Many businesses—both commercial and individual—are performed pursuant to agreements/contracts, either written or oral, and law courts decide argument between the contracted parties.
1. INTRODUCTION In the beginning of the formation of state and the laws getting codified, the legal system as such did not recognize contracts as legal as legal entity or something in which the state will poke its nose into....
For many years thereafter, Pierre du Pont was portrayed as the villain in contrast to Teagle and Swope. For example, the former general counsel employed by the National Labor Board, Columbia Law School professor Milton Handler, remembered du Pont as a person who tended to vote automatically for the business side in a dispute. This was in contrast to Teagle and Swope, whom he recalled as "very, very fair-minded men and they called the shots as they saw them" (Gross 1974, p. 44). Another member of the board's staff said:
Roosevelt not only was familiar with the basic plan and the corporate support for it. He knew he was trying to bring about recovery within the constraints that were likely to be set by the Supreme Court if the executive branch tried to regulate the economy. Roosevelt and his advisers feared that the extremely conservative court, consisting primarily of former corporate lawyers, would find legislation regulating wages to be unconstitutional. It was likely to do so on the grounds that regulating wages was an infringement on the right of individuals to freely negotiate contracts, as it had done just ten years earlier. So they figured that the only way to obtain the minimum wage and maximum hour laws they wanted was through agreements hammered out by business and labor leaders in each industry. Unfortunately for the liberals and labor, the White House had to find ways to induce those agreements by giving business something it wanted even more, the ability to set minimum prices and restrict output without fear of antitrust prosecution (Schlesinger 1958, p. 101).
If it were only a matter of Lewis and Hillman in coal and garments, perhaps the corporate moderates might have conceded the point on majority rule, although the du Ponts and other ultraconservatives would have objected mightily. However, there was an even more serious issue: the growing unity and militancy among both craft and industrial workers, especially in steel, rubber, autos, and other heavy industries. The moderate conservatives did not want to see most workers organized into industrial unions, especially unions supported by national laws. The idea of collective bargaining was acceptable if it was voluntary and involved craft workers, but not if it was mandatory and contained the potential for uniting all workers. There is also a little bit of evidence that some business leaders, usually in highly competitive sectors with many small companies, could see the benefits of unions in helping to limit competition among businesses by means of making wage reductions. However, even the historian who presses this point the furthest concludes that in the final analysis almost all business owners rejected unions as a threat to the right to manage their enterprises exactly as they pleased (Gordon 1994, p. 238). At the most general level, then, as one historical institutionalist concluded in a rare nod to the importance of class conflict, a large part of the problem boiled down to the fact that virtually no corporate leaders wanted the government to have the power to help create a fully organized working class (Skocpol 1980, p. 181).
CONTRACT LAW CASE STUDY 2
A band called 'The Illusionists' are performing their first UK tour. They have decided to
use Rochford Concert Hall (RCH), a newly constructed venue for their first night.
Tabby, the main singer was informed by the manager that the hall would hold 2500 people and that the acoustics were suitable for their performance and that they should have no problems. However the managers didn't mention the fact that due to licensing matters, the concert had to come to an end by 11.00 p.m.
The members of the band signed the contract of hire for the venue, and began to sell the
tickets. They were pleased to hear that all 2500 tickets were sold very quickly.
However, on the night of the concert, only 1800 were admitted onto the premises on the
instructions of the local police due to health and safety reasons. The police also informed
the band that even though the tickets displayed the finishing time of the concert as 1 .a.m,
the licence of the venue only entitled them to be open until 11.00 p.m.
This setback resulted in 700 people demanding their money back due to not being
allowed entry on the night and a large percentage asking for some reimbursement as
the concert finished earlier than had been advertised on the tickets.
Tabby and the other members of the band are seeking advice from the firm. You have
been instructed to write a letter to 'The Illusionists' on the following issues.
a) Whether there was a duty to disclose information related to the licence of the
b) Did the manager's comments amount to misrepresentation?
c) Are there any remedies available to the band?
Ahmed owns a gallery. He felt that the gallery needed a makeover and decided to
refurbish. In order to do this he went to see Catherine, a local antiques dealer. He
shared his ideas for the gallery with Catherine and informed her that if possible he was
looking for some eighteenth century chairs by the 'Goya Brothers'.
Catherine showed him a variety of furniture and he saw some chairs which looked
identical to those he was after. He told Catherine that he believed these were the
chairs and would like to buy them. Catherine didn't say anything but was aware that
they were not genuine. However she sold them to him nonetheless.
Due to the refurbishment, Ahmed has just had the contents of the gallery re-valued
for insurance purposes, but discovers that the chairs are very good copies and is
advised to insure them for £50 each rather than the £2000 each he believed them to
He is disappointed and has asked the firm for some advice. He is hoping to return the
chairs and have his money refunded.
The senior partner has asked you to write a report on the following issues.
a) Whether there is an operative mistake?
b) Would it have made any difference if Catherine was unaware of his mistake
and also believed that they were the original chairs?
What effect, if any would Ahmed's mistake have on the contract?
CONTRACT LAW CASE STUDY / SCENARIO
Mrs. Turner has decided to start her own business running a private day nursery. It is
necessary for her to find appropriate premises. She sees a detached house, which would be
appropriate, on the market for £200.000. After having viewed the property she decides to make a bid for the property for £150,000. The sellers state clearly however that they will only accept £180,000.
Mrs. Turner then sees another property on the market for £250,000. She offers the asking price for this and it is accepted 'subject to contract.'
However a week later the sellers of the first property contact Mrs. Turner again stating that they have reconsidered are now happy to accept her bid for £150,000.
Your supervisor has requested that you research the relevant issues and compile a report for her attention which, outlines your findings.
Mrs. Turner has now purchased a suitable property and is now purchasing the necessary items required to run her nursery. She looks on a website and sees cots and high chairs advertised for sale by a company named Babies R Us, on the 1st October 2003, requesting twenty cots and twenty high chairs, requesting a reply by the 21st November 2003.
She received a reply by post, confirming the order, on the 1st December 2003. This was postmarked 20th November. However on the 30th November, Mrs. Turner had assumed that Babies R Us were unlikely to reply and therefore, entered into a contract with a rival company.
Mrs. Turner has made an appointment to see you to gain advice relating to the above problem.
Equally, she would appreciate some advice relating to the formation of contracts by e-mail.
Mrs. Turner's nursery has now opened and has recruited well. She is concerned as to the
different types of liabilities, which she may be affected by during the course of her business and would appreciate it if you could write to her regarding this.
Explain the different types of liabilities and along with examples.
CONTRACT LAW CASE STUDY 2, ASSIGNMENT 2, TASK ONE
Barry is a retired lorry driver who has just set up his own distribution service called
'Deliveries R Us'. Pencilbox PLC, his first customers, want to use Barry's service to
deliver stationery to some of their retail outlets. They reached an agreement and a
contract was signed whereby Barry would deliver 'a minimum of 3000 boxes of
stationery for Pencilbox over the next 12 months. ' The contract was to commence on the
1st April. No maximum figure was specified in the contracts and a delivery charge of
£1.00 per box was laid down by Barry.
Barry expected to deliver a higher amount than the minimum specified and so decided to
take out a bank loan in order to upgrade his existing fleet of lorries.
However six months later, Pencilbox pic wanted to renegotiate the delivery charge
threatening immediate withdrawal unless the charge was reduced to 50p per box. They
also told him that they wanted him to enter a three year contract with 'Gadgets Ltd' a
subsidiary of Pencilbox pic or they would terminate their business arrangement with his
Barry has found that his distribution service hasn't been as busy as he believed it would
be and so agreed to the new arrangements as he didn't want to lose their custom even
though he was aware he would be making a loss on the contract with Gadgets Ltd.
Barry has asked for your advice. You are a junior partner of Patel and Brown
Solicitors and have been asked by your senior to write a report on whether he
can claim the lost monies for every delivery he made on the grounds that the
modification made to the contract was due to improper pressure.
You have been asked to write a letter to the following client, Julia.
Julia, a partially sighted invalid, jointly owns a home with her husband Charles. The
family home has been mortgaged to Braddale Building Society.
Over the last year, Charles has been experiencing great losses in his business and has
failed to meet a number of mortgage repayments. Due to this the building society has
started proceedings against the couple. As they don't want to lose possession of the
house, Charles and Julia have approached their bank, Rochford Bank Pic and hope to
refinance the mortgage. The loans manager, Mr Credit, arrived at their home with
important documents and papers regarding the loan.
Julia was not happy with this and told Mr. Credit that her husband's business wasn't
doing well and that she strongly believed it would carry on making a loss and in view of
this she was not going to sign any documentation that covered Charles' business
Mr. Credit assured her that the papers didn't cover any business liability and that if she
didn't sign there would be danger that she would lose her home. He was so persistent
that she signed.
Julia hesitantly asked for the documents to be fully explained to her again as she was
unable to read the documentation because of her disability. Having heard the
explanation she reluctantly signed the papers.
Julia has now discovered that the documents not only cover a mortgage relating to
the house but also cover Charles' business debts.
Julia is very worried as the bank is insisting on enforcing the agreement. Your letter of
advice should cover the following.
1. Discuss grounds on which Julia might avoid the contract and whether
any remedies are available.
2. Would the situation be different had Julia taken independent advice
and then entered the agreement.
Catherine is employed as an accountant at 'Cash and Co.' and based in a firm in
Bradford. She has worked there as an employee for 6 years and her original contract of
employment prevents her from working as an accountant within 60 miles of Bradford if
and when she left the firm. After a successful interview, she has received a lucrative
offer from a firm of accountants in Leeds where she would be employed in a higher
position. She resigns and commences her new employment. 'Cash and Co.' have sent her
a letter stating that are going to take matters further as she has breached her contract of
You have been asked to write a memorandum to Catherine to outline her position
regards her previous employment contract.
EMPLOYMENT LAW ASSIGNMENT 1
You work as a legal adviser at the practice of Chancer and Dodge. There are currently a
number of files on your desk which require your urgent attention.
Recently, a member of the public, Valerie Reid, sustained personal injuries Whilst
attending Nabbey bank to conduct some business. Whilst on the premises, she tripped
over some cable attached to the computers used by the cashiers. At the time, Jamie
Conway was working on the premises updating the hardware for those computers, hence
the reason for the loose cables. Jamie has worked at various branches of Nabbey for the
past two years. He has paid his own tax and national insurance contributions, and has not
taken any holidays whilst working for the bank.
In your capacity as legal advisor for the bank, write a report covering the following points:
1. An assessment of the employment status of Jamie
2. As to whether the bank bears any liability for the injuries sustained by Valerie
You have been invited to be a guest speaker at nearby Bakefield College. You will be
talking to a group of business students who no prior legal knowledge on various aspects of contracts of employment.
The detail of your brief is as follows:
Prepare brief notes for a presentation covering the following:
i) Summarise the basic principles of law covering the creation of a contract of employment
ii) In relation to obligations affecting employers , identify
a) Those terms which are generally held to be implied
Into a contract of employment
b) The various ways in which both express and implied
Terms can be incorporated into a contract of employment
Up until 4 months ago, Jason King was on the books of the "Mpower" Employment
agency. Jason worked for this agency over a number of years, carrying out many
assignments for different organisations. Unfortunately, the agency became insolvent, and
Jason had to leave, whilst still being owed money for his last assignment.
Three months ago, Jason started another job, working for Bovan Furniture manufacturers.
However, it was only last week that he received a document Titled "Particulars of Your
Employment". Jason noticed that this statement contained no details of place of work,
notice periods, or holidays.
Jason now seeks your advice on a number of points:
i) Was he ever actually an employee at the Mpower agency ? If so, he would be
able to claim redundancy pay.
ii) Has he actually received a contract of employment from Bovan ?
iii) what legal remedy does he have in relation to the missing items on the
document which he has received?