Table of Contents
INTRODUCTION 3
ABOUT THE CLIENT – THE WORLD AUTO LTD COMPANY 4
TASK 1.1 Explain the importance of the elements required for the information of a valid contract in the motor industry. 5
1.1.1. Agreement 5
1.1.2. Consideration 6
1.1.3. Intention to create the relations 7
1.1.4. Capacity 7
1.1.5. Privity of contract 8
1.2 Discuss the impact of different types of contract by providing explanations on comparison with local, export and distance buying modes 9
1.2.1. Written Contract 9
1.2.2. Verbal Contract 9
1.2.3. Distance Selling Contract 10
1.2.4. Modes of Contract 10
1.3 Analyze terms in contracts with reference to their meaning and effect in the motor industry 12
1.3.1 Condition 12
1.3.2 Warranty 12
For example, Jane ordered a car which was assembled by WAC. A valid contract had been created and signed by Jane and Thomas – supervisor of WAC in Vietnam on January 4th, 2013 after Jane agreed the price of W.O Co for the car as her custom. (Study case, 2014)
1.1.2. Consideration
In every single agreement, there must be consideration in order for the agreement to be legally binding; it is a critical part of contract formation. Consideration constitutes the benefit that you receive from making the contract. In other words, each person in a contract must promise to do something. In addition, consideration results in a benefit to each party. The failure to have consideration in an agreement can render the agreement unenforceable.
Consideration is the price paid for the promise of the other party. The price must be something of value, although it need not be money. Consideration may be some right, interest or benefit going to one party. Of course, the consideration must not be illegal or impossible to perform. Contract law consideration bases on the exchange promise between parties in contract and it also is a bound form in order to the promise, which has to have responsibility for that. (E-lawresources, 2013)
Executed consideration is one of all parties must do implement all the terms and conditions in contract. For example: The European factory offers supply the World Auto company a container