OBLIGATIONS A Essay Example | Topics and Well Written Essays - 2000 words

OBLIGATIONS A - Essay Example re contractual relationship.3 In the milieu of lengthy negotiations between the contracting parties, it becomes difficult to establish whether the contract has been formed and the time when it becomes effective or the conditions under which it was formed.4 This document examines a case study involving a negotiation between Andalasia and Arundel PLC to determine whether their negotiations could be construed as offer and acceptance leading to a legal agreement. A contract must have an offer by from one party to the contract that must be accepted by the other party to signify mutual consent to form a legal agreement.5 Offer expresses the willingness of one party to enter into an agreement with another party under the terms specified in the offer and which the other party must accept outright. The offer must communicate their intention to the other party whose acceptance forms the basis of the legal relationship.6 The acceptance of an offer should not alter the terms of an offer a condition referred as â€Å"mirror image rule.†7 However, in case the party to whom the offer is made introduces new terms as the prerequisite for acceptance that will amount to counteroffer that is tantamount to rejection of the offer.8 As described in the principle of UNIDROIT, a contract can be established by an acceptance of an offer or conduct of the parties as long as they are sufficient to demonstrate agreement.9 The parties intending to form a contra ct must demonstrate their intentions to be legally bound before a contract is recognized as binding. In addition, there should be the consideration between the parties forming a contract though it needs not be adequate.10 Consideration could be anything of value exchanged between the parties or a detriment one party is likely to suffer due to the breach of conditions set in the agreement. There are other requirements the parties must satisfy in order to establish a formal agreement. For example, the parties must have contractual capacity