Signature Assignment: Contract Formation and Property
A contract is a legally, voluntary and deliberate binding consent between two parties or more that are competent. A huge number of contracts come in the form of written contracts, but they can also exist in spoken implied form. For the contractual relationship to exist between the parties involved, it has to adhere to certain elements. Such features include; it should have a valid consideration, an offer, and an acceptance of the offer in spoken/written. Once a contract is entered by the parties, they all acquire the rights as stipulated in the contract; however, the rights are not necessarily shared equally among the parties involved. Any party that fails to adhere to the contract agreement is subject to a legal case.
Elements of a Contract
Offer and Acceptance
The promise that is made to do or refrain from doing something in exchange for a pledge to act in the same manner is described as an offer. However, some offers have no anticipation for another promise to be reciprocated in exchange but rather the execution of an act or the restrainment from taking action (Agbonika, 2012). For the contract to exist between the two parties, the offer must be accepted by the other party. In the contract from the University of Phoenix website, it has an offer that is directed to both its employees and students. For the contract to exist between the parties involved, the students and staff must accept the offer by the University. The proposal by the University of Phoenix has been labeled as the Terms and Conditions in which it has various conditions set forth. In case the employees and the students do not concur with the terms and conditions of the University, the contract cannot be formed.
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Consideration
Consideration is the price that is paid for the pledge made by the other party. The consideration needs to be something that has value, and it should not necessarily be viewed in terms of cash. The considerations can be either an interest, right or benefit directed to one party. As long as there is the existence of consideration, the court cannot question its adequacy as long as it is of value (Agbonika, 2012). In this case, the University of Phoenix has laid down their Terms and Conditions to its employees. The consideration provided by the contract is that it allows the employees and students to access the University website. The staff and students have the right to access the University websites, and any other University-controlled websites irrespective of their IP features and address or domain name, and applications in connection with or accessible through the sites.
Mutuality of Obligation
In this element, it calls for both parties to have a mutual understanding and assent to the expression as per the agreement. The parties involved must agree to follow the same thing at the same time. For parties to have a mutuality of obligation, the offer must be clear, and the terms and conditions of the offer must be accepted (Agbonika, 2012). In the University of Phoenix contract, it apparently allows those parties that do not consent to the contract not to enter into an agreement with the University. This is because, in case a party gets into a contract with the university, and they do not agree on the same thing, and the same time, there will exist a conflict between parties most of the times. The contract has also clearly laid down its limitation of liability and disclaimer for the employees and students to understand the limits of the contract before signing it.
Application of Contract in Business Managerial Setting
In a business environment, the existence of agreements between firms and individuals is what makes them prosper. The business has to get into contractual relationships with its employees, financiers, employers, creditors, and debtors. Oral contracts can be used in some business operations, but most of them will require written agreements. This will allow them to have legal documents that will allow the company to solve any disputes that might arise between it and the parties within the contracts. Contracts can be useful tools that the business can use in safeguarding its resources and daily operations.
Termination
When signing a contract between a business and other businesses or employees, it should have an extermination clause. A contract that has no termination clause will not give the company the legal rights to end it in the case things do not go as expected. In case a supplying company has not been paid for the goods and services delivered; they will still be forced to continue supplying them in cases where a termination clause is void. The completion will see the business stop its operation with the said client company who might affect the financial obligations of the firm. At the workplace, some employees might develop bad working habits such as theft which requires necessary action including having them fired. In case the employee contract had no termination clause outlining what happens in case an employee does not follow the business rules, the employee can legally take the business to court and sue it for firing them.
Trademarks
A logo helps in the identification and distinguishing between the sources of goods or services of one party from the rest. Every organization must have its trademarks so that its products and services can easily be recognized by the customers. For a business to ensure that the logo is not copied by other companies, there is the need for the company to ensure it has protected it from other parties.
Potential Legal Defenses
Individuals have the right to bring forward a motion that dismisses the legality of a contract. Any contract must include a consideration, an offer and an offer acceptance. However, although most contracts offer all these elements, they might be enforceable if an individual can provide tangible defense to the development of the contract. In case the argument is valid, the court has the right to label the contract as unenforceable thus it becomes canceled, revoked or voided (Gray, 2009).
Capacity
This is the legal ability to form a contract. Individuals who are seen as minors, mentally ill, under the influence of drugs or legal guardianship do not have the legal capability to enter into a contract. In case someone enters into a contract with either of the parties, it becomes labeled as void.
Unconscionability
In case the terms and conditions of a contract are one-sided, oppressive and unfair; the court can declare the unconscionability defense as being valid. The court has to go through various elements in the contract and determine whether they are unconscionable. In case the conscience of the court is shocked, it declares the contract as an oppressive. Both parties in a contract should have equal footing, but even though it is not the case, they should not be oppressive (Gray, 2009).
Remedies for Breach of Contract
A breach of contract attracts various remedies such as restitution, an award of damages, rescission and specific performance. Most courts rule towards an award of damages in most cases. In case an individual would breach the University of Phoenix contract or vice versa, the following remedies will be granted (Pearce and Halson, 2008).
Damages
There are two types of damages that can be awarded to an individual in the case of a breach of contract. The first one is the Compensatory Damages. They cover the harms gained by the party who is victim of the contract breach. This amount awarded to the victim is meant to cover any losses the party gained after the breach. The individual is granted either general or special damages. The general damages are used in covering any losses that affect the non-breaching party directly after the breach. Special damages are used to cover any losses gained by the non-breaching party due to the exceptional situations or certain surroundings that are not typically predictable. This involves the actual damages brought about by the breach though not direct and instant way. For one to get these kinds of damages, the non-breaching party has to demonstrate that the breaching party was aware of the special situations or requests at the time of the contract signing.
Punitive damages are paid to punish the wrongdoers who acted willingly, fraudulently or in a malicious manner. Unlike the compensatory damages, punitive damages are used to punish the wrongdoer and ensure others do not behave in a similar fashion (Pearce, & Halson, 2008). In case an employee or student uses the trademarks that belong to the University of Phoenix for their private businesses, they will have to pay punitive damages to the university. This will prevent other users of the university site from using their trademarks.
Intellectual Property Issues
Intellectual property is the work or invention that results from someone’s creativity. To protect this task or invention, the individual may apply for a patent, trademark, copyright, etc. (Epstein, 2013). The University of Phoenix ensures that it has clearly protected its intellectual property. All the contents of the university site including the University texts, designs, logo, graphics, pictures, software, data, information, routines, sound files, technology, documentation, other files, and the assortment and arrangement are the proprietary property of the University. These intellectual properties are protected by international and U.S. copyright as well as other laws. The University does not give any individual who has access to its site the ability to use them in whichever way that benefits them. The license allows people to use the intellectual property only for educational, non-commercial and personal purposes.
Conclusion
Contracts allow for agreement creation, and they are enforceable by law. The basic elements making up a contract include capacity, legality, mutual consent and consideration. In case any of the parties that signed a contract breach it, the remedies include specific performance, general damages, reliance damages and consequential damages. All these solutions for the promise are provided for by law. Contracts allow organizations to minimize liability.
References
Agbonika, J. M. A. (2012). The Principle and Nature of Law of Contract in Nigeria: Formation of Binding Contract. Journal of Politics and Law, 5 (4), 123-128. doi:10.5539/jpl.v5n4p123
Epstein, R. A. (2013). Intellectual Property and the Law of Contract: The Case Against ‘Efficient Breach’. European Property Law Journal , 2 (3), 278-295.
Gray A. (2009). Unfair contracts and the consumer law bill. Queensland University of Technology Law and Justice Journal, 9 (2), 155-175.
Pearce, D., & Halson, R. (2008). Damages for Breach of Contract: Compensation, Restitution and Vindication. Oxford Journal of Legal Studies , 28 (1), 73-98.
