Explain how the law approaches issues of consideration, capacity and intention to create legal relations in a contract.

1. You should write this assignment report style, although a formal report structure will not be required.

2. You should use case law and statutes (Acts of Parliament/Regulations) to support your answers.

3. You should include a reference list and a bibliography using the Harvard referencing system.

4. It is advised that you write your assignment within approximately 3500 words

BELOW

Task 1 – Be able to apply the elements of a contract in business situations.

Ralph, a dealer in vitamins, advertises in a local newspaper that anyone who buys and takes his vitamins twice a day for three months and then once a day after the three month period will not contract the flu while taking the vitamins. Anybody who catches the flu after following the instructions exactly is entitled to a full refund. James reads the advertisement, purchases the vitamins and takes the vitamins as described in the newspaper advertisement. Unfortunately he catches the flu. He has this confirmed by a blood test. James wants a refund as advertised in the newspaper.

Armando employs Olaf as his personal assistant. Olaf’s contract specifically states that Olaf is to perform any administrative task that Armando requires of him. Armando offers to pay Olaf £500 extra for typing a letter for him.
Harriet falls over in the street and breaks her hip. Harriet is admitted to hospital. Her treatment is paid for by the State. She offers to pay her doctor £3,000 for his medical treatment of her.

1a. Explain all requirements for the formation of a valid contract. Apply the rules of offer and acceptance to Ralph and James.  Use case law to illustrate your answer.

1b. Identify and describe types of contracts which to be valid require extra formalities in addition to the essential requirements of a contract.

1c. Explain how the law approaches issues of consideration, capacity and intention to create legal relations in a contract. Use the examples from the scenarios above and case law to illustrate your answer.

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Task 2 –  Be able to apply the elements of a contract in business situations

Olly books a weekend break at The County Hotel. He pays for the accommodation in advance. He checks in at the front desk. When he arrives in his room he sees a notice which says:
“The Country Hotel is not liable for loss of property or death or personal injury however so caused.”
Olly leaves his room and locks the door. When he returns he finds that his wallet has been stolen. The Hotel states that it is not liable for the loss.

2a. This is an example of an exclusion clause. Outline the key problems associated with exclusion clauses and explain how an exclusion clause becomes incorporated into a contract. You should use case law and statute to illustrate your answer.

2b. How do the Unfair Contract Terms Act 1977 and the Unfair Terms in Consumer Contract Regulations 1999 ensure that exclusion clauses are fair and reasonable?

2c. Will The Country Hotel be able to rely on this clause?

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Task 3 – Understand principles of liability in negligence in business activities

3a. For a successful claim in negligence, a claimant must prove:
? a duty of care exists;  ? the duty of care was breached; and ? the damage is both direct and foreseeable
Explain and illustrate with reference to cases what is required in establishing each of these requirements and outline the general defences to a claim in negligence.

3b. What is meant by the term vicarious liability? Explain the rules that the courts will apply in deciding if the blame for a negligent act can be shifted from the employee to the employer.

3c. In what ways is the legal relationship between the parties in tort different to the relationship in contract law?

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Task 4 – Be able to apply the principles of liability in negligence in business situations

Ria is a new maid at The Country Hotel. Ria’s manager is busy and has told Ria that she will have to start without any training. The training includes health and safety, chemical cleaner usage, socket location and using appliances safely. Ria explains she has never cleaned before but her manager insists she start straight away. Ria reluctantly agrees.

Before she starts cleaning the rooms Ria goes to the cleaning cupboard to get bleach.  As a joke the caretaker and another maid give Ria extra strong bleach rather than normal bleach. The bleach should not be used without protective clothing. Ria asks her manager whether she needs protective clothing. The manager, without looking at the bottle says “no, it is just bleach, get on with the cleaning”.

Ria puts the bleach in her cleaning cart and starts to clean the landing carpet with a vacuum cleaner. Ria cannot find a socket on the landing so plugs the vacuum cleaner into a socket in the nearest bedroom. As a result the cable trails across the top of the stairs. Olly runs out of his room to report his stolen wallet. He is not looking where he is going because he is cross. He trips over the vacuum cleaner cable and falls down the stairs. As a result he breaks his leg. Ria is jolted by the force of the pull on the vacuum cleaner cable and stumbles into her cleaning cart. The extra strong bleach falls off the cart, the lid breaks off as the bottle hits the floor. The extra strong bleach splashes on Ria’s legs. As a result Ria suffers burns to her legs.

Apply the rules on both negligence and vicarious liability to consider whether Ria and Olly would be able to claim for the injuries and damage they have suffered and against whom. Remember to consider the exclusion of personal injury clause as it relates to Olly given in Task 2. You should use case law and statute to support your answer.