Law Essay

In the preceding month, Mig proposed his collection of British stamps, to Julian for £1000. Due to Julian's indecision, to enter into contract, the offeror, promised to leave the offer open for seven days. Still, reluctant to enter into a legally binding contract based on Mig's terms, "Julian sent a letter asking whether he would consider taking £800 for the stamps". This concluded in their sale taking place between Mig and Karen, a third party, who purchased the stamps at £1200.

In the aforementioned scenario, Julian felt there was a valid contract; on the grounds that his second letter, of acceptance was made before the time had elapsed, therefore it's legitimate.

His position can be governed under contract law, defined as a body of rules that governs both oral and written agreements associated with exchange of goods and money, amongst others. In order for a contract to come into existence, some essential elements of a contract need to be concurred on an equal consensus, between two or more parties. Otherwise the courts will be unable to enforce these agreements, if they are not content that the parties intended for them to be legally binding. The essay will analyse the following elements; intention to create legal relations, offer and acceptance, the postal rule, consideration and capacity to contract amongst others.

When assessing both parties' intentions to create legal relations; the courts will not be expectant to delve into the minds of these parties. Instead, "they will take a viewpoint in the outward appearances of a case, for example, the behaviour of parties and the overall context in which they made their agreement." As cited by Rush J and Ottley M (2006). The importance of context can play a major role, in the courts decision to treat an arrangement as being either business in essence or social and domestic. This is known as presumptions, and it can differentiate between agreements based on trust, which carry with them a moral obligation, as oppose to agreements based on intention to create relations, which require enforcement by court.

Since, Mig is not in the business of selling stamps. It can be deduced that the stamps are of his personal belonging. If Karen, were to be Julian's sister per se. That being the case, a relationship could be called into questioning between all three parties, giving rise to a domestic agreement taking place, the presumption for which is similar to the case relating to Coward v MIB [1963]; "Coward paid the friend a minimal weekly sum to take him to and from work each day. The court passed judgment that there was no contract of hire or reward, as it was a social and domestic agreement and subsequently, contained no intention to create legal relations. The widow was left entitled to no compensation."

An offer is a transparent and irrefutable proposition by one party (offeror), which is intended to be binding,