to come up with contracts for lawful objectives (McKendrick, 2007). As such, no feature of contemporary life is completely void of contractual relations. Ordinary clients in their customary behaviors obtain rights and responsibilities with the support of the contract law. For instance, when consumers purchase electrical appliances or obtain loans they acquire rights and obligations. In this regard, contract law is premeditated to enhance constancy and confidence to both the customers and the producers in the market.

An analytical discussion of the legal issues that are involved. This would entail examining the issue from different viewpoints

For a contract to be legal, four elements must be met (Furmston & Mik, 2010). Failure to satisfy any of the four elements in the agreement will make the contract not to be deemed as a lawfully binding document. These elements are agreement, consideration, contractual capacity, and legality. An agreement to form a contract must entail an offer and an acceptance. One party is required to come up with an offer, and the other party is then expected to accept the terms and conditions of the offer. With regard to consideration, any guarantee offered by the parties ought to be supported by legally sufficient and bargained-for consideration. This might include a valuable product or service to induce one of the parties to make a transaction. Concerning contractual capacity, the involved parties making a contract ought to have the contractual ability. This implies that the law requires the individuals to have a distinctiveness that accredits them as capable parties. With regard to legality, the law mandates that the contract’s purpose should achieve some goal that is legally accepted and not contrary to the public policies.

A contract can be enforceable if the rules offer a contract-based remedy for violation of the accord (Furmston & Mik, 2010). If the law fails to provide such remedies, the contract is considered unenforceable. Even after meeting the above elements, a contact can still be unenforceable. A specific requirement has to be met to make a contract enforceable. This requirement is the legitimacy of assent and form. The requirement is invoked as the safety of the enforceability of an otherwise suitable treaty. It is required that the apparent consent of the involved parties be genuine. For instance, if it is later found out that a contract was established based on deceptive, unjustifiable manipulative, or forced interest, the agreement will be unenforceable.

On the other hand, a contract is said to be voidable when one or more of its parties has the authority to undo the legal responsibility associated with the contract rendering it void. The contract can be made void under several circumstances. These circumstances are lack of capacity, frauds, threats, and mistakes. A contract can be said to be void if it lacks legal backings.

Contract laws can be classified into formal and informal or express and implied contracts (Furmston & Mik, 2010). A formal contract is reached when an agreement that conforms to the legal requirements is signed. With the available legal agreement, a formal contract can be enforceable unless some reasons for enforceability are forwarded. All other contracts that do not meet the above conditions are regarded as informal contracts. Express contract is one which parties articulate their agreement in words. All other contracts that do not satisfy this criterion are considered as implied contracts.

Notably, contract laws differ from one country to another. In the western countries, the similarities between contract laws are huge. However, there are minimal similarities between western contract laws and some Asian contract laws. For instance, Saudi Arabia has a unique version of the contract law compared to the western contract law. As such, In Saudi Arabia, contract law is administered under the directives of the Hanbali School. The Sharia school is run by radical conservatisms in accordance with the interpretation of the Quran. Contract law is administered to all parties regardless of their religion and race, so long as they meet the Sharia rules. Under this law, a contract is realized through the exchange of services or products considered as commodities. However, this law does not consider some things as commodities such as pigs and alcohol. Unlike most modern legal systems in western countries, conclusion of contracts in Saudi Arabia must be carried out simultaneously with the transaction of offer and acceptance. Notably, the parties can still withdraw their contracts offer even after the acceptance.

A discussion of ethical considerations (What is legal may not be ethical)

Competitive markets function appropriately when transparency is upheld in its transactions and the interactions as required by the contract law. However, failure to upheld transparency will result in uncertainties. The uncertainties will result from the doubts of whether the contract will be agreed on as required. To reduce these uncertainties, a third party is often required to act. The third party may be a legal guarantor of contracts or an effective business ethics code. In contemporary society, it has been found out that legal monitoring and enforcement of contracts is very expensive and thus not sustainable. Parties realize later on after the damage cost of the delay in honoring the contract has occurred that the legal cost has been initiated. Because of this, contractual relationships in the market are normally undertaken by establishing long-term business relationship. Ethical codes and ethical convictions have served as a substitute for legal enforcements and monitoring. Through this, the contracting parties have been able to reduce exploitation potentials through long-term business relationships.

Even in markets with strict legal enforcement for those who breach contracts, it has been found that there are several contracts that are incomplete, ill defined, or indeterminate with respect to contractual obligations. Therefore, ethics have been used as a means to give substance to the expectation that the contracting partner will observe the contract and keep the promises agreed upon in the contract. Reliability and mutual trust on the part of business partners reduces the cost of economic exchange. As such, trust reduces transaction costs because the involved partners come to an agreement more easily.

During contract formation, some ethical consideration issues have been identified. These issues are cultural and moral relativisms. Cultural relativism refers to the degree to which diverse communities upheld diverse business and organization’s principles. According to those who upheld this relativism, they perceive that all principles are related to the people in a specific society. Those who upheld moral relativism visions believe that ethical issues and moral standards in a community are culturally bound. Compared to cultural relativism, this form of relativism’s views arises from individual basis.

Based on the above descriptions, there are a number of ways ethical considerations influence contract formation processes. In some cultures, a contract represents a development of an operational association between two parties rather than an officially authorized agreement. Through this perception, some cultural societies believe that contract is bendable. According to these communities, contract terms can be negotiated whenever issues arise. More often, this believe is not legally accepted in the western countries. With regard to ethical issue, when an organization sets up its business in a foreign land with this kind of views, they should function in a way that is in accordance with the host nation.

On some occasions, a party can use its influence over another party in the contract formation process. If the contract enforcers fail to notice this mistake when implementing the contract, it would be unethical. It is unethical to hold one party to a contract sealed under pressure. In the same manner, it is unethical to hold one party to a contract signed with the lack of informed consent. Considering this, it is essential that parties form durable contracts. Contracts should contain no legal loopholes. If a contract has legal loopholes, a party can use its influence to call off the contract with the aim of hurting the other innocent party.

A discussion of the legal impact technology has on this issue

For several decades, the relationship between technology and law has had several facets (Furmston & Mik, 2010). The use of technology has reduced the time taken in making contract process and solving contract issues in the courts. The time needed in carrying out some functions required in the contract making process has been reduced with the use of technology. Technology has also eased the way law courts solve cases including contract cases. With the adoption of technology, there is increased pressure on law courts to reduce backlog of cases.

Currently, there is a genuine need to address certain problems brought about by the change in how people conduct their business. Nowadays, contract law lies in the heart of e-commerce. Irrespective of the business model and the type of contractual subject matter, it is worth noting that all e-commerce transactions rely on the similar contract formation principles. Despite the fact that contract law and e-commerce have become a common phenomenon in the current marketplace, a thorough analysis on the effect of technology on this topic needs to be undertaken. Many questions remain unanswered, and many challenges have passed unnoticed.

A major technological hurdle encountered by e-commerce contracts is that intentions are evaluated objectively from the perspective of the addressee (Koffman & Macdonald, 2007). This principle assumes that what the maker of the statement says or writes is exactly what the addressee hears or reads. However, in contemporary situations the webpage viewed by the user may be presented differently than originally expressed. The manner the content is presented, and sometimes whether it is presented at all, depends on how a specific browser processes HTML instructions. Notably, each browser displays HTML files differently. This implies that a website displayed in internet explorer might not look the same as a website displayed on Google Chrome. The implications of HTML on contract laws are surprising and affect more than just a principle that intention is evaluated from the side of the addressee. When a party attempts to incorporate terms into a contract, the effectiveness of their incorporation often depends on the reasonableness of the notice that terms exist. The reasonableness depends on the visibility or conspicuousness, which is determined by the font or the colors used on the website. Font and color may be adjusted by the browser or device used by the addressee affecting on the quality of the terms offered by a party.

Another issue associated with technology is that complications might arise from the fact that the content displayed on the web page depends on the size of the computer display used by the addressee. The whole display may not fit into the screen even when the browser window has been maximized. Users may be required to scroll horizontally or vertically to see all its texts and graphical elements. The issue is more pronounced when the web page is viewed from mobile devices. Based on the above illustrations, it is a fact that scrolling decreases the likelihood of the end user noticing the terms and conditions of a specific contract. In addition, technology has strained the limits of interpretation and analogy in law. For instance, it is not always easy to differentiate between contract law involving e-commerce and a computer law.

A well defined and logically stated argument to support your position. This would include any suggestion or ideas for improvement in this area of law

In accordance to the above arguments, it is clear that contract law is a very essential tool in everyday market place. Therefore, it is essential that the contracts are formed and enforced in a legal manner. Through this, the involved parties would be protected from harming one another. With regard to the use of contract law in e- commerce, more studies should be undertaken to improve its efficiency. I believe that parties should insist that the addressees use specific browsers and devices when accessing their websites during the process of contract formation. Through this, they will be able to ascertain how the end users view their websites, and ensure that their intended messages are passed to the addressees. By doing so, the issues that arise from customers agreeing to contract without accessing the contracts’ terms and conditions will be eliminated.

I believe that international companies operating in various parts of the world should be aware of the diversity in contract law. This would lead to an appreciation of the differences in these laws. While operating in foreign countries, international companies must respect the host countries’ contract laws.

Conclusion

In conclusion, it should be noted that the modern English contract law originated from Western Europe during the 14th century. Towards the end of the 15th century, the law attained great importance as a solution for the broken agreements. By the 17th century, the law became a common decree for regulating contractual actions. The contract law’s main objective is to ensure that promises are formed and kept. Similar to other laws, this law reflects our social values. For instance, it illustrates the degree a person can be allowed to make pledges and loyalties that are lawfully binding. It indicates the difference between pledges that make moral responsibilities and pledges that are lawfully binding. Contract law identifies the justifications the public is willing to acknowledge for flouting certain types of pledges. In addition, it recognizes the pledges that are perceived to be opposing the contract policy and therefore lawfully binding. For a contract to be legal, four elements must be met. Failure to satisfy any of the four elements in the agreement will make the contract not to be deemed as a lawfully binding document. These elements are agreement, consideration, contractual capacity, and legality.

References

Andrews, N. (2011). Contract law. Cambridge: Cambridge University Press.

Furmston, M. P., & Mik, E. (2010). Contract formation: law and practice. Oxford: Oxford University Press.

Koffman, L., & Macdonald, E. (2007). The law of contract. Oxford: Oxford University Press.

McKendrick, E. (2007). Contract law. Basingstoke: Palgrave Macmillan.

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