Commercial Law; sample paper – Cheap Research Essays

Commercial Law

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Institution

Two parties are only able to finalize their contracts when one party makes an offer to another who in turn responds to the offer within an appropriate time. Therefore, both the parties entering a contract must fulfill their demands within a specified time limit. According to Weber and Mayer (2011), time limit has an impact on whether the statements made during the contract negotiation are enforceable or not. The lapse of time operates can possibly terminate an offer in the case where the recipient fails to respond within the appropriate time. An offer cannot remain open for an unspecified period of time since this makes it difficult to determine the serious recipients to the offer. Time is of the essence tothe contract and both parties are required to adhere to the reasonable timelines stipulated in the contract (Sitaraman, 2014). The recipient responding within stipulated time means that he has fully accepted the terms and conditions stipulated in the offer. A delay in responding to the offer may imply that the recipient may not becomfortable with the terms and conditions of the offer. When the offer is not responded to within a reasonable time the offeree has the right to terminate the contract without any further legal problem. According to Rosenberg (2013), termination of the offer due to lapse of time is a common legal factor that is greatly applied in the sale of goods contracts.

The parties entering a contract have the freedom to specify the time limits within their contracts or to assume such time frames (Sein&Uusen-Nacke, 2010). However, when the specific timeframes are not specified by the parties entering into a contract, the courts have the freedom to determine the reasonable time under which such a contract ought to have been valid. The courts usually look at the time the offer was made and compare it with the time period the attempted acceptance was communicated in determining the reasonability of the time frames. The offer and acceptance element is used to determine whether the two parties entering a contract are of one mind. According to Mitchel (2009), acceptance is only valid if one party to the contract engages in conducts that manifest their assent through a recognizable means. For acceptance to be valid and enforceable to both parties, it should be communicated by a proper means as was the case in Robophone Facilities Ltd v Blank. Another important rule of acceptance is that it can only be accepted by the offeree and not any other person as that would make it invalid. In case of agency, the agent can only accept the offer by expressed authority of the offeree (Miechel, 2003).

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In this case, both Naiker and Ahmad wrote to each other and this forms the basis of the validity of their contract. This contract is legal since Ahmad is at full capacity to dispose his piano to anybody who wishes. According to Korobkin (2013), a contract only becomes unenforceable is the goods involves are illegal goods such as drugs and illegal firearms. In this case, both Naiker and Ahmad are both of sound minds and are of mature age asrequired by the law that the people entering into the contract must also be of mature age and should not be of unsound mind. Since both Ahmad and Naiker have the intention of selling and buying the piano respectively, their legal contractual agreement has a legal basis. Due to this, there is an unequivocal manifestation by both Ahmad and Naiker to enter into the piano selling contract (Gergen, 2013). The offer for the sale of goods needs to be communicated by both parties; this offer remains effective the moment it was received by Ahmad. However, the attempts by both Naiker and Ahmad to enforce their contract within a reasonable time have been frustrated by the delays in postal services. It is not the wish of Naiker and Ahmad that their letters delay in postage and this delay are likely to bring a twist in their contractual terms. When no specific duration is specified in the contract, the offeror and the offeree has the freedom to exercise their contractual agreement within a reasonable as can be attested by the bystander (Gavrilovic, 2013).

Despite the letter of offer and letter of acceptance reaching both parties in good time, the offer can still be revoked as was held in the case of Dickson v Dodds. The issue in this case was whether a promise to hold an offer open is binding until the other party who had no idea that the offeror has already passed the property. It was held that an offer to sell the property becomes terminated whenever it comes to the attention of the offeree that the offeror has already decided to sell the same property to a third party. In this case under the study, Ahmad knew that Naiker had already withdrawn his acceptance and thus decided to focus on another party. The law also demands that an offer becomes terminated whenever the offeree refuses to accepts the offer in an expressed or implied means (Cherednychenko, 2014).

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The issue of reasonable time was well discussed in the case in Ramagate Victoria Hotel Ltd v Montefiore. This case attempted to answer the question with regards to the length of time an offer remains open for acceptance. In this case, it was held that an offer can only remain open for a considerable period of time due to inflation and fluctuation of prices in accordance with the market demands. If the offer can remain open forever, then either party can run into losses due to fluctuation in commodity prices with time. After the lapse of a reasonable time, the complainant cannot go to court and be awarded with specific performance as the legal remedy (Gergen, 2013). In determining the reasonable time, the commodity is considered with respect to perishability and fluctuation in prices so that justice is serviced to both parties. A similar case of lapse of time was also reviewed in the case in VirjiKhimji v Chatterbuck, in which it held that a reasonable time had elapsed and thus the contract was unenforceable.The general rule also demands that silence does not amount to acceptance of the offer and thus Ahmad is free to resell his property after failing to get a timely response from his buyer.Even thoughNaikerwas interested in buying the piano, the delay caused by postal strike frustrated the timeliness of his contract.Therefore, a reasonable time had already elapsed and thus Ahmad was within the law to reconsider his stand of selling the piano to Naiker. Therefore, I can advise Naiker that there is no enforceable contract between him and Ahmad and thus the court cannot award specific performance. Naiker would also have asked for specific performance if Ahmad had refused his contractual performance before the lapse of a reasonable time.

Concerning the performance at Emerald Concert Hall, the contract between Ahmad and the hallhas been frustrated by the natural calamity that has strike and destroyed their properties. The legal principle being tested in this case is whether a contract can be enforced after disruption by the natural calamity.The lightning and fire that destroyed the hall and the piano is a natural calamity that could not be controlled by either party. This legal principle was tested in the case in Financing Ltd v Stimson, whereby it was decided that an offer only become legally enforceable when it has not been interrupted by the natural calamity (Mitchel, 2013). In this case, the defendant bought the vehicle on hire purchase before the vehicle was destroyed in the hands of the seller. The bench held that offer has collapsed due to the bad condition of the vehicle. Therefore, the courts were implying that a contract only remains legally enforceable when the subject matter of the contract is within a proper physical state that is usable by either party. Naiker cannot sue the Emerald Concert Hall since the damage was caused by the natural calamity and neither can he be sued since the subject matter to the contract, which is a piano, has been totally destroyed. Therefore, the law demands that the continued performance of a contract depends on the subject matter being in a proper physical state that can be used for its purpose.