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Business law English leagal system Contract law

In the first scenario, it can be noted that The English National Operetta Company entered into a contract with Costumes R Us for the purchase of theatre costumes which were to be made according to designs supplied by the English National Operetta Company. All terms were agreed and the initial deposit was paid where the remaining balance will be paid upon delivery of the goods. Unfortunately, the premises of Costumes R Us were destroyed by fire before the delivery day. By any standard, this scenario represents a typical contract explained in the definition above. This type of contract involves the sale of goods and is governed by the Sale of Goods Act of 1979. Gibson (1988) suggests that the seller has a duty to deliver the goods purchased upon payment and the buyer has a duty to pay for the goods where ownership can be exchanged. The S.2(1) of The Sale of Goods Act 1979 concurs with this assertion and goes on to define a contract for the sale of goods as: ‘A contract by which a seller transfers or agrees to transfer the property (ownership) in goods to a buyer for a money consideration called the price.’ The contracting partners in this case are bound by certain conditions which are very important to the contract so as to protect the victim in the event of breach of contract which entitles him to repudiate and sue for damages. From this given scenario, it can be noted that there is a valid contract between English National Operetta Company and Costumes R Us. Legally, English National Operetta Company is entitled to claim for its refund of the amount paid following the failure by Costumes R Us to deliver the consignment before the date. Though it may be argued that this is a breach of a contract, it can be noted that to a greater extent, this scenario was a result of circumstances that were beyond the control of the suppliers of the costumes. Their premises were gutted by fire which was caused by the children playing so it would be unfair to lay the blame on them. This unfortunate incidence is what is normally called frustration of contract. Macintyre (2010) posits to the effect that the result of an event which occurs after offer and acceptance (the agreement) which prevents performance being carried out and which, as a consequence will terminate the contract legally with no risk to either party to be sued for breach. In this scenario, it will be unfair to say that Costumes R Us has breached a contract given that that the frustrating event involving the outbreak of fire is not the fault or a result of the actions of this organisation in question. It becomes impossible for the other party to fulfil their duty in the event of destruction of the subject matter of the contract for example Taylor v. Caldwell (1863). In such a situation, it is assumed that the contract has been cancelled naturally. Against this background, it is therefore advisable to English National Operetta Company not to sue this company for damages given that there will be likely chances that they will lose the case. It is the duty of the court of law to weigh the circumstances surrounding the frustration of the contract and come with an informed decision hence the chances of winning this case are very few. However, it is advisable that English National

Business law English leagal system Contract law