Contract Law - Example of Problem Solving

Margritt Clouzeau

Contract Law Essay: problem solving

Word count: 1484

In this hypothetical case, different legal issues are raised. Those have to be solved in order to determine who, if any, is to be paid by Alain de Swan. The latter had promised to pay £10,000 to “any yacht who could cross the finish line ahead of [the Liquid Amber, his boat,] the next day”. The” Liquid Amber” was beaten by both the “Bell Raider” and the “Mon Amour”. Does Alain Swan owe money to the owners of these two yachts? To answer this, one has to analyse if there is a contract: an enforceable agreement between two or more people.

In order for a contract to be formed, there has to be an offer, an acceptance, consideration, and intention to be legally bound. The main issue of this scenario is to establish if there was a valuable agreement.

First, we have to analyze if, and how, a contract was formed. Therefore we have to identify where the offer and the acceptance have been made.

An offer is an expression, by one party, of a willingness to contract on specific terms, with the intention to be immediately bound upon acceptance. Here, the legal issue is to determine who the offer was made to. An offer may be addressed to one particular person, a group of persons or to the world.

It is clear that the offer was made orally by Alain de Swan in the bar. Alain de Swan addressed his offer to “any yacht who could cross the finish line ahead of his the next day”. Therefore, one could argue that it was a general offer, in the form of a unilateral contract; one opened to the world as in Carlill v Smoke Ball. The advertisement, set up by Smoke Ball Co., to pay anyone who contracted influenzia after using their product, was held to be an offer to the world at large. However, this scenario differs from Carlill v Smoke Ball; the Smoke Ball company knew anyone could see this advertisement in the street and decide to use their product. Alain only makes his offer to the yacht crews...