By Terry Price (auth.)
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Extra info for Mastering Business Law
Sample text
34 In addition to these three ingredients several other ingredients must be present in order for an agreement to be legally binding. It is essential that the two parties entering into the agreement must have the capacity to do so. By saying a person has the capacity we mean that he is legally entitled to enter into a contractual agreement. In English law a person who has attained the age of eighteen has full legal capacity and therefore can enter into legally binding arrangements. A person below the age of eighteen has not got this full capacity and there are certain agreements entered into by young people who are under eighteen (to use the legal expression , who 'have not reached the age of majority') which are not legally binding because for these agreements the young person (the minor) has no contractual capacity.
1. 1986/2221. 24 Precedent This is a system where once a court has stated the legal position in a given situation then the decision reached by this court will be followed in all similar cases. We have already learned the system of courts in England and Wales and the rule is that decisions of the higher courts will be binding on the lower courts. This means that the lower courts must follow the decision of the higher courts, so for example the decisions of the House of Lords will be binding on all other courts.
We have seen that consideration must be two-way and in this case Adam has done the tax returns and Roy is going to supply the carpet. e. the tax return , is in the past and the courts will not recognise past consideration. As far as the courts are concerned, the promise by Roy of the carpet is merely one-way and as suggested in the example merely a gift ; Roy 's prom ise is not legally binding. e. e. Roy provides the carpet and Adam does the tax return in the future . It must, however, never be in the past.