Question

Contracts contain private rights that, so long as they meet the elements of a legal contract, are enforceable through the judicial branch of the government. There are limits on what contracts will be enforceable but for the most part, the government will enforce commercial contracts even if they result in an unfair outcome. For example, pay day lenders charge high interest rates for loans knowing that people with low credit scores will have less opportunities for loan products. Also, cell phone companies can include one-sided terms in their contracts knowing each individual consumer has little opportunity to challenge the terms.

What are you thoughts on this? On the one hand, people who invest their money to create economic opportunity rely on the judicial system to protect their property, rights and profit. On the other hand, given that litigation is very expensive, sometimes only those with resources are able to fully access justice.

Please write a 3-paragraph essay in the following format. The first paragraph should discuss the elements to contract formation, to have a legally enforceable contract. The second paragraph should discuss at least 3 defenses to contract enforcement. The third paragraph should discuss your opinion on the role of contract law in business. For example, do you think it is fair to enforce contracts so long as people have the capacity to consent? Do you think contract law simply favors those with money and power? Please share your thoughts.

Answer 1

Answer -

A contract is a legally binding document that specifies the rights and obligations of the parties to an agreement and regulates them. A contract is legally enforceable unless it complies with the legislation's criteria and approval. Usually, a contract entails the exchange of all of these items, services, assets, or promises.

The terms "agreement" and "contract" are used interchangeably, but they are two separate things, legally speaking. An agreement between two or more parties is simply an understanding or arrangement. A contract is a specific arrangement with enforceable court terms and conditions.

1. Elements to contract formation, to have a legally enforceable contract.

An arrangement between private parties that defines contractual obligations which are enforceable by law. Mutual consent,expressed by a valid offer and acceptance; sufficient consideration; capacity; and legality are the essential elements needed for the agreement to be a legally enforceable contract.

2. What are the Defences in contract law?

Mutual or unilateral error, coercion or excessive control, unconscionability, misrepresentation or fraud, impossibility or impracticability, and frustration of intent are some other examples of possible defences to compliance of a contract.

DEFENSES Against CONTRACT BREACH

1. What are valid protections against a contract claim violation?

For enforcement of a contract or responsibility for damages, the most common defences are:

Contract compliance would violate public policy.

Example: A deal to lease part of a liquor licence would not be implemented since it contradicts the state's public policy by dividing a liquor licence between two parties and two places. See Weingardt v. Digesu, 91 N.M. (1978) 441, 575 P.2d 950.

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2. Performance of the contract has become impossible or the purpose of the contract has become frustrated.

Example: Dan hires Tom to paint his house, but the house burns down before the contract can be performed.

3. The contract is illegal.

Example: The contract is for commission of murder.

4.The contract lacks consideration.

Example: Tom promises to give $20 to Dan, but Dan does not have to do or give anything in return.

5. The contract was obtained by fraud.
The success of the contract has become difficult or it has frustrated the intent of the contract.

Example: Dan hires Tom to paint his house, but before the contract can be carried out, the house burns down.

6. The arrangement is unconstitutional.

Example: The contract is for a murder commission.

7. The agreement lacks consideration.

Example: Tom offers to give Dan $20, but Dan has nothing to do or give in exchange for that.

8. The agreement was achieved by bribery.

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Example: Blue Company refuses to sell to Red Company, so Red Company sends Pink Company to buy goods from Blue Company and turn them over to Red Company.

9. The contract limits the amount of damages that can be recovered.

Example: The contract states that in the event of a minor breach, the damages will be $100 regardless of the actual loss.

10. The contract contains a mutual mistake, stating something different from what either party intended.

Example: Both parties intended a delivery date of
Blue Company refuses to sell to Red Company , for example, so Red Company sends Pink Company to buy Blue Company products and pass them to Red Company.

11. The agreement restricts the amount of harm that can be compensated.

Example: The contract specifies that the damage would be $100 in the case of a minor violation, irrespective of the actual loss.

12. The contract involves a reciprocal error, saying something distinct from what was intended by either party.

Example: A delivery date of March 15 was intended by both parties, but the contract says April 15.

13. The agreement involves a unilateral error that was material to the agreement and the other party knew or should have learned of the error.

For example, Maria paid Tom a lot of money for a "Picasso" painting. Tom knew that Maria thought it was painted by Pablo Picasso, when Arnold Picasso was really the painter, but the misunderstanding was not corrected by Tom.

14. The parties have acknowledged as satisfactory the performance of the contract, or a substitute for the performance. This is called agreement and contentment.

For example, Tim owes Frank a contract debt of $100. In return for discharging the loan, Frank agrees to accept a radio worth $50. The Court will not enforce the original contract when Frank changes his mind and sues for the extra $50.00 since Frank has acknowledged the radio as the performance of the contract.

15. Either (or both) of the parties had no capacity to conclude the agreement.

For eg, a party to the agreement is 16 years of age or mentally unstable.

3rd Paragraph -

In business contracts plays an important role. Because In the traditional case, because a contract is a legally binding arrangement, you and the other party are both required to satisfy the terms of the contract if you enter into a contract with another person or company. But in the eyes of the law, it is possible for an otherwise legal contract to be considered unenforceable, and this paper looks at some common cases where that may be the case.

CONSENT PRESUMED Ability The Civil Code does not specify who has the ability or legal capacity to consent to a contract. On the contrary, it determines those that have no power, from which it can be concluded that power is the general rule that resides among those that have not been refused from statute.

3.No, Because contracts are in favour of everyone.

Modern contract law is also vulnerable to contractual obligations imposed
By coercion, dishonesty or lack of meaningful option due to power
Unequilibrium.

There are some explicit theories of contract law that discuss problems of unfairness, such as

Doctrines of recklessness and good faith.

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Because contracts are concerned with economic exchanges, contract law must
inevitably be economic in its purpose. After all, the goals of contract law include
facilitating trade and commerce, regulating the manner in which people deal with

each other in the marketplace, and enforcing commercial obligations. In the United

States, the basic philosophy of contract law has been capitalist and geared toward the

ideal of a free market.
Since economic exchanges are concerned with contracts, contract law must be
Be economic in its intent, inevitably. The purposes of contract law, after all, include
Facilitating trade and trade, controlling the way people deal with it,

On the market, and imposing commercial responsibilities to each other. In the United States of America

The underlying theory of contract law was capitalist and oriented towards the States.

A free market ideal.