Business Law
Business Law
The contract that will be discussed for analysis in terms of business law is a rental or tenancy agreement initiated in Singapore by a friend who relocated with his family last November 2015.
The legal definition of a real estate lease is referred to as a legal and binding contract amid the landlord and the tenant and for the contract to be binding the signing parties needs to be of legal age and competent to enter into an agreement (Kimmons, 2016).
The issue that pertains to every contract law is with regards to how the contract is formed, and whether it is enforceable or unforceable legally in lieu of the five essential elements that are as follows (Contracts & Legal, 2015):
The first element is the Offer which is a precise promise and precise demand and in the case of tenancy discussed, the offer was made on the 20th of November between the landlord Mr. Peter and the tenant, my friend Mr. Malik, whereby it was agreed that the landlord agrees to and the tenant agrees to take the premises known as 570 Alexander Road, The Anchorage #05-16, Singapore 158893 together with the furniture fixtures and fitting and other effects therein as shared in the inventory list.
The agreed contract offered is for a period of twelve (12) from the 20th day of November 2015 to the 19th day of November 2016, for the grand total Singapore Dollars Three Thousand Only (SGD 3,000) per month made up as follows:
Singapore Dollars Eight Hundred Fifty Only (SGD 850) as hiring charges for the furniture & fixtures and fitting enumerated in the inventory.
Singapore Dollars One Hundred Fifty Only (SGD 150) being the service and maintenance charges payable in respect of the said premises to the Anchorage Management Corporation.
The offer also includes the security deposit that is equivalent to one month of the monthly rent on the signing of the agreement that will be held by the landlord as a security for the due performance and observance of the stipulations during the 12 month tenancy agreement.
The second element is the Acceptance which is in the form of an act or promise and in relation to the tenancy agreement, there was no counter offer in relation to negotiating the amount offered for acceptance.
The acceptance includes numerous stipulations that include, the service and maintenance of the home, with the major stipulations including, service of the air conditioner every 3 months, minor repairs below $ 150 to be paid for by the tenant Mr. Malik.
The affixation of anything needs to be in writing to the landlord, besides, the tenant cannot carry out any alterations to the premises, no holes of any kinds can be hacked in the walls, no scratching of the floors, no pets, and curtain cleaning to keep them hygienic, are also the stipulation that was accepted by the tenant.
The third essential element is the Consideration that is in essence providing something of value by the both the parties, to enter into the agreement, and from a legal viewpoint it is not necessary that the consideration includes money.
The consideration offered by the landlord is the premises with furniture fittings, and a 12 month tenancy contract, and the tenant’s lawful consideration is the payment of 1 month security deposit of SGD 3,000 and the agreement to pay the monthly rent in advance without demand on the 30th day of each calendar month throughout the tenancy.
The fourth element is the Capacity that requires the capability of the individuals to enter into a contract, and the tenant and the landlord, are neither, minor, nor mentally incompetent or were intoxicated when the agreement was made.
The fifth and the final essential element is Lawful Purpose that entails a legal purpose that is enforceable in the court and in the case analyzed it is the tenancy agreement that requires a legal purpose to protect both the tenant and the landlord.
The circumstance for the breach of contract starts with any issues that may emanate by the landlord withholding the full or part of the security deposit at the end of the contract if any stipulations are found to be violated, and the best possible remedy is for the tenant to keep a list of the stipulated issues that may happen and keep the landlord up to date for avoiding any issues with the security deposit.
The breach of contract option also comes into effect if the tenant wants to leave the premises before the 12 month time duration as agreed, and the commission paid to the salesperson who initiated the contract will not be reimbursed, and the remedy is to connect with the landlord 1 month before in writing to be able to avoid any breach.
The final breach of contract is subletting the premises to other occupants within the 12 month timeline, and legally this can be avoided by voiding the contract and allowing the new tenants and landlord carve a new legal contract.
References
Contracts & Legal (2015). Contract Essential Elements. Acq Notes.
Retrieved from http://www.acqnotes.com/acqnote/careerfields/contract-essential-elements
Kimmons, J. (2016). Elements of a Good Lease Document. About Money.
Retrieved from http://realestate.about.com/od/realestateinvesting/p/lease_document.htm
