What is the concept of a contract and when can an agreement be termed as a contract?
The matter given here is about Henrietta and her engagement with a solicitor firm. She seeks relief from the firm regarding a personal disturbance causing her nuisance. The incident and her engagement explain that there was a presence of contract between them, and hence, they can be termed as the party to the contract.
Now the question arises that what is the concept of a contract and when can an agreement be termed as a contract? The answer to the question is that a contract is a legally enforceable agreement between two concerned parties with the presence of a willful consent and under goodwill (McKendrick 2014). The contract has different forms, but the fundamental rule of the contract is to have an offer and an acceptance of the proposal or the offer.
The agreement or the contract comes with the property of legal enforceability, so if there is an absence of the mentioned property, then that will turn into a breach of contract. Upon such cases, the concerned party is liable to compensate aggrieved party since the good faith is hampered and caused some amount of mental distress. A similar property is noticed in the given matter, where the clerk made the matter worse due to the incompetence and lack of experience that caused her mental distress.
The matter given here explains that Henrietta’s engagement with the solicitor firm makes them liable to dispose of the duty as promised under the clause of the agreement. Since the contract is legally enforceable hence the offeror becomes responsible to the offeree, (Furmston, et al. 2012). The act of the firm’s handling the matter to the inexperienced and unqualified clerk created a breach of contract. The act not only caused mental distress to Henrietta but also made the matter worse and her problem increased instead of attaining relief causing her mental distress.
The agreement occurred with the voluntary consent from Henrietta with the good faith that the problem will solve with the working of experienced people, but later the firm hampered her good faith. The similar situation is observed in the case of Alcatel Australia Ltd v Scarcella, where the court observed that there must be a presence of good faith during the formation of the agreement. The parties involved are expected to understand the terms of a contract and must be well informed about the clauses in clear language, and there must be an absence of doubt before the commencement of the agreement. The amendments intended to be well informed to the party before the commencement of the agreement which otherwise causes mental agony and harassment to the party. The famous matter of Balfour v Balfour decided at the high Court in Australia observed the same property of presence of an intention for creating an agreement.
As explained by (Chen-Wishart 2012), there is a presence of some vitiating terms in the contract. The vitiating terms of the contract are some of the negative factors in an agreement explaining the discussion of frustration, wrong assumptions, non-disclosure, duress and above all misrepresentation.
The primary concern of the debate in this matter regards the mental distress and the damage caused due to the breach of the disability required to explore the contract. The concept of the mental agony is put forward by different views of the scholar explaining various effects occurring from such mental distress.
As explained by (Taskar 2015), the claim presented by the party regarding the mental distress due to the unfulfillment of the responsibility and the duty gets imposed upon the concerned party who is responsible for such damage. The same factor observed in the matter of Addis v. Gramophone co. also in the case of Trans Trust S.P.R.L v. Danubian Trading Co, where the suggestion of the court’s decision explained about the availability of the damages caused due to the inconsistency from the party while disposing of duty towards the other party.
A very famous case of Bliss v. South East Thames Regional Health Authority took here for reference best suited to explain the situation of the matter of Henrietta. The court explained that for the party in mental distress there is an availability of the damages irrespective of what is described and mentioned as the terms of the contract. The court even explained that the damages get limited within a particular stage of the contract. The compensation for the mental damage should be in a form providing recovery of the mental distress and cause of agony to the aggrieved, (Cartwright 2014).
The fundamental principle is that the disability of the contract occurred because of the party’s inability to fulfill the liability as imposed and promised under the contractual agreement, (Willmott et al. 2013). It is a concept of mere rationalization of the breach of the contract where the inability causes agony and emotionally distressed.
However, the realm of the mental distress increases with the rationality of the inability. Vorvis v. Insurance Corporation of British Columbia, the court observed that some confusion were there that needed to be cleared regarding the concept of the distress and humiliation that falls under the liability for the covering damage in the form of compensation(Harder 2014).
The intention to mention the various cases is to relate the matter and observe as similar facts happen to Henrietta mentioned as the aggrieved party in the given situation. The mentioning of the case even holds the intention that she will come to know her rights under the damage caused due to the breach of contract. The corrective procedure will be same as in the case of the matters mentioned for referring the condition of Henrietta.
On support of the statements, the following facts to be mentioned as the rights of Henrietta from the solicitor firm due to the breach of contract:
1. The duty not performed with good faith and classified as the breach of contract. If the solicitor firm was not competent to provide the service as promised, they are liable to inform the same during the formation of the contract, known as the anticipatory breach. In such matters, the party may ask for partial damage compensation and has an assumption about the competency of the party. Exceptions can be there since there was an assumption beforehand and the party did not breach the promissory note in a full sense.
2. Delivering of the incomplete performance explains the lack of fulfillment of the contractual obligations as described by (Lando 2016). Breach of the performance causes the violation of a promise, and the aggrieved party holds the right not to accept such duty likely to extend the distress.
Henrietta asked for mental relief from an existing problem where the solicitor firm had a simple duty to apply for an injunction over the party causing distress to their client. The firm not only showed their incompetence but even made the matter worse by handling it to one of the inexperienced and incompetent clerk.
3. The act caused termination of the promise as mentioned conditions and damage due to the same factor. Any breach entitled from such damage results in the termination of the contract.
4. The warranty of the contract was not taken care, and the party had to face a prolonged distress.
5. Innominate terms: the concept explains the intensity of the contractual damage caused to the party involved in the contract. The intensity explains the extremity of the damage caused and its depth to reach damage to the aggrieved party, Koompahtoo Local Aboriginal Land Council v Sanpine Pty Ltd.
6. The given matter explains about the frustration in the contract. The frustration explained as the mental distress and increase of the tensions occurred due to the unfulfillment of the contractual obligations. The given matter is related to the concept of the frustration because the incompetency of the clerk increased the problem that Henrietta faced for a long time. The matter became even worse instead of getting recovered.
Conclusion:
Considering the facts as mentioned for the given matter about Henrietta, the basic conclusion that can be drawn from the case is that the court does not excuse the party that caused a deliberate mental agony to the concerned party in the contract. Every mental distress matters must be compensated for the part of the party that caused such damage. It even suggests about the evolving and growing aspect of the contractual obligations to give importance to the aggrieved party in the agreement.
The discussion in this matter explains about the intensity to understand the importance of the party in the contract. The introduction of the damage payment in the form of compensation has been mandatory so that the parties to the contract do not gets mislead with the terms and its interpretation. It is expected from the party to the contract must have a clear conception about the entire terms mentioned in the obligatory part and the language must be clear and any amendment of the terms are expected to inform the parties involved by the concerned party or the offeror. So, it is clear that Henrietta is liable to get the damages from the concerned solicitor firm. The concerned firm proved the incompetence by handling the matter to some inexperienced clerk further providing mental agony and worsening the condition of existing dispute.
References:
Andrews, N., 2015. Contract law. Cambridge University Press.
Ayres, I., 2012. Studies in Contract Law. Foundation Press.
Buell, S.W., DeMott, D.A., Cox, J.D., Young, E.A. and Lipton, A., 2014. Brief of Common Law Scholars as Amici Curiae in Support of Respondents.
Burrows, A., 2016. Illegality as a Defence in Contract. Available at SSRN 2758797.
Carter, J.W., 2012. Cases and materials on contract law in Australia. LexisNexis Butterworths.
Cartwright, J., 2014. Contract law: An introduction to the English law of contract for the civil lawyer. A&C Black.
Chen-Wishart, M., 2012. Contract law. Oxford University Press.
Corones, S.G., 2013. The Australian Consumer Law. Thomson Reuters, Lawbook Co..
Furmston, M.P., Cheshire, G.C. and Fifoot, C.H.S., 2012. Cheshire, Fifoot and Furmston’s law of contract. Oxford university press.
Gergen, M.P., 2013. Negligent Misrepresentation as Contract. California Law Review, 1, p.953.
Harder, S., 2014. Claims between a person liable for misrepresentation and the representee’s contract-partner. Journal of business law, (2), pp.121-139.
Lando, H., 2016. Optimal rules of negligent misrepresentation in insurance contract law. International Review of Law and Economics, 46, pp.70-77.
McKendrick, E., 2014. Contract law: text, cases, and materials. Oxford University Press (UK).
McLauchlan, D., 2015. Liability under Hedley Byrne for’pre-contract’negligent misrepresentation: a New Zealand perspective.
Poole, J., 2014. Textbook on contract law. Oxford University Press, USA.
Taskar, B.D., 2015. The Doctrine of Consideration.
Turner, C., 2013. Unlocking contract law. Routledge.
Willmott, L., Christensen, S., Butler, D. and Dixon, B., 2013. Contract law. Oxford University Press.
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