The four elements of valid contracts involve the names of the parties, the time for the contract to be concluded, the contract subject, and the price. In case of absence of at least one element, the validity of the contract can be under the threat (August, 2004). In addition, it is important to double-check the presence of the above-enumerated elements of the contract before signing or drafting for the parties to avoid any contingencies and problems in the future (August, 2004).
The valid contract, therefore, should not leave space to imagination; everything should be accurate and up to the point. In case one of the elements is still missing, the court can supply the missing provision with regard to the past and future terms of the parties involved to determine what reasonable actions can be adopted under the circumstances.
Each contract should rely on the objective theory of contracts which states that “…a party’s intent is deemed to be what a reasonable person in the position of the other party would think that the first party’s objective manifestation of intent meant” (Emanuel, 2008, p. 9). In this respect, in case one party makes offer to another one, it is important to make sure that the first party’s conduct is congruent with the position of another party.
In other words, the party that receives an offer should be sure that the contract involves the actual offer. Second, the contract should also be legally enforceable. It means that in case both parties do not want their agreement to be legally enforceable, the contract will not be void. At the same time, if the both parties approve the contract, it can be regarded as legally enforceable. The legal enforcement can be in the form of oral agreement if the parties reach a consensus concerning this issue.
With regard to the established conditions, both parties, either externally or internally, should be bound by the agreement and all their actions should be directed at accomplishing the agreement. All these terms are valid in case both parties are involved in the agreement. In the case under analysis, a Seattle man does not have legal grounds to believe that the soft-drink company offers a specific term that it promises to accomplish.
Neither oral nor written contracts were introduced. What is more important is that legal procedures were excluded from the terms of the oral contract. In addition, according to the objective theory of contract, each party should be equally involved into the accomplished of terms, if any. While considering the case, no actual terms of agreement were presented, except for the one for advertising purposes.
Objective theory of law implies that the agreement is premised on the objective intent of both parties, but not on the subjective purposes of one of the parties. Therefore, the claimant’s intentions could be regarded as subjective ones. On the other hand, the soft-drinking company provided clear terms in accordance with which it was possible to buy Harrier jet in case of consuming company’s products.
There are several reasons for the court to withdraw the claimant lawsuit because of the existing requirements to the valid contract. To begin with, a valid contract should have two major components – the offer and the acceptance. It means that one party should represent an offer and another one should accept this offer.
Under these terms, the question arises concerning the actual presence of offer. Second, each valid contract should undergo consideration. Thus, “any promises made by the parties must be supported by legally sufficient and bargained for consideration” (Miller, 2012, p. 133). Under these conditions, the case under analysis does not include any legal considerations and legally bound agreements, which makes it impossible for the court to uphold the claimant’s decision.
Aside from the presence of agreement and consideration, the void contract should also be premised on contractual capacity. It means that both parties involved into the contract must be recognized as the ones possessing characteristics of competent parties (Miller, 2012). Thus, the parties should express either offer or acceptance that is reasonable and that is justified by the law.
Finally, the contract should be carried out to the established norms in terms of legality and adherence to the public norms (Miller, 2012). In this respect, the case reveals that none of the parties is legally bound and the offer represented in the advertisement is not actually an offer. With regard to the above-presented requirements to the valid contract, it should be stressed that the court had substantial grounds for not considering the plaintiff concerns as legally acceptable.
Apart from the discrepancies related to the elements and validity of the contract, specific attention should be the considering of advertisement as a kind of an agreement between the company representing a product and a consumer watching the commercials. In fact, advertisements cannot be regarded as offers because they are actual invitations to deal.
In addition, there are a number of reasons for not considering advertisements to be offers. First, though the advertisement provides a kind of offer, they are not represented for an identifiable offeree. Second, advertisements are not addressed to a certain person. Finally, advertisements often lack contractual intent. In this respect, the case represents a TV commercial that is interpreted as “invitation to the public to make offers to the advertiser” (Emerson, 2009, p. 88).
Consequently, the case under analysis and the above-represented legal issues approve the court decisions. In addition, business environment usually uphold advertisements and commercials in ethical terms to maintain goodwill and comply with the current consumer protection laws. The given explanation also provide legal grounds to consider advertisement as an invitation to deal only, but not as the valid contract, although the commercial represents the price, and terms, and certain aspects of offer.
The given case under analysis can be discussed with regard to the legal definitions of unilateral contract. Thus, a unilateral contract “…involves a promise by one party and an act by the other” (Emerson, 2009, p. 84). However, in case a person who receives the offer acts out before the agreement, it can become bilateral. Thus, the type of contract is based on a promise; however, it does not imply the participation of another party in the issue.
The company does not require any promises from their consumers. It just invites individuals to use their products, but not offers specific terms under which the product can be sold. Once again, the given case proves that the advertisement cannot be referred to the type of bilateral contract. Neither can it relate to any types of contract. Therefore, even if the consumer considers it as a reward situation, some of the terms of unilateral contracts contradict the established principles of legality.
References
August, R. (2004). International Business Law: Text, Cases, and Readings. US: Prentice Hall.
Emanuel, S. (2008). Contracts. US: Aspen Publishers Online.
Emerson, R. W. (2009). Business Law. US: Barron’s Educational Series.
Miller, R.L. (2012). Fundamentals of Business Law: Summarized Cases. US: Cengage Learning.