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Contents

Introduction....................................................................................................................................3
Objectives.......................................................................................................................................3
Assignment 1..................................................................................................................................4
1.

What are the key elements that are necessary for making a valid contract with reasons and

examine the situations that can reverse the effect of these elements?............................................4
2.

Describe different types of contract that U Hla can make with different people and different

organizations and mention types of contract or factors in a contract could affect the legal validity
of the contract.................................................................................................................................5
3.

How can U Hla distinguish the legal value of the various terms agreed in the contract?

Analyze the importance of each class of terms and explain the consequences where there are
breaches of contractual terms occurred..........................................................................................7
4.

What type of contract did ABC and GT made? Can GT refuse to supply when ABC order to

supply them? Does ABC have any right to claim against the GT under this tender?...................9
5.

Can all statement made before the contract is conclude has binding force when the contract is

concluded? What effect to do mistake and misrepresentation have on legal validity of the contract?
10
6.

Is there any contract left between Ko Ko and ABC? Discuss for both parties....................13

7.

Explain the role of third party who did not involve in the negotiation of contract or making a

contract? What are the exceptions of capacity to make a contract?............................................15


Assignment 2................................................................................................................................16
1.

What is Trot law under English common law? In order to sue successfully under the aspect of

negligence, what are the basic facts that the plaintiff shall prove? To what extend that the
defendant shall liable for any caused by his negligent act or omission in calculating the damages.
16
2.

Analyse the differences between negligence and contractual liability..................................18

3.

Describe two factors that contribute in the question of existence of duty of care for negligence

and exemption of that issue. Does the manufacturer of certain product and retailer of such product
own similar responsibility with regard to the product they supply to the customer?...................19
4.

Could Rain Flower car rental service escape their liability for the injury caused to Alfred?21

5.

Should Silver Mountain Co., ltd takes responsibility of the accident done by their employee?
22

6.

Do the warning sign creates an effective measure to prevent injury to the visitor of resort?

What is the legal status of the boy who swims in the river? Who would responsible for that
drawing?.......................................................................................................................................23
7.

To whom shall the blame be put to financial loss to Alfred and Xavier? What kind of liability

shall Floral and Partners audit firm have? Do you think an auditor should take responsibility for
their negligent preparation of audit report and should every professional such as a doctor or a
lawyer should hold the same liability? Gives reasons for your argument?..................................24
Conclusion....................................................................................................................................27
References....................................................................................................................................28

Introduction
Simply, law can be explained as a collection of rules which are mainly created by a
particular state or state government & the state, as an authority, is responsible for enforcing the
law made within its jurisdiction via using various kind of sanction. While talking about law we
should have a clear idea about three basic concept power, fascination & importance. Sources of
law are also importance which can be constitutions, statue, common law, administrative law,
equity etc. In business world, we use different kinds of law & law of contracts is one of the most
widely used business law which is basically used to understand future business related issues in
more predictable manner by people engage in contracts. Contract is basically a promise that
gives the official commitment that the law will be enforced.Judicial activism, which creates law
to be less predictable & more flexible, & judicial restraint, which makes law more predictable &
less flexible, is two important issues closely related to contracts that need to be defined properly.

Objectives

The assignment has four objectives. The first one is to understand the essential elements of
valid contract in a business context and the next is to be able to apply the elements of a contract
in business situation. And the third is to understand principles of liability in negligence in
business activities. The fourth is to be able to apply principles of liability in negligence in
business situations.

Assignment 1

1. What are the key elements that are necessary for making a valid contract with
reasons and examine the situations that can reverse the effect of these elements?

The Essentials of a Valid Contract


The essential elements of the formation of a valid and enforceable contract can be
summarized under the following headingsi.
ii.
iii.
iv.
v.
vi.
vii.

There must be an offer and acceptance, which is in effect the agreement.


There must be an intention to create legal relations.
There is a requirement of written formalities in some cases.
There must be consideration (unless the agreement is under seal).
The parties must have capacity to contract.
There must be genuineness of consent by the parties to the terms of the contract.
The contract must not be contrary to public policy.

In the absence of one or more of these essentials, the contract may be void, voidable, or
unenforceable.1
Offer and Acceptance
An offer must be distinguished from mere willingness to deal or negotiate. For example,
X offers to make and sell to Y calendars featuring Australian paintings. Before any agreement is
reached on size, quality, style or price, Y decides not to continue. At this stage, there is no legally
binding contract between X and Y because there is no definite offer for Y to accept until the
essential terms of the bargain has been decided.
An offer need not be made to a specific person. It may be made to a person, a class of
people, or to the whole world.
An offer is a definite promise to be bound, provided the terms of the offer are accepted.
This means that there must be acceptance of precisely what has been offered. For example, a
used car dealer offers to sell B a Holden panel van for $1,000, without a roadworthy certificate.
1 Dennis Keenan, Smith and Keenans English Law, 8th edition, 1986, English Language Society/Pitman

If B decides to buy the Holden panel van, but insists on a roadworthy certificate being provided,
then B is not accepting the used car dealers offer. Rather, B is making a counter offer. It is then
up to the used car dealer to accept or reject the counter offer.
A person can withdraw the offer that has been proposed before that offer is accepted. For
withdrawal to be effective, the person who has proposed the offer must communicate to the other
party that the offer has been withdrawn. To continue the example above, the used car dealer may
say to B that hell check with his supervisor and maybe a roadworthy certificate can be provided.
If, while waiting for a reply, B decides he does not want to buy the Holden panel van and he tells
the used car dealer of his change of mind, then there is no binding contract.
Acceptance occurs when the party answering the offer agrees to the offer by way of a
statement or an act. Acceptance must be unequivocal and communicated to the offer or: the law
will not deem a person to have accepted an offer merely because they have not expressly rejected
it.2

2. Describe different types of contract that U Hla can make with different people and
different organizations and mention types of contract or factors in a contract could
affect the legal validity of the contract.

Types of contracts
Face to Face contract
In this contract the terms and conditions are not in written form or oral form but it is on
the face to face. The contract will be terminated as soon as the conversation end unless there is
specifically mention that contract will accept in nears future.
Distance Selling
These contracts are also known as the consumer credit contracts. It includes the online
shopping online booking of hotels and online booking of airlines This contract has been
2 http://www.lawhandbook.org.au

terminated if the agreement copy has not been provided by the party and it also cancelled by the
party at the discretion of them.
Written contract
Under the written contract the terms and conditions are in the written form. These are
used as evidence. It also make assurance that contract is existed in the offeror and offeree.
Contract by conduct
It is the non-verbal contract in which the contract is made through the conduct of the
parties. It is the implied agreement.
Unilateral Contract
A person accepts an offer by performing a requested act. The terms of the offer must
clearly indicate that an act is required for acceptance. Example: Mg Mg tells Ko Ko that he will
pay Ko Ko $100 if Ko Ko paints his car, and that Ko Ko should show acceptance of the offer by
the act of painting the car. Ko Ko accepts by painting the car.
Bilateral Contract
A person accepts an offer by promising to do the requested act. Example: Red Company
offers to buy 100 widgets from Green Company for $100. Green Company promises to deliver
the 100 widgets to Red Company.3
Void contract
A void contact imposes no legal rights or obligations upon the parties and is not enforceable by a
court. It is, in effect, no contract at all.

Voidable contract

3 http://www.slideshare.net

A voidable contract is a legally enforceable agreement, but it may be treated as never


having been binding on a party binding on a party who was suffering from some legal disability
or who was a victim of fraud at the time of the execution. The contract is not void unless or until
the party chooses to treat it as such by opposing its enforcement. A voidable contract may be
ratified either expressly or impliedly by the party who has the right to avoid it.4

3. How can U Hla distinguish the legal value of the various terms agreed in the
contract? Analyze the importance of each class of terms and explain the
consequences where there are breaches of contractual terms occurred.
The terms of contract
1. Conditions terms
For enter into the contract it is the most important term through which the parties are
enter in to the contract. The conditional term laid down all the conditions of the contract which
has to be performing or not perform by the parties in the contract. If any party breach the
conditional term in the contract then injured party has the right to file suit in the court for the loss
he suffers due to the breach.
In the case of Poussard v. Spiers
Poussard agreed to sing in an opera throughout a series of performances. Owing to illness
she was unable to appear on the opening night and the next few days. The producer engaged a
substitute. When Poussard had recovered the producer declined to accept her services for the
remaining performance.
Held: the failure to sing on the opening night was a breach of condition which entitled the
producer to treat the contract for the remaining performance as discharged.5

4 http://legal-dictionary.thefreedictionary.com/Types+of+Contracts
5 Poussard v Spiers (1876) 1 QBD 410

2. Warranties
It is not so much important as the conditional term. If any party breaches the warranties
then injured party has the right to claim the damages but the contract is not destroyed on this
part.
In the case of Bettini v. Gye
An opera singer was engaged for a series of performance under a contract by which he
had to be in Landon for rehearsal six days before the opening performance. Owing to illness he
did not arrive until the third day before the opening. The defendant refused to accept his services,
treating the contract as discharged.
Held: The rehearsal clause was subsidiary to the main purpose of the contract.6
3. Innominate terms
Innominate terms are condition and a warranties term which is applicable by the parties
in the contract in past but at the time of dispute court did not recognized the term which is used
by the party then court will treat the term as the innominate term.
4. Exclusion clause
Exclusion clause is that in which the breaching party limit the liability of the damages. It
is necessary to communicate the other party when they are entering in to the contract. There are
three types of exclusion clause:
True
Limitation
Time

6 Bettini v Gye (1876) 1 QBD 183

5. Express term
Express terms are those terms which are expressively mentioned in the contract. Both
parties are aware about all the terms of the contracts. It is the discretion of the party that they laid
down in either oral or written form.
6. Implied terms
Implied terms are those in which terms and conditions of the contract are not stated For
example, if a passenger gives one hundred kyats to the bus conduct, without saying anything, the
bus conductor gives him a ticket which cost hundred kyat. It is misleading to label as an implied
contract one that is implied in law because a contract implied in law lacks the requisites of a true
contract.7

4. What type of contract did ABC and GT made? Can GT refuse to supply when ABC
order to supply them? Does ABC have any right to claim against the GT under this
tender?
ABC and GT made valid contract according to the Dennis Keenan the essential element of
the formation of a valid and enforceable contract can be summarized under the following
headings,
-There must be an offer and acceptance which is in effect the agreement
-

There must be an intention to create legal relations

There is a requirement of written formalities in some cases

There must be consideration

The parties must have capacity to contract

There must be genuineness of consent by parties to the terms of the contract

7 http://www.slideshare.net/DavidMark15/aspects-of-contract-and-negligence-for-business?
related=1

The contract must not be contrary to public policy8


According to the scenario ABC had ordered wide range of material for several times and

GT was able to fulfill the orders for the time being. But drastic changes in foreign exchange rate
turn the situation down. So GT not longer want to supply for ABCs orders while the latter
already made three demands. So GT can refuse to supply when ABC order to supply them.
According to the scenario GT General Trading Company limited submitted a tender in
these works that I undertaken to supply the company at fixed prices for 12 months with such
quantities of construction material. So ABC accepts the tender. But drastic changes in foreign
exchange rate turn the situation down. So GT not longer want to supply for ABCs orders while
the latter already made three demands. But ABC have right to claim against the GT under this
tender by doing given more money according to the foreign exchange rate and claim to supply
construction material for 12 months.

5. Can all statement made before the contract is conclude has binding force when the
contract is concluded? What effect to do mistake and misrepresentation have on
legal validity of the contract?
Mistake
A mistake of fact occurs when a person believes that a condition or event exists when it
does not. A mistake of law is made by a person who has knowledge of the correct facts but is
wrong about the legal consequences of an act or event. A mutual mistake arises when two or
more parties have a shared intention that has been induced by a common misbelieve.
Mistake in contract can be broken down to into the following four categories:
1. Common Mistakes
2. Unilateral Mistakes
3. Mutual Mistakes
4. Mistakes relating to Identity 9
8 Dennis Keenan, Smith and Keenans English Law, 8th edition, 1986, English Language Society/Pitman

Mistake of Law
A misconception that occurs when a person with complete knowledge of the facts reaches
an erroneous conclusion as to their legal effect; an incorrect opinion or inference, arising from a
flawed evaluation of the facts.
Generally, a mistaken belief about a law is no defense to a violation of that law. All
persons are presumed to know and understand the law, except minors, persons who lack mental
capacity to contract with others, and, in criminal cases, persons who are insane. There are,
however, a few other rare exceptions to this general rule.
A mistake of law may be helpful to criminal defendants facing prosecution for a specificintent crime. A specific-intent crime requires that a defendant act with a criminal intent beyond
the general intent required committing the act. Murder, for example, is a specific-intent crime.
The prosecution must show that the defendant specifically intended to kill the victim without
justification. Manslaughter, conversely, requires only a showing that the defendant intended to
do those actions that caused the death. If a defendant is charged with a specific-intent crime, the
defendant's reasonable mistaken belief about the law may reduce the defendant's criminal
liability.
For example, assume that a defendant is accused of robbing another person. Assume
further that the defendant was actually trying to retrieve money that the alleged victim owed to
the defendant. A court may hold that the defendant mistakenly believed that the law allows SelfHelp in such situations and that the mistaken belief about the law negated the Specific Intent
required for the crime. That is, the defendant did not have the specific intent to gain control over
the property of another person. Generally, a mistake of law is helpful to criminal defendants only
in specific-intent cases. For general-intent and Strict Liability crimes, a mistake of law is no
defense.
There are other exceptions to the general rule that ignorance of the law is no excuse. If a
defendant relied on a statute that permitted a certain act and the act is later made illegal, the
defendant cannot be prosecuted. This applies to general-intent and strict liability crimes as well
9 http://www.inbrief.co.uk

as specific-intent crimes. If a defendant reasonably relies on a judicial decision, an opinion, or a


judgment that is later reversed, the reversal does not retroactively make a related act illegal.
Similarly, if a defendant acts with reasonable reliance on an official statement of law in an
administrative order or from an official interpretation by a public officer or government agency,
the defendant may use the mistake-of-law defense. Mistaken advice from an attorney, however,
does not create a mistake-of-law defense.10
Misrepresentation
A misrepresentation is a false statement of fact or law which induces the represented to
enter a contract. Where a statement made during the course of negotiations is classed as a
representation rather than a term an action for misrepresentation may be available where the
statement turns out to be untrue.
Example: Krysa v. Payne
There are several civil causes of action regarding the formation of a contract. A contract
won't be enforced if it's based on fraud or misrepresentation. Both of these causes of action
involve a statement of facts that is untrue. Let's take a look at a fairly well known contract law
case that involves fraud and misrepresentation. It's a 2005 case from Missouri. Shelly and Frank
Krysa needed a new car. They were looking for a dependable truck that had room for their whole
family. After several trips to Payne's Car Company, they found a 1991 Ford F-350 pick-up truck.
Interestingly, the truck was parked at the back of the lot and running when they saw it.
They were told the battery was recharging. They also noticed that the hood was a different color
than the rest of the car. They were told not to worry, that the truck was in perfect condition, and
that it was a trade-in vehicle that had only one previous owner. This was all good news for the
Krysa family.
The Krysas bought the truck. They used the truck but quickly noticed several severe
problems, including a smashed radiator, difficulty in starting and even broken glass under the
seats. The Krysas decided they should get a CARFAX report for the truck. The report showed
that the truck had 13 previous owners, when the Krysas were told there was only one. The
10 http://legal-dictionary.thefreedictionary.com

Krysas went back to the dealership to complain, and Payne's admitted there were problems with
the truck. Payne's offered the Krysas a credit toward the purchase of a different Payne's vehicle.
The Krysas were worried about the history and safety of Payne's cars and so they declined
Payne's offer.
The Krysas then hired an automotive expert to look at the truck. The expert noticed that
the truck was actually two different vehicles. The two vehicles had been welded together. The
expert told the Krysas that the truck was unsafe and they shouldn't drive it. The Krysas then sued
Payne's for fraud and misrepresentation. So, what are fraud and misrepresentation? And what did
the court think about the Krysa's case? 11
Non-disclosure agreement
A non-disclosure agreement also known as confidentiality agreement, confidential disclosure
agreement, proprietary information agreement, or secrecy agreement, is a legal contract between
at least two parties that outlines confidential material, knowledge, or information that the parties
wish to share with one another for certain purposes, but wish to restrict access to or by third
parties. It is a contract through which the parties agree not to disclose information covered by the
agreement. An non-disclosure agreement creates a confidential relationship between the parties
to protect any type of confidential and proprietary information or trade secrets.

6. Is there any contract left between Ko Ko and ABC? Discuss for both parties.
Contract terms can be defined as "Any provision that is part of a contract." Each term gives
rise to a contractual obligation and the breach of which may lead to litigation. All terms are not
expressly indicated but some terms carry less legal gravity because they are peripheral to the
goals of a contract.
Implied terms
Implied terms are the terms in which it has not been mentioned by any of the parties,
however, included in the contract, because the contract often has no commercial sense without
that term.
11 http://study.com

Express Terms
Express terms can be defined as the terms that have been specifically mentioned and
agreed upon by both parties at the time of making the contract and can be either orally or in
writing.

Important and the impact of broken Terms


The importance of a term can be clearly understood by explaining the contract. So, if an
agreement is finally put in writing, then it is more likely to be a term of the contract the
statement. The general rule is that the party is bound by all the terms of a contractual document
once signed. This applies if you have read and understood the terms or not.12
It left no contract between Ko Ko and ABC. Because according to the stage of ABC also
it conducts financial program called lease-purchase for the car. They sell cars through car dealers
in different conditions provided that any sale is only made when the company ratify the
agreement with the buyer. During the season of promotion that allow the customer for 5 days to
test drive after making an initial payment, but the buyer must return the car as received. Ko Ko
brought a car dealer City Express engine one of the dealers that connected with ABC making a
first installment on January. In January 15:45 third car was returned to City Express did not
satisfy the conditions of the car. City Express and sends the offer of Ko Ko and money to ABC
1:45 hours earlier. On the night of January 3 the car was stolen and found to be wrong on the
night of January fourth. January fifth Ko Ko minds the company to return to their delivery, while
ABC Ko Ko ratify the offer and asked him to make the full payment for the car.

12 http://www.lawteacher.net

7. Explain the role of third party who did not involve in the negotiation of contract or
making a contract? What are the exceptions of capacity to make a contract?
The role of third party in the negotiation of contract
In general third parties cannot sue for the carrying out of promises made by the parties to
a contract. Thus, if a contract between A and B requires B to benefit C, the privity rule prevents
C from suing B. However, A may sue B if B breaks the contract and the court may award C
damages or may grant a decree of specific performance under which B must perform the contract
for the benefit of C. If A and C are, in fact, both parties to the contract with B then C still cannot
sue B unless he has provided some consideration. Merely being a party to the contract is not
enough. Even through C may be named in the document, if any, which records and constitutes
the contract between A and B, or may be a party to their oral deliberations, if he does not
undertake anything in return for a promise from A or indeed from B, then he is not participating
in a bargain the belief that the privity rule is merely an aspect of the rule that consideration must
move from the promise.
The Legal Capacity of a Contract
The contracts that a business enters into with its customers and other individuals are
important to its long-term growth and profitability. However, certain individuals lack the
capacity or legal ability to enter into contracts. The law defines who these people are and
prevents other individuals and businesses from having valid contracts with those who are said to
lack capacity.
When two people enter into a contract, six elements must be met. Those elements
include:
i.
ii.
iii.
iv.
v.
vi.

Offer that specifically details exactly what will be provided


Acceptance (the agreement by the other party to the offer presented)
Consideration (the money or something of interest being exchanged between the parties)
Capacity of the parties in terms of age and mental ability
Intent of both parties to carry out their promise
The object of the contract is legal and not against public policy or in violation of law

The element we will focus on is capacity, and it means a person's legal ability to enter into a
contract. To best explain who can enter into a contract, let's use some examples of who is
forbidden to enter into a contract. 13

Assignment 2

1. What is Trot law under English common law? In order to sue successfully under the
aspect of negligence, what are the basic facts that the plaintiff shall prove? To what
extend that the defendant shall liable for any caused by his negligent act or omission
in calculating the damages.
A tort is a legal wrong, for which the law provides a remedy. It is a civil action taken by one
citizen against another and tried in court. A person who sustains injury or suffers pecuniary
damage as a result of the wrongful act of another person is known as the plaintiff and the person
who is responsible for inflicting the injury and incurs liability for the damage is known as the
defendant or tortfeasor.
The law of torts derives from a combination of common-law principles arising from case law
and legislative enactments. It can be distinguished from actions for breach of contract simply on
the basis that tort actions are not dependant on any agreement between the parties to the lawsuit.
While criminal prosecutions are enforced by the police and brought by the government, tort
actions are brought by private citizens. As action is brought by a private citizen, tortfeasors will
not receive fines or be sentenced to prison through civil courts, but are likely to be compelled to
pay damages to the plaintiff if the court rules in the plaintiffs favour.14

13 http://smallbusiness.chron.com

14 http://findlaw.co.uk

Negligence
It is the situation in which person fails to exercise the care at the reasonable
circumstances. In tort law if any person do this wrong is known as negligence, but the harm
made by the person is without intention of the defendant. If plaintiff proves that he suffers any
injury due to the negligence of the individual then he will be compensated by the damages for
the harm he suffers any loss of financial status, in intimate relationship. It is necessary for the
compensation that plaintiff has to prove that he suffers loss. The elements which are necessary
for the negligence
1. Duty of care
Duty of care is that in which the manufacturer is liable for the consumers for the product
they manufacture. Case- Donoghue v Stevenson [1932] in this case the plain tiff drank the ginger
beer which is brought form the shop by his friend. The beer is supplied by the David Stevenson
in Scotland. When they drink the beer they find out the decomposed snail in the beer bottle
which came out from the bottle. She files suit against the manufacturer of the beer bottle as there
is no contractual relationship between them as his friend made the payment. So as there is no
contract between them but privet action is taken against the Stevenson.
2. Breach of duty
The person must be under the duty of care of the plain tiff. Breach of duty is not limited
by the professionals or persons under the written or oral contract. The society member is also
under the duty of care towards other property.
3. Direct cause
If any person suffers any direct cause then defendant is liable for the injury, but is
necessary that particular acts or omissions are caused due to the negligence of the defendant.
4. Remoteness of damages:

According to wagon mound case (No.1) the ship owner told the wharf owner that oil was
spilled in the ship and stop the welding works but he ignore the none sparkle fall on the cotton
which was filled with the oil and fire is burned. According to UK House of Lords the wharf
owner is also under the contributory negligence which is also responsible for the fire. So the
ship owner is not liable for the act.
5. Harm and damages
The plain tiff has to prove that he suffers injury due to the defendant actor omission.
Plaintiff cannot cover the loss until he proved the loss which he suffers. Case: Constantine v
imperial Hotels [1944] Damages are given by the defendant and it will be in monetary value on
the harm which is made by the defendant to the plaintiff
The plaintiff has to prove these elements for taking the damages which he suffers.15

2. Analyse the differences between negligence and contractual liability.


According to the Prabhat P liability is responsibility whereas negligence is a lack of
responsibility. If someone is liable for the damage to car, it means that they have done something
wrong by which they had brought about the damage. Negligence means an injury or accident
caused by someone for not doing something in a proper way. For example, an accident involving
drunk driving is negligence.
Liability can also be defined as a cause that leads to negative results. In legal terms, liability
does not mean that there is a conscious decision or effort to create an injury or accident which
could lead to any harm. In legal terms, negligence is defined as the lack of care or concern of
persons to take essential steps to address certain dangers or hazards.
Negligence is also defined as the careless conduct that could create liability. It can also be
called a failure to behave as a responsible person.
Legal liability arises from three legal wrongs such as a tort, crime and breach of contract. A
tort is a wrong committed against organizations or people causing a loss to them. Crime includes

15 http://www.slideshare.net

murder, rape, robbery, theft and more like that. Breach of contract is a condition in which a
contract or agreement is not addressed.
A court will award damages in the case of negligence if it satisfies the requirement that there
was failure to perform a duty if the plaintiff had suffered loss or injury because of the negligent
act. Liability is responsibility whereas negligence is lack of responsibility.
1. Negligence means an injury or accident caused by someone for not doing
something in a proper way. Liability can be defined as a cause that leads to
negative results.
2. In legal terms, liability does not mean that there is a conscious decision or
effort to create an injury or accident which could lead to any harm.
3. In legal terms negligence is defined as the lack of care or concern of persons
to take essential steps to address certain dangers or hazards.
4. Negligence is also called the careless conduct that could create liability.
5. Legal liability arises from three legal wrongs such as a tort, crime and breach
of contract

A court will award damages in the case of negligence if it satisfies the requirements that there
was failure to perform a duty if the plaintiff had suffered loss or injury because of the negligent
act.16

3. Describe two factors that contribute in the question of existence of duty of care for
negligence and exemption of that issue. Does the manufacturer of certain product
and retailer of such product own similar responsibility with regard to the product
they supply to the customer?
Res ipsa loquitur
In the common law of torts, res ipsa loquitur is a doctrine that infers negligence from the
very nature of an accident or injury, in the absence of direct evidence on how any defendant
behaved. Although modern formulations differ by jurisdiction, common law originally stated that
the accident must satisfy the necessary elements of negligence, which are duty, breach of duty,

16 Dennis Keenan, Smith and Keenans English Law, 8th edition, 1986, English Language Society/Pitman

causation, and injury. In res ipsa loquitur, the elements of duty of care, breach, and causation are
inferred from an injury that does not ordinarily occur without negligence. 17
The Misuse of Drugs Act
This act is intended to prevent the non-medical use of certain drugs. For this reason it
controls not just medicinal drugs but also drugs with no current medical uses. Offences under
this Act overwhelmingly involve the general public, and even when the same drug and a similar
offence are involved, penalties are far tougher. Drugs subject to this Act are known as
controlled drugs. The law defines a series of offences, including unlawful supply, intent to
supply, import or export and unlawful production. The main difference from the Medicines Act is
that the Misuse of Drugs Act also prohibits unlawful possession. To enforce this law the police
have the special powers to stop, detain and search people on reasonable suspicion that they are
in possession of a controlled drug.18
Reasonable Person
To be negligent is to act, or fail to act, in a way that causes injury to another person. But
no one's perfect and accidents happen to the best of us. What separates a common accident from
an act of negligence, however, is the standard of care required in a given situation. By neglecting
the proper standard of care for a given situation, an individual may be found liable for any
resulting injuries.
For example, a motorist must exercise the same care that a reasonable person would in
the same situation, which includes obeying traffic laws and paying attention to pedestrians and
other drivers. But if a severely nearsighted driver who forgets to wear his glasses hits a
jaywalking pedestrian, he would be considered negligent because a reasonable, severely
nearsighted person would not drive without glasses or contacts.
The so-called reasonable person in the law of negligence is a creation of legal fiction.
Such a "person" is really an ideal, focusing on how a typical person, with ordinary prudence,
17 https://en.wikipedia.org
18 http://drugscope.org.uk

would act in certain circumstances. The test as to whether a person has acted as a reasonable
person is an objective one, and so it does not take into account the specific abilities of a
defendant. Thus, even a person who has low intelligence or is chronically careless is held to the
same standard as a more careful person or a person of higher intelligence.19

4. Could Rain Flower car rental service escape their liability for the injury caused to
Alfred?
According to the scenario Alfred and Xavier who are form UK have arrived Myanmar 2
days ago. Purpose of their visit is to explore Yangon and to establish Hotel and tourism business.
They rent a private vehicle from Rain Flower car rental service. Alfred holds international
driving license but he hasnt obtain verification from local authority. On the way back to their
hotel their car was hit by a cargo track of local construction company Silver Mountain. Both cars
were badly damaged. Alfred suffered an internal bleeding because the airbag didnt open on time
when the cars are collided. The lease agreement between them stated that the company shall not
be held responsible for any injuries caused to the renter by the negligence of the driver of the car.
But Rain flower car rental service could escape their liability for the injury caused to Alfred. The
negligence of Rain Flower car rental service reasonable about the airbag didnt open on time and
Alfred suffered an internal bleeding.
Negligence
According to the Dennis Keenan in ordinary language negligence may simple mean not
done intentionally, e.g. the negligent publication of a libel. But while negligence may be one
factor or ingredient in another tort, it is also a specific and independent tort with which are now
concerned.
The tort of negligence has three ingredients and to succeed in an action the plaintiff must show,
1. The existence of a duty to take care which was owned to him by the
defendant
2. Breach of such duty by the defendant
3. Resulting damage to the plaintiff. 20

19 http://injury.findlaw.com

Contractual liability
Liability imposed on an entity by the terms of a contract. As used in insurance, the term
refers not to all contractually imposed liability but to the assumption of the other contracting
party's liability under specified conditions.21

5. Should Silver Mountain Co., ltd takes responsibility of the accident done by their
employee?
Contributory negligence
Contributory negligence in common-law jurisdictions is generally a defense to a claim
based on negligence, an action in tort. This principle is relevant to the determination of liability
and is applicable when plaintiffs/claimants have, through their own negligence, contributed to
the harm they suffered. It can also be applied by the court in a tort matter irrespective of whether
it was pleaded as a defense.
For example, a pedestrian crosses a road negligently and is hit by a driver who was
driving negligently. Since the pedestrian has also contributed to the accident, they may be barred
from complete and full recovery of damages from the driver because the accident was less likely
to occur if it weren't for their failure to keep a proper lookout. Another example of contributory
negligence is where a plaintiff actively disregards warnings or fails to take reasonable steps for
his or her safety, and then assumes a certain level of risk in a given activity; such as diving in
shallow water without checking the depth first.22
Employee Liability

20 Dennis Keenan, Smith and Keenans English Law, 8th edition, 1986, English Language Society/Pitman
21 https://www.irmi.com
22 https://en.wikipedia.org

An employer is vicariously liable for the wrongful acts of an employee committed in the
course of that persons employment. In many circumstances liability will also be imposed on the
employer even if the employee has acted beyond the scope of employment.
1. An employer is always directly liable for its own negligence in hiring, training or
supervising employees.
2. An employer is always vicariously liable for the wrongful acts of an employee within the
scope of his or her employment.
3. An employer is always vicariously liable for wrongs committed by an agent in the scope
of the agents actual, apparent or usual authority.
4. An employer may be vicariously liable for an employees breach of fiduciary duty owed
to a previous employer even if the new employer to limit unnecessary liability is to take
proactive preventative measures.23
According to the scenario Alfred and Xavier way back to their hotel, their car was hit by a
cargo truck of local construction company Silver Mountain. The driver was drunk and claimed
that Alfred was driving wrong. Silver Mountain Co., ltd should take responsibility of the accident
done by their employee because company appoint and drive to the drunker.

6. Do the warning sign creates an effective measure to prevent injury to the visitor of
resort? What is the legal status of the boy who swims in the river? Who would
responsible for that drawing?
Children on premises
According to the Dennis Keenan dealings with children always demand a high degree of
care whether a person is sued in the capacity of an occupier of premises or not. However in the
case of an occupier of premises the duty towards children was rather different from the
corresponding duty to adults. If with knowledge of the trespass of children on his land the
occupier made no reasonable attempt to prevent such trespass by repairing fences and a child
was injured by something on the land which was especially alluring to children e.g. turntables,
escalators, bright and poisonous berries then the occupier in general was liable even though the
child was on the face of it a trespasser. The difference owed to child trespassers is no longer so
23 http://www.nolo.com

great in view of the broader rules laid down in the Occupiers Liability Act. However it should be
noted that what adequate warning to an adult is might not be so to a child.24
According to the scenario the site requires extensive development they have decided to
open the resort under the name of River View Resort Co. Ltd after completing the basic
establishment. They found out that the current of the river is not safety for visitors to swim so
they made a manager of the hotel to handle this issue and manger put a warning sign on the bank
but he did not employ any life guard. And they did not invite to come this bank. A young guest
who is age of 12 went to the river with being noticed by his family or staff or the resort and get
down. But he was saved by the local. That is young guest and his family negligence and his
family responsible for that drowning because River View Resort Co.ltd of manger put a warning
sign on the bank and they did not invite to come this bank.

7. To whom shall the blame be put to financial loss to Alfred and Xavier? What kind of
liability shall Floral and Partners audit firm have? Do you think an auditor should
take responsibility for their negligent preparation of audit report and should every
professional such as a doctor or a lawyer should hold the same liability? Gives
reasons for your argument?
Professional Negligence
If have been the victim of inadequate advice or improper conduct from a qualified,
professional person and lost out financially as a result, you may be entitled to make a claim for
professional negligence.
Professionals are legally bound to exercise a reasonable skill and care when dealing with
clients. If they fail to do this and their mistake was one that a reasonable professional working in
the same field would not have made, and the client lost money as a direct result of the mistake,
then they are liable for damages.
Disputes arising from professional negligence can involve all manner of professionals, including,

Accountants

24 Dennis Keenan, Smith and Keenans English Law, 8th edition, 1986, English Language Society/Pitman

Engineers
Architects
Barristers
Financial advisers
Insurance Brokers
Solicitors
Surveyors

Tax consultants
For a professional negligence claim to be successful, will need to establish the existence
of a duty of care on the part of the professional, and that t duty has been breached.
As mentioned above, the standard test of breach in professional negligence claims is
whether the defendant has matched the abilities of a reasonable person in the same profession.
If it is clear that the duty of care has been breached then it is also necessary to prove that
your financial loss came about as a direct result of the negligent professionals actions. It is only
possible to claim for losses that are reasonably foreseeable.25
Occupiers Liability
According to the Dennis Keenan the liability of occupiers of premises to persons
suffering injury thereon may be regarded as a further aspect of negligence. The occupier is the
personal who has de facto control of the premises or the possession of them it is a question of
fact in each case and does not depend entirely on title. It should also be noted that occupation
may be shared between two or more persons and that an employer may vicariously liable for the
torts of an employee who is acting within the scope of his employment. Thus in Stone v .Taffe
the owner of an hotel was liable when the manager failed to ensure that there was adequate
lighting on the premises so that a guest fell and was killed. 26

25 http://www.professionalnegligence-solicitors.co.uk
26 Dennis Keenan, Smith and Keenans English Law, 8th edition, 1986, English Language Society/Pitman

According to the scenario Alfred is now demanding Xavier to liquidate the company.
Before they invest in this resort project on river bank, local host called U Zaw Zaw owner of Jax
Development Co. Ltd persuaded them by submitting his audit report done by Floral and Partners
audit firm in order to prove his companys financial creditability and potential success of the
project. The firm negligently inserted a number of private properties of U Zaw Zaw under the
company holding without obtaining the title first. So Alfred and Xavier shall the blame be put to
financial loss. Floral and Partners audit firm have professional liability. I think an auditor should
take a responsibility for their negligent preparation of audit report.
Doctor or lawyer should hold the same liability.
Doctor liability
A doctor or a lawyer should hold the same liability. The legal concept of medical
malpractice is not limited to the conduct of medical doctors, but applies also to nurses,
anesthesiologists, health care facilities, pharmaceutical companies, and others that provide health
care services. The main thrust of a medical malpractice suit is proving fault often by a doctor or
someone else directly related to medical care but sometimes these other entities are liable as
well. This article focuses on who may be sued in a medical malpractice claim.27

Lawyer liability
In fulfilling professional responsibilities, a lawyer necessarily assumes various roles that
require the performance of many difficult tasks. Not every situation which the lawyer may
encounter can be foreseen, but fundamental ethical principles are always present for guidance.
Within the framework of these principles, a lawyer must with courage and foresight is able and
ready to shape the body of the law to the ever-changing relationships of society.28

27 http://injury.findlaw.com
28 https://www.law.cornell.edu

Conclusion
We use contract in many areas of our life starting from simple family issue to large business deal.
Thats why understanding the aspect of contract & negligence & its application in specific sector
of business is really important. This is more important in business perspective since court of any
country does not deal with invalid contract. A contract is considered as invalid only when it lacks
of any of the essential element required for the formation of a valid contract. The standard
developed by state law needs to be followed & efforts needs to be made to make sure that
negligence is not happening thats falling below the standard set by established law of the state.
The last but not the least thing we need to understand is that sometimes people get confused with
liability in tort & contractual liability but there are some basic differences between these two that
needs to be clarified precisely

References
https://www.academia.edu/8223826/Aspects_of_Contract_and_Negligence_for_Business
http://findlaw.co.uk/law/government/constitutional_law/tort-law.html
http://uk.practicallaw.com/8-380-8057
http://legal-dictionary.thefreedictionary.com/mistake
https://www.gov.uk/employment-contracts-and-conditions/collective-agreements
http://toolkit.smallbiz.nsw.gov.au/part/5/35/165
http://www.slideshare.net/DavidMark15/aspects-of-contract-and-negligence-for-business?
related=1

http://studyandjobs.com/the-aspects-of-contracts-negligence-for-business/