Describe about the Commercial Law for Binding Decisions.
For the formation of a contract, there are certain essentials like offer, acceptance, consideration, legal capacity and so on. Prior to conclusively determining as to when is a contract actually been formed between Alan on one side and Bernard or Charleen or Damien on the other side, one needs to consider the presence and application of all the essentials of a contract (CTI Logistics Pte Ltd v LAL Sahu Distribution Pte Ltd, 2009). There is no contract between Alan and Bernard because what Alan posted on his facebook wall was an offer to sell his book for $200. To this, a counter offer was made by Bernard that he intended to buy the book for $150. This was rejected by Alan and hence there is no acceptance of offer in this case. The fact that Bernard intended to buy the book for $200 was not communicated to Alan and hence there exists no contract between Alan and Bernard.
As far as Charleen is concerned, though Charleen is a minor, it can be said that there is a contract between Charleen and Alan. Charleen had expressed her desire to buy the book for the said price from Alan and Alan had agreed to her offer. Though he was absent minded when the acceptance was being made by him, yet, his acceptance in the matter is proof that both had agreed to enter into a contract (Delta Enterprise Building Supplies Pte Ltd v Samsung Corporation (Engineering & Construction Group), 2008). Thereafter, Charleen also paid the said amount to Alan and thus fulfilled the consideration aspect of a contract. Thus, it can be said that there exists a contract between Charleen and Alan.
Regarding Damien, it can be said that though he had not made any acceptance of the Facebook offer made by Alan, yet, he approached Alan with the amount of consideration that was decided by him and hence, in these circumstances, he fulfilled his part of obligations for entering into a contract (Anson et al, 2010). The consideration was also accepted by Alan and he agreed to deliver the book on a said date. These indicate that all the requirements of a valid contract are being fulfilled in this instance and hence there is a valid contract between Damien and Alan.
Bernard initially gave a counter offer to Alan that he intended to buy the book along with the notes as stated by Alan for $150. This counter offer was rejected by Alan and subsequently, after much of consideration, he agreed to buy the book for the said amount of $200. He communicated of his intention to enter into the contract to Alan after posting him the said amount in cash. The law says that the presentation of a proposal is comprehensive when it displays to the understanding of the person to whom it is executed (Poole, 2012). The communication of approval is assumed to be consummate as against the proposer when it is put in the course of communication to him so as to be out of acceptor power and as against the acceptor when it happens to the experience of the proposer (Goh & Phang, 2012).
In these circumstances, it can be said that when Bernard posted the acceptance on 4 Nov, 2015, his part of acceptance was done by him and when the letter reached Alan on 5Nov, 2015, he got intimated of the same. However, since, Alan had been informed about the matter previously, hence, his communication should be held to be the previous time only.
Thus, the presence of a contract from the part of Bernard in the matter is proved beyond any doubts which indicate that Alan is bound to enforce the contract and if he makes a breach, then he shall become liable thereon (Pang Giap Onn (alias Arif Peter Pang) v Harmesh Singh s/o Ram Singh, 2016). However, it should be noted that Bernard came to know that the book was made freely available in the University. He can claim that Alan had cheated him by selling him the book. But, what should be noted here is that Alan never mentioned that the price which he quoted was against the book only. He had made it clear that he intended to sell the book along with the notes that he had prepared in a separate exercise book. Alan in fact gave a copy of the book along with his self-made notes to Bernard. Thus, it can be said that the rights of Bernard have not been hampered here. However, Bernard can state that facts were concealed from him and the contract was made under misrepresentation in this case. This is because Alan took advantage of his position and charged Bernard for his class notes in the exercise copy and did not inform Bernard about it.
Charleen entered into a valid contract with Alan for purchasing the book along with the notes as stated by him in his offer on the facebook wall. This acceptance of the offer was also showed consent by Alan. Alan was not concentrating on the statements that were being made and unknowingly, Alan acceded to all that Charleen said. Whatever may be the situation of Alan in the given instance, yet it is beyond any doubt that Charleen had valid contract with Alan for purchasing the book and the notes for $200. However, Alan accepted other offers that he got after entering into a contract of sale with Charleen and ignored her from the picture thereby selling the book and the notes to other buyers. This indicates the breach of contract that Alan made in this matter. Thus, it can be said that Charleen can initiate a matter of breach of contract against Alan.
The law provides that when one party to the agreement ruptures the contract, the other party does not need to perform this obligations part. The aggrieved party has rights to rescind the contract. Since in the given matter, Charleen had paid her part of payment and given her consideration to Alan, she can now claim for compensation for the same from Alan (Mughal, 2012). She can claim her money back along with other pecuniary benefits associated with the matter.
Thereafter, the aggrieved party also has rights to get monetary compensation when a contract is breached. The purpose of the law is to put the aggrieved party in a position in which he would have actually been had the performance not been done by him. This calls for a situation where damages can be claimed by the aggrieved party. These damages are generally of four types. Those are as ordinary or general damages, special damages, punitive damages or nominal damages (Honey Secret Pte Ltd v Atlas Finefood Pte Ltd and others, 2016). Thus, in the given situation, Charleen can call for general damages in the matter from Alan.
A right to register a lawsuit for particular execution of the contract is also available in the hands of Charleen. This states that Charleen can in fact ask Alan to specifically perform the contract and execute the sale of the book in her favor. The courts in the matter are also supposed to grant for the claim of specific performance requested by her because she necessarily in the matter holds equitable grounds for doing so. However, it should also be noted that to claim for a executable specific performance, Alan should be able to prove beyond doubts in the court that there are no standards to ascertain her damages that she has incurred because of non-execution of the contract by Alan in her favor (Neptune Capital Group Ltd and others v Sunmax Global Capital Fund 1 Pte Ltd and another, 2016). She should also be able to prove that in case the courts grant her a compensation in the matter, then the compensation shall not be an adequate relief in the given situation and lastly, she should be able to show that she has completed a substantial amount of the contract and hence denying her the contract shall be against the principles of equity, good conscience and natural justice in the given matter against Alan (Furmston, Cheshire, & Fifoot, 2012).
Regarding the position of Damien, it can be said that the offer that Alan had made in his facebook wall was not accessible to him and hence it can be presumed that he was not given the offer. However, after he send Alan the SMS on is hand phone, there is no evidence that Alan agreed to his acceptance of Damien. Nevertheless, it should also be noted that Damien completed his part of the performance towards the contract on the date specified by him that is 4 Nov, 2015. Thus the moment consideration towards the contract was accepted by Alan; he too became bound with the contract and becomes liable to perform his part in the contract that was binding between the two (Neyers, Bronaugh, & Pitel, 2009). However, Alan stated that he would perform his part on 7 Nov, 2015. Thus this indicates that Damien could have expected that he would receive the book along with the notes prepared in the exercise book by Alan from him. However, the situation was not this, what Alan delivered to Damien on the said date was only the book and he said that the notes were written in the book itself. Thus, this can be said to be a breach of contract by Alan (Peter Teo Boon Kang v Tong Lian Joo alias Tong Djoe, 2013). Hence, Damien has rights to sue Alan for this breach of contract and thus claim for remedies in the matter.
The various remedies that Damien has in the matter are:
He can firstly claim for damages and call for redemption of his consideration forwarded by him because he had expected to get the book along with the exercise notes but he got only the book along with the written notes in the book indicating a clear breach of the terms of the contract .
He can also ask for specific performance of the contract because the hand notes of Alan would have been helpful for him to score well in the paper and the monetary compensation awarded to him in the matter would definitely not be sufficient enough to score those marks (L Manimuthu and others v L Shanmuganathan, 2016).
Hence, it can be said that Damien by way of his position has rights and remedies in the given matter as indicated above.
The parties here have options of different various dispute resolution mechanisms like mediation, arbitration and litigation. The advantages and disadvantages of each of them are being discussed in the subsequent paragraphs.
Mediation: In the process of mediation, there generally a neutral third party who helps in resolving the dispute by using specialized techniques of communication and negotiation. This is generally a party centered process that tries to uphold the needs, rights and interest of the parties. There are advantages of mediation because it is a cost effective method and has confidentiality. Outsiders would not have knowledge of the proceedings and the parties to the suit can hold the process under their control (Jiangsu Overseas Group Co Ltd v Concord Energy Pte Ltd and another matter, 2016). The extent of support and compliance is also effective in the process of mediation thereby upholding justice.
Arbitration: In arbitration, the parties to the dispute mutually agree that they would select a panel of single or more number of arbitrators who would assist them in resolving the dispute and the parties in turn would be bound by the award that is given by the arbitrators (Sinnadurai & Koh, 2009). The benefits of arbitration include that the parties are free to choose their arbitrator and the proceeding s are much faster as compared to court process. The award that is given by the panel is non-public and the parties are free to choose the language in which the proceedings would take place (Realstar Property Pte Ltd v Wong Seng Chak and Another, 2006). However, it also has certain disadvantages because in some instances, a single arbitrator might show biasness. The parties might also be forced to waive their rights in certain matters.
Litigation: This is another option that is available in front of the parties. They can choose to take the matter in the court of law and thus initiate litigation. An independent judge is appointed in the matter who decides the case after hearing the arguments of both the parties and also paying heed to the evidence given by them (Zhu Xiu Chun v Rockwills Trustee Ltd, 2016). Litigation is an integrated and formal procedure and has a binding decision.
References
Anson, W. R., Beatson, J., Burrows, A. S., & Cartwright, J. (2010). Anson’s law of contract. Oxford University Press.
CTI Logistics Pte Ltd v LAL Sahu Distribution Pte Ltd, SGMC 7 (2009).
Delta Enterprise Building Supplies Pte Ltd v Samsung Corporation (Engineering & Construction Group), SGMC 2 (2008).
Furmston, M. P., Cheshire, G. C., & Fifoot, C. H. S. (2012). Cheshire, Fifoot and Furmston’s law of contract. Oxford University Press.
Goh, Y. & Phang, A. (2012). The law of contract in Singapore. Wolters Kluwer Law & Business.
Honey Secret Pte Ltd v Atlas Finefood Pte Ltd and others, SGHC 164 (2016).
Jiangsu Overseas Group Co Ltd v Concord Energy Pte Ltd and another matter, SGHC 153 (2016).
L Manimuthu and others v L Shanmuganathan, SGHC 186 (2016).
Mughal, M. (2012). Law of Consideration in Contract. SSRN Electronic Journal. https://dx.doi.org/10.2139/ssrn.2167485
Neptune Capital Group Ltd and others v Sunmax Global Capital Fund 1 Pte Ltd and another, SGHC 148 (2016).
Neyers, J., Bronaugh, R., & Pitel, S. (2009). Exploring contract law. Oxford: Hart Pub.
Pang Giap Onn (alias Arif Peter Pang) v Harmesh Singh s/o Ram Singh, SGHC 149 (2016).
Peter Teo Boon Kang v Tong Lian Joo alias Tong Djoe, SGMC 5 (2013).
Poole, J. (2012). Casebook on contract law. Oxford University Press.
Realstar Property Pte Ltd v Wong Seng Chak and Another, SGMC 24 (2006).
Sinnadurai, V. & Koh, T. (2009). The law of contract in Malaysia and Singapore: Cases and Commentary. Kuala Lumpur: Oxford University Press.
Zhu Xiu Chun v Rockwills Trustee Ltd, SGCA 52 (2016).
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