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Debbani answered on Aug 22 2021
MEMORNDUM OF ADVICE
MEMORNDUM OF ADVICE CONTRACTUAL ASPECTS
MEMORNDUM OF ADVICE CONTRACTUAL ASPECTS
MEMORANDUM
TO: Mr. Dennis Denuto, Instructing Lawyer
Dennis Denuto & Associates (Coolaroo office)
FROM: Mr LMN PQR
DATE: 22nd August 2019
FILE : Sheldon Cooper and Stuart
SUB:- Existence of Contract under Common Law
Table of Contents
1. BACKGROUND 3
2. FACTS 3
3. ASSUMPTIONS 3
4. ISSUES 3
5. CONCLUSIONS 4
6. LEGISLATIONS 4
7. DISCUSSION & ANALYSIS 4
8. Sources Consulted- Bibliography 9
1. BACKGROUND
I am advised by the Instructing Lawyer Dennis Denuto in the Coolaroo office of Dennis Denuto & Associates, to find that under the Common Law system, whether there exists a contract followed by the enforceable agreement between Sheldon Cooper and Stuart.
2. FACTS
Sheldon Cooper (SC) finds, an action figure in a comic book store of Stuart (S) for a tagged price of $ 750 on 18th February. After discussion on the figure, S offered the figure for a price of $ 600, to which SC expressed that he can pay that amount in two instalments. On 21st February, SC offered to pay $ 550 to S, to which S renewed the amount to be $ 575, to be paid within 23rd of February, where SC wanted some more time to decide. On 23rd of February, SC mailed S and expressed his willingness to buy the item at a certain price, which was overlooked by S and hence it was sold to Howard (H) for $ 600.
3. ASSUMPTIONS
Under common law regimen, normally the adverts on the shop windows or in brochures or maybe in media is considered as an invitation to treat and not an offer, So, an advertisement can take the form of an offer if the intention is clear and specific so as to bound the accepting party that is the offeree with the terms laid by the offeror. As the present facts do not depict any aspect of unilateral contract, since the acceptance is not required to be made by actual performance and not by acting according to the promise, so it is assumed that a bilateral contract was intended.
4. ISSUES
Whether there exists a contract followed by the enforceable agreement between Sheldon Cooper and Stuart
5. CONCLUSIONS
To answer whether under the Common Law system, there exists a contract followed by the enforceable agreement between Sheldon Cooper and Stuart, it can be concluded that there was no existence of contract between SC and S. Since in the first instance, SC made a counter offer which in itself extinguished the original offer made by S. Secondly, SC did not pay any token money or a minimum consideration so that the promise to keep the action figure till a certain period of time becomes an unenforceable gratuitous promise. Thirdly, based on the unenforceable gratuitous promise, if S sells the action figure to H or any other person, SC cannot enforce any binding contract as against S, since from the first instance there was no existence of any contract so as to make it binding as against S and thus cannot obligate S to perform his contractual obligation. Although the final email sent by SC was overlooked by S, even if it was overlooked then also no binding contract exists since Sc lost the potential option contract by not providing minimum consideration and secondly, he again stated a new price which again became a counter offer. Thus, it can be concluded that there was no formation of a contract between SC and S only due to the fact that there was no unconditional acceptance of the offer made by SC for the offer S provided.
6. LEGISLATIONS
No Legislations is used, since I am only instructed to follow the Common Law aspects.
7. DISCUSSION & ANALYSIS
Under the Law of Contract, a contract comes into existence on fulfilment of certain criterions. Firstly, there must be an offer followed by the unconditional acceptance, with a valid intention between the parties to create the legal relationship as was depicted in case of Forrest v ASIC [2012][footnoteRef:1], Ermogenous v Greek Orthodox Community of SA Inc [2002][footnoteRef:2], Ashton v Pratt [2015][footnoteRef:3], to make them legally enforceable as was mentioned in Banque Brussels Lambert SA v Australian National Industries Ltd (1989)[footnoteRef:4], Price v Southern Cross Television (TNT9) Pty Ltd [2015][footnoteRef:5], Malago Pty Ltd v AW Ellis Engineering Pty Ltd [2012] [footnoteRef:6], with an exception in case of Australian Woollen Mills Pty Ltd v Commonwealth of Australia (1954)[footnoteRef:7], and finally the presence of the capacity to enter in to a binding contract. In the instant facts of the case, the action figure was on display with a price stated on it. So, displaying certain item for the intended sale is not offer under the Contract Law but a mere invitation to treat. It is evident that all proposals do not have the force or the certainty to be an offer. Hence, to be qualified as an offer, there must be the presence of an indication or an willingness by the offeror that when the offer becomes directed or offered to the intended party then the on acceptance of that party there is a possibility that the enforceable contract will come into existence at the very instant when the offer is accepted. But, there is the basic difference between offer and the invitation to treat, since the later is a mere negotiation which can take the...