SITUATION BASED QUES ON LAW OF CONTRACTS & TORTS

1. Sarah and Alex are friends who often engage in friendly bets. One day, while watching a
football match, they make a bet where Sarah says, "I bet you $50 that the home team will
win." Alex agrees and says, "You're on!" Unfortunately for Sarah, the home team loses
the match. Alex asks Sarah to pay her $50, but Sarah refuses, claiming that it was just a
friendly bet and not a serious agreement. Does this situation constitute a legally
enforceable contract?
Answer: In this situation, the scenario might not constitute a legally enforceable contract due to
the absence of certain key elements required for a valid contract.
For a contract to be legally enforceable, it generally needs to meet the following criteria: offer,
acceptance, consideration, intention to create legal relations, and certainty of terms.
2. Sarah agreed to sell her antique car to Mark for $5,000. They both signed a written
contract, but before the deal could be completed, Sarah changed her mind and decided to
keep the car. Mark insists that Sarah is legally obligated to sell him the car as per their
contract. What legal principles apply in this situation?

Answer: In this situation, several principles of contract law come into play:
Offer and Acceptance: Sarah's agreement to sell her antique car to Mark for $5,000 constitutes
an offer. Mark's acceptance of this offer is evidenced by the signed written contract. Therefore,
the essential elements of offer and acceptance are present, forming a valid contract.
Breach of Contract: When a party to a contract fails to fulfill their obligations without a legally
valid reason, it's considered a breach of contract. In this case, Sarah's decision to keep the car
after entering into a valid contract with Mark constitutes a breach of contract.
Specific Performance: Mark may seek a legal remedy known as "specific performance." This
remedy involves a court order compelling Sarah to fulfill her contractual obligation to sell the
antique car to Mark for the agreed-upon price of $5,000. Specific performance is often used in
cases where the subject matter of the contract is unique or where monetary damages would be
insufficient to compensate the aggrieved party adequately.
Damages: Alternatively, Mark could seek monetary damages as compensation for Sarah's breach
of contract. The damages would aim to put Mark in the position he would have been in had the
contract been fulfilled. In this case, it would typically involve the difference between the contract
price ($5,000) and the market value of a similar antique car.
Defenses: Sarah may attempt to assert a legal defense for her actions, such as claiming that there
was coercion, duress, misrepresentation, or mistake when entering into the contract. However,
for such defenses to be successful, she would need to prove their validity in court.
Ultimately, the outcome will depend on the specific circumstances, applicable contract laws, and
the court's decision. In general, though, a valid contract has been formed, and Mark has legal
options to enforce it or seek compensation for Sarah's breach.
3. Sarah owns a vintage car and wants to sell it. She puts up an advertisement online with a
description of the car, including its make, model, year of manufacture, and a statement
that the car is in excellent working condition. John sees the ad and contacts Sarah,
expressing interest in purchasing the car. They agree on a price of $20,000. John travels
to Sarah's location, inspects the car, and decides to buy it. He pays the $20,000 in cash,
and Sarah hands over the car's keys to him. However, the next day, John tries to start the
car but it doesn't work. He takes the car to a mechanic who informs him that it requires
significant repairs. Feeling misled, John wants to return the car and get his money back.
Answer: In this scenario, the situation revolves around the law of contract, specifically the
principles of misrepresentation and the remedies available to the parties involved.
Misrepresentation occurs when one party makes a false statement of fact to another party, which
induces the other party to enter into a contract. Here, Sarah's advertisement describing the
vintage car as being in "excellent working condition" could potentially be a statement of fact. If
this statement is proven false and led John to believe the car was in good condition, it could be
considered misrepresentation.
In this case, there are three types of misrepresentation that could be applicable:
Innocent Misrepresentation: If Sarah genuinely believed the car was in excellent working
condition based on the information available to her, but it turned out to be untrue, it could be
considered innocent misrepresentation. In such cases, the contract might not be voidable, but
John may still be entitled to claim damages.
Negligent Misrepresentation: If Sarah didn't take reasonable care to ensure the accuracy of her
statement about the car's condition, her negligence could lead to a case of negligent
misrepresentation. This could make the contract voidable, and John could seek damages for the
repairs.
Fraudulent Misrepresentation: If Sarah intentionally made the false statement about the car's
condition with the intention of deceiving John, it could be considered fraudulent
misrepresentation. In this case, the contract could be voidable, and John might be able to claim
damages and potentially even rescind the contract.
Considering the situation, John's best course of action would likely be to inform Sarah about the
car's actual condition and request a refund. If Sarah refuses, John may need to take legal action to
recover his money. The court would consider factors such as the nature of the misrepresentation,
the impact on John's decision to buy the car, and the available remedies.
It's important to note that contract law can be complex and may vary depending on the
jurisdiction. The outcome could differ based on the specific laws applicable in the jurisdiction
where this situation takes place. Therefore, seeking legal advice from a qualified professional is
recommended in such cases.
Question: Sarah agrees to sell her old laptop to John for $300. They both discuss and finalize the
deal. However, the next day, Sarah informs John that she can no longer sell the laptop as she has
decided to keep it. John is disappointed and claims that they had a valid contract. Is there a valid
contract in this situation? Explain.
Answer: In this situation, it appears that there is a valid contract based on the principles of
contract law. For a contract to be valid, there are essential elements that must be met: offer,
acceptance, consideration, legal capacity, and lawful object.
Offer: Sarah's agreement to sell her old laptop to John for $300 constitutes an offer. An offer is a
clear and definite expression of willingness to enter into a contract on specific terms.
Acceptance: John's acceptance of Sarah's offer to buy the laptop for $300 completes the mutual
assent required for a contract. Acceptance is the unqualified and unequivocal agreement to the
terms of the offer.
Consideration: Consideration refers to something of value exchanged between the parties,
typically money, goods, or services. In this case, the consideration is the $300 that John agreed to
pay for the laptop.
Legal Capacity: Both Sarah and John are assumed to have the legal capacity to enter into a
contract. They are of sound mind and age, and there is no indication that they lack the capacity to
understand the terms and consequences of the contract.
Lawful Object: The object of the contract, the sale of an old laptop for a monetary amount, is
lawful and does not violate any legal principles