Dark Hair Co Ltd broadcasts a television advertisement that claims its “Prevent White Pills”, if taken as directed, give complete protection against the greying process in men’s hair. The advertisement also provides that $1,000 reward will be paid to any man whose hair turns grey after using the Prevent White Pills for two weeks.
Ryan has jet black hair. He sees the advertisement and buys two bottles. He starts using the pills on 1 January 2011. Ryan gives the other bottle to his neighbour, Tom who does not know of the reward as he does not own a tv set. On 12 January, Ryan wakes up to find that his hair has turned white. Tom too is in the same predicament in the evening of the same day.
Using the four step process, advise Ryan and Tom whether they could claim the $1,000 reward by discussing the important elements for the formation of a contract.
1. The issue (or principles) of law in this case surrounds the validity of contract whereby there must be an intention & agreement to be legally bound by both parties along with an invitation to treat.
2. There are a number of requirements to ensure for formation of the contract to be legally enforceable, these include intention, agreement and invitation to treat.
There are a few important requirements in the formation of legally enforceable contracts, agreements, invitation to treat and offer/acceptance. The elements that require some discussion are of intention, offer/acceptance and invitation to treat.
A contract is an agreement that legally binds all parties involved. On occasions contracts are referred to as 'enforceable agreements'. This can sometimes be misleading as one party cannot usually force another party to fulfil ones part of the bargain. The usual solution to this is damages. Agreement itself is not enforceable at court unless all fundamentals of such an agreement must be present before an agreement can be regarded as binding at court.
An offer is a agreement to contract made with intention...