The Legal Environment of Business Assignment Example | Topics and Well Written Essays - 1250 words

The Legal Environment of Business - Assignment Example Two parties are involved; the one providing an offer (offeror) and the one accepting or agreeing to the offer (offeree). As a first step, legal contracts require both parties to agree on the subject of the contract (Goldman and Sigismond 2010). After that, the parties agree for appropriate way the contract can be made. The process now enters into negotiation process where the offeror make an offer (promise) to the offeree (promisee). It is always required that when this takes place, the offer in the context should be seriously intended, be definite and well communicated to the promisee. Serious intention is the key to make the contract legally recognized, since without serious intention, the contract is regarded as a less binding agreement (Goldman and Sigismond 2010). An offer becomes legally accepted when it is devoid of subjective intentions such as secret inner feelings by the offeror. In most cases, the court to legally recognize offer and acceptance contract, the parties are re quired to have intentions that are clear and objective in nature. Moreover, the terms expressed in the agreement should be definite in nature, where specific aspects such as price, time, quantity, and quality should not be vaguely expressed. In addition, the offer must be communicated clearly between the parties involved especially the promisee who has to understand the contents of the agreement before accepting. Lastly, the process should reflect a regally recognized invitation process among the parties and not done through coercion (Goldman and Sigismond 2010). The difference between warranties and conditions Contract whichever type or nature is generally perceived to be either a warranty or condition. In most cases, understanding whether a contract is warranty or condition may be problematic but the courts usually establish the rules of construction of contracts that in most cases are used to resolve ambiguities. Therefore, are certain specifics, which can be looked upon, and hel p in differentiating warranty from condition. First difference between the two arises from the purpose, which they serve. Condition usually constitutes stipulation aspects that are necessary to the primary purpose of contract of sale (Geet and Deshpande 2008). On the other hand, warranty constitutes stipulations that are collateral in nature (subsidiary) to the main purpose of contract of sale (). Another difference is brought about by the issue of breach. When a condition is breached, the party that is aggrieved has the right to sue for damages and also enjoy the right to repudiate the contract (Geet and Deshpande 2008). On the other hand, when warranty is breached, the part that is aggrieved only enjoys the right to sue for damages and not right for repudiate. Further, when a condition is breached, it is sometimes treated as breach of warranty and the same cannot be applied to warranty when it is breached. Lastly, condition goes direct to the root or core of the contract, while wa rranty does not go direct to the root of the contract (Geet and Deshpande 2008). How mistake may affect a contract Contracts may be appealing at first instance they are created and may be viewed to be fine without mistakes. However, unlike the common and general mistakes, contract mistakes exhibit unique feature in that it has to do largely with mistaken assumptions that are related to contract formation