Business Law essay

Does the valid contract exist between Gerald and Luis?

Rule

The contract is valid, when all terms and conditions of the contract are clear.

Application

In case of Gerald and Luis, the terms and conditions of the contract are basically clear since both Gerald and Luis presented their offers concerning the contract, although it is unclear, whether Luis accepted the last offer of Gerald concerning his refusal to buy a ton of B Arabica coffee. Nevertheless, the terms and conditions of the contract are basically clear. Therefore, the contract may be considered as valid because both parties involved in the contract presented their position clearly and identified clearly terms and conditions on which they agree to participate in the contract. The only problem is the lack of acceptance of the last offer made by Gerald. In case of the valid contract goes under the trial, the problem may arise since the lack  of the positive response from the part of Luis makes it unclear which terms and conditions he accepts. In this regard, he has two options. On the one hand, he can fully accept the last offer made by Gerald. On the other hand, he may insist on his terms and conditions, which he made earlier, or suggest new ones and insist on Gerald to accept them. In such a context, the contract cannot be viewed as valid because it is unclear which terms and conditions of the contract accept both parties

Conclusion

Therefore, the contract cannot be viewed as valid and if the parties involved has a disagreement and file a lawsuit, the court may discharge the lawsuits as there is no valid contract between the parties.

Issue Does the binding contract exist between Gerald and Luis?

Rule

Basically, the binding contract is a written agreement between parties in which a court may impose penalties in case one party attempts to negate on his or her promise as set forth in the signed document. The binding contract is preceded by the offer and completed by considerations and acceptance of the offer, which means that at first the offer for a contract is made. After that parties consider the offer and they may make their offers in the consideration. Eventually, they come up with final terms and conditions of the contract agreed by all parties involved in the contract and the contract should constitute the written agreement between parties.

Application

In case of Gerald and Luis, they do not have the binding contract. At any rate, they are at the stage of consideration but they have not come to the agreements on terms and conditions of the contract yet. Therefore, they have unclear terms and conditions. At any rate, the parties still consider offers they have made. Instead, they should accept the offers they have made and agree precise terms and conditions of the contract to make the contract binding. In addition, there is no valid contract yet, while the binding contract should be valid. The contract cannot be binding if it is invalid. The main problem of the contract between Gerald and Luis is that the contracting procedure is not complete and the contract has not been bound yet. They are still to come up with final terms and conditions they agree upon to accept them and to create the binding contract.

Conclusion

Thus, the court will not treat the contract between Gerald and Luis as binding and penalties cannot be imposed on either party, in case of breach of the contract.