CONTRACT AND AGENCY LAW

Contract and agency Law

Contract And Agency Law

Issue

Contract laws are considered to be one of the most complicated laws. The issue in above mentioned scenario is that, the manufacturer who went bankrupt thus not able to supply parts to AirCon Central Pte Ltd. This has caused the point of discharge from the contract. The company cannot perform few elements of the contract. Usually, such cases are common in long term and service contracts. Given the length of time needed to fulfil the contract, the issues like such as discussed above become common.

Relevant Law

There are following Laws relevant to these cases.

Frustrated Contract Act indicates that contract becomes frustrate when either party has performed simply cancel the contract and relieving both parties from their obligations. According to Condor v The Baron Knights [1966] 1 WLR 87, “personal incapacity where the one party is significant may frustrate the contract.

Breach of Contract indicates that, “A party who seeks the judicial relief for a breach of contract may request the remedy of rescission (Tabalujan & Du Toit-Low, 2009). Court may order a rescission when a buyer made advance payment but never received a good in which seller would be required to refund he advance payment.

Sec 19.11.1 indicates that contract is considered as a Breach of Contract when one party is fully and partially complete its part.

Contracts Act Applies.

AirCon Central Pte Ltd claims that Frustrated Contracts Act applies in cases, but it will not relevant after analyzing the nature of case. The situation is not real because AirCon Central Pte Ltd can easily contact with other manufacturers who can supply goods to install air condition. The issues are existing between manufacturer and AirCon Central Pte Ltd, so there is no way to show excuse. Azizah can sue for damage in due to breach of contract.

Frustrated Contract occurs only when it is become impossible for either party to perform their duty as per requirements of the contract. Frustrated contract law applies to all the contracts which are started after the enaction of this law. The company's claim of contract to be “frustrated” is valid and justified. In such situation, the determination of price is not done by court. The pre-agreed terms and conditions apply for determination of consequences (Tabalujan & Du Toit-Low, 2009, section 3 (2)).

Application

Frustrated contract is not applicable to this case because AirCon Central Pte Ltd has enough time to manage goods from other manufacturer and fulfill the requirements of contract with their customers. Frustrated contract Law provides parties some relief if they have partially or completely performed their part. Application of any law is a complicated matter. Most of the time, provisions of a contract provide room for much debate. However, with proper clarification and implication of the terms and conditions, the level of dispute can be minimized. This law applies to the contracts which started after the commencement of this Law after 1st January 1959. This Act also applies to the government parties in the same ...