Relevance of the topic
The law of contract is a considerably wide topic in business law. Apparently, this is the most essential and useful part of business law. There are many reasons why I elected to discuss this topic in light of a recent case. The main reason why I selected the law of contract is because, in everyday life, human beings engage in contracts. Such contracts come in many forms, the most common ones being the sale agreements (Stone 112). Apparently, contracts are agreements enforceable under civil law. The law of contract is actually the basis of business transaction. The second reason why I selected this topic is because, as a business student, I expect to apply the knowledge gained from business law substantially in future. Upon completing my studies, I am certain that I will find myself in so many legally enforceable decision making environments. Another key reason behind my choice of topic is the reality that contract law guides people in many situations that they may come along in everyday life. For instance, it is only through studying contract law that an individual will know what to do in the event that breach occurs.
Summary of the case
The case is titled John Grimes Partnership Ltd v Gubbins [2013] EWCA Civ 37 - 05/02/13. In the case, the appellant is an engineering consultancy firm. The defendant in the case being appealed was a farmer by the name Gubbins. The agreement between the two parties was made in august 2006 and officially enforced in 2006 September. The requirement was to the effect that the appellant finish their work on a piece of road leading to the place where the farmer, Gubbins was developing some private residences. Apparently, the work was to be done by March 2007. Unfortunately, the contractor finished his work on 17th of February the following year. Still, the work was not complete as per the expectations and specifications of the defendant. Mr. Gubbins therefore engaged another contractor from Joint Technical Partnership Ltd. The judge verified that by 8th may the new contractor had taken over from the appellant. By this time, the appellant had been paid only 20000 pounds in consideration with a promise of an extra payment of 2893 pounds. The appellant proceeded to court after the defendant refused to pay the remaining amount. In court, the defendant countered the appellant’s arguments by arguing that the appellant was supposed to pay damages for breach of contract. This is how the case came to came to the court of appeal, where it was dismissed on the grounds of diminution in market value of the property.
Research and analysis
Research and literature are in line with this case in the sense that the law of contract provides various remedies for breach of contract. Breach of contract is a situation where one party to the agreement fails to honor their contractual obligation (Wilkinson‐Ryan 416). In this case, the plaintiff and later the appellant were in serious breach of the contract considering that they extended the period of completion by 15months. During these fifteen months, the value of the private property being developed by Mr. Gubbins went down considerably. This is evidenced by the fact that a housing association offered a lesser amount citing diminution of market value. Following the breach, the appellant was supposed to have paid damages for the diminution.
The outcome
The outcome of the appeal was dismissed as the court of appeal upheld the decision made by the lower court. This was a valid ruling considering that that the appellant had not honored his contractual obligation. His claim that the diminution was unforeseeable was dismissed on the grounds that, in the law of contract, the implied assent to liability if the case that the breaker of the contract is the primary cause of all negative consequences. Therefore, in this case, the party in breach should pay damages because the breach of contract is the primary cause of diminution in the market value of the affordable housing units. Summarily, the decision of the court of appeal to dismiss the appeal is supported by legal literature since such breach of contract is a civil wrong against one party (Beatty and Susan 254).
Relevance of the case
This case is particularly relevant considering that it reflects the current events in business legal environment. The fact that the case is less than six months old is a valid reason to conclude that indeed, the events of the case are reflective of the modern business world. Worth mentioning is the actuality that despite the case having began more than six months ago, it has been concluded most recently. Another reason why this case can be considered relevant is the reality that the case falls in the line of business law, and more specifically, contract law, which we have studied recently. Additionally, the case is applicable in the future as all students of business are bound to engage in contracts.
Ethical considerations
There has been a serious debate in the past over the ethical and moral standpoint with regard to breach of contract. Worth mentioning is the reality that breach of contract results from a party to the contract refuses or fails to honor their part of the contract without a valid explanation to the other party (Shavel 439). This is a legal mistake and should be subjected to damages. Ethically speaking, failure to honor a part of an agreement is wrong, especially where no explanation is given. In the context of the case, the appellant fails to act as per the requirements of morality and ethical behavior. Apparently, the breach should not have occurred at all, and if it should have occurred, the appellant should have given prior explanation. The unethical conduct of the appellant is seen in his decision to go to court despite having been paid a certain amount after his breach of contract.
Conclusion
In conclusion, it is plain to see that the law of contract is particularly important and sensitive at the same time. This is primarily because, the law of contract addresses such things as buying and selling of goods and services, something that people engage in daily life. Worth mentioning at this point is the reality that the law of contract provides guidance on what ought to be done in the event that an individual does not honor their contractual obligations (Stone 68b). The case discussed above, John Grimes Partnership Ltd v Gubbins [2013] EWCA Civ 37 - 05/02/13, is an illustration that parties to contract should at all times understand the implied terms relating to breach of contract. For instance, diminution of market value will be a liability of the breaker if such diminution is directly related to the breach.
Works cited
Beatty, Jeffrey F, and Susan S. Samuelson. Legal Environment. Mason, Ohio: South-Western Cengage Learning, 2011. Print.
Shavell, Steven. "Is breach of contract immoral." Emory LJ 56 (2006): 439.
Stone, Richard. The Modern Law of Contract 6/e. Routledge, 2005. print
Stone, Richard. The modern law of contract. 9th ed. Milton Park, Abingdon, Oxon: Routledge, 2011. Print.
Wilkinson‐Ryan, Tess, and Jonathan Baron. "Moral judgment and moral heuristics in breach of contract." Journal of Empirical Legal Studies 6.2 (2009): 405-423.
