Legal Aspects

of Business

Principle of Business
3rd Form
May , 2023
 Learning tips
-You're note- book and pen ready
-Pause/ rewatch the video if needed
-All lessons have pre-requisites
meaning you need to finish the
activities in each lesson before
moving to the next lesson.
-Read, understand, and follow
instruction to complete all activities
 Objectives

 Identify the different type of contracts

 Explain three (2) out of the four (4 )
characteristics of contract with 80%
accuracy.
Introduction
What is a contract?
What is the difference between and offeror and a
offeree?
What is Employment Contract?
What are the different types of Contract?
Characteristics of a Contract
Offer and acceptance
 One party (the offeror) makes an offer, which is then
agreed to (accepted) by the other party (the offeree).
This creates a binding contract.
Competence of the parties
• This means that they must have reached the age of majority (i.e.
they are adults), and they must also be of sound mind.
Example
Minors cannot enter into a cellphone contract. A minor can use a
cellphone, but the contract would need to be between a responsible
adult and the cellphone company. The responsible adult would
then be responsible for all charges levied by the phone company
Intention to create legal relations
• This occurs when the parties intend to enter a legally
binding agreement or contract.
A contract Has to meet all 3
• Offer
• Acceptance
• Consideration
Consideration

• Is the exchange of one thing of value (such as a product or

service) for another thing of value (such as payment).
• Bilateral Agreement-(a situation where both parties exchange
promises with each other), each promise is considered as
sufficient consideration for the other.
• Unilateral Agreement- one party makes a promise in exchange
for the other’s performance.
Any Questions
Closure
Who is an offeror?
Who is an Offeree?
What is Acceptance?
What is consideration?
Can a 15 year old take part in a contract?
Concluding: Critical Thinking
1. If someone agrees to give you $5, does this involve
consideration? Explain your answer.
2. A hairdresser promises to cut a client’s hair for $10 and then cuts
the hair to the client’s satisfaction. Is the $10 consideration?
Explain your answer.