Tag: The Legal Aspects of Business

Concept of a Contract

A contract is an agreement that is enforceable by law. A contract therefore has legal implications for the parties who enter into a contract.  A mere agreement is not legally binding and therefore neither of the parties is liable if anyone breaks the agreement. What makes a contract different from an agreement? A contract requires…...

Characteristics of a Simple Contract

There must be offer and acceptance. The offerer is the party that makes the offer and the offeree is the person that the offer is being made to. There must a clear offer and clear acceptance for a contract to be binding. Consideration is the price paid by one party for the promise of the…...

Differences between a Simple & a Speciality Contract

A simple contract can be made orally, in writing or by the implications deemed from the actions of the parties.  A specialty contract must be signed by the parties sealed, for example with a company seal and finally it must be delivered. Examples of specialty contracts include: 1. Mortgages and leases for over three years…...

Difference between an Offer & an Invitation to Treat

An invitation to treat is not an offer but an invitation to bid or bargain for an item. For example, at an auction persons may bid on various items presented.  An invitation to treat also occurs also when goods are advertised for sale in the media or in shop windows. Goods in a shop window…...

Conditions under which Offer and Acceptance are Communicated

An offer must be very clearly made. An offer can be made to one person, a group or to the whole world. For example, offering a reward for a lost wallet is an offer to anyone finding the wallet.  In cases where there is a counter-offer the original offer is no longer valid.  A counter…...

Ways in which Contracts may be Terminated

Contracts may be brought to an end: (a) By performance of the parties i.e. each party completing his obligations as stipulated by the contract. (b) By frustration i.e. an event through no fault of the parties that make one party unable to perform the contract. For example:  if one party suffers a prolonged illness which…...

Validity of Contracts

Mr. Larry was delighted to see a 50% discount on his favourite brand of shoes at a shoe store 15 miles away. He took sometime off from work to travel to the store. When he arrived at the store he was told that that the brand advertised was sold out but he could choose from…...

Why Documentation is Necessary in Business Transactions

Business documents provide information needed for the business to function efficiently. Information is required for accounting purposes to ascertain whether profits or losses are being made. Documents are also needed as evidence for example orders placed for goods and payments made. Documents also provide information on commodities in stock and prices. Read more →...

Business Documents for Various Purposes

(a) Letter of Enquiry is sent by persons who wish to be informed of what goods and services and the prices of these that a company offers for sale. (b)  The company may resend either a quotation or a catalogue A catalogue is a booklet with a brief description and pictures of articles for sale.  …...

Information on Transport Documents

a. Import License This document gives a business permission to import goods into a county. It is used by governments to restrict the importation or to limit the amount of certain goods imported. Quotas are sometimes used to protect local industries as they specify the quantity of certain goods importers are allowed to import. b.…...