Consideration is basically the price that is paid in conjunction for the promise of the other party, it doesn’t necessarily have to be in the form of money but can be some form of a right, interest or benefit. Intention to create legal relations is another element as it is the parties who have agreed to the contract must have to intend to enter into the legally binding state. Legal capacity is also important and must be taken into consideration as not all people are completely free to enter into a legal contract, some people who are not eligible to do so include; people who have mental impairment, minors, bankrupts and prisoners. The last element is legality which is important as it refers to the actual contract, if its legal, thus if not then then there can be no contract between the two parties.
In case study 1, we are presented with a simple bi-lateral contract in which one party has exchanged a promise for another party in this case “Guy” has promised Nadia with a car in the exchange for money from her. Nadia has been promised a Sports car which is in perfect condition mechanically in exchange for $10 000. This agreement was reached verbally and involved no written contract/agreement between the two parties. Upon receiving the car Nadia has discovered that the promises and information provided by Guy are completely …show more content…
The problem that arises from the agreement between the two parties is that Guy had promised that the car was of good working condition and thus this was placed as part of the verbal agreement of which he and Nadia agreed to. This turned out to be false and created a voidable contract as the agreement is present but the contract avoided due to parts of the contract not being met.
It must be considered that simply because the terms of the contract cannot be found from the agreement made it does not mean that a binding agreement was arrived at and met. The whole case should be looked at to determine if a contract had been reached. In this case the evidence present demonstrates that the case does not represent a settled contract. In such a case Nadia is eligible to take action sue for breach of agreement in the attempt to sue Guy for specific performance and in which she would attempt to receive and return her money back due to what she had expected not being met, this is not a definite way of receiving money back and/or compensation but can be made by the plaintiff in the attempt to resolve the case between two