Frank and Carl formed a contract with Nicky’s Novelties over the promotional items. A contract is an agreement which gives rise to obligations and which is enforceable by law. A contract must contain the following elements in order to be legally binding: an offer, acceptance, consideration, intention to create legal relations and capacity. Into every contract where goods are sold in the course of business there is a term that the goods must be fit for their purpose, of satisfactory quality, will correspond with their description and bulk goods will correspond with any sample.
An offer can be made orally or in writing, but the important thing is that the person making the offer is indicating that he’s willing to be bound if his terms are accepted according to Carlill v Carbolic Smoke Ball Co Ltd . Frank and Carl’s offer was to have the products by a certain time which Nicky’s Novelties accepted; this would be shown in the invoice. This is different from an invitation to treat as this must be distinguished from an offer, since there is no intention to be bound; it is merely an opening of negotiations as referred to in Fisher v Bell .
Acceptance means that the contract must offer the terms of the offer precisely, nothing new to be introduced. Acceptance must be communicated, silence is not acceptance and acceptance may be completed by carrying out an action as shown in Hyde v Wrench . Nicky’s Novelties accepted the invoice and did not communicate that they couldn’t adhere to these terms. As a general rule, acceptance takes effect when it is received, with the exception of the postal rule. An offer could end by revocation, meaning, that it is taken back, this must be communicated. It could also end by refusal by the offeree, by lapse of time or by counter offer as seen in Dickinson v Dodds .
Consideration often defined as, ‘the price paid for the promise’ must be sufficient, but need not be adequate and contributed by both parties. Intention to create legal reasons means that business to business contracts are legally binding but social contracts are not, it also means that all parties must go into a contract with intentions that their contract is legally binding as seen in Simpkins v Pays . Nicky’s Novelties are a business and therefore the contract between them and Frank and Carl are legally binding. Capacity means that the person making the contract has the capacity to fulfil the contract, which Nicky’s Novelties did. In order to sue and enforce a promise, a claimant must show that he supplied consideration for that promise. Nicky’s Novelties did not show consideration for the fact that Frank and Carl needed these products by a certain time stated in their contract.
Frank and Carl had a contract with Nicky’s Novelties stating a date they needed the goods by; they should have not accepted the goods if they arrived after this time and sent them back. According to the Sales of goods act 1979 it is a breach of warranty/condition so they would have to pay invoice then seek damages i.e. money lost if they had to sell off t-shirts cheap. The conditions of the contract were breached and therefore it could be considered an end of contract and receive a refund. Condition is an important term, if broken; the injured party can say the contract has ended. Whereas warranty means if broken the injured party must go on with the contract, but can sue for damages referring to the case of Bettini v Gye .
Mickey is a lawful visitor of the Dinky Duck Brewery and therefore is covered by Occupiers Liability Act 1957. A lawful visitor is anyone who enters premises with the permission of the occupier. If he was an unlawful visitor he would still be covered but under a different law - Occupiers Liability Act 1984. An occupier is anyone who has control over the premises that owes care to his lawful visitors as shown in Wheat v Lacon . According to the occupiers liability act