Ch 2. Resolving Conflict in the Marketplace Flashcards
A contract
- A legally binding agreement that can be enforced in a court of law
The Law of Contract
- Sets out the rules for proving when a contract exists and when it is terminated
8 elements of a legally valid contract
- Offer
- Acceptance
- Consideration
- Intention to contract
- Consent to contract
- Legality of form
- Legality of purpose
3 ways an offer is made
- Verbally
- In writing
- By conduct
3 ways an offer is terminated
- Revoked
- Not accepted in time
- Rejected
Revoked
- Withdrawn before the other party has accepted it
An invitation
- An invitation to a customer to make an offer which can be accepted or rejected
Acceptance
- The other person agrees to all the terms of the original pffer without any conditions
3 ways an offer can be accepted
- Verbally
- In writing
- By conduct
Consideration
- What each party offers the other as evidence of their agreement
Intention to Contract
- The parties to the contract must have intended to create a legally binding contract that could end up in court if not fulfilled
2 contract law assumptions
- Business agreements are intended to be legally binding
- Social and private agreements are not intended to be legally binding
Consent to Contract
- Each party must give genuine agreement of their own free will to the making of the contract
Consent to contract may not exist if (3)
- A person is persuaded against their will by intimidation or against their will
- A person enters as a result of deliberate misrepresentation or dishonesty by others
- A genuine mistake happened
Capacity to Contract
- People agreeing to the contract must have the legal right to do so
People who don’t have the legal right to enter a contract (3)
- Under 18’s
- Intoxicated, insane or of unsound mind
- Companies outside of its legally stated purpose
Legality of Form
- Certain contracts must be drawn up in writing before they can become legally binding
Legality of Purpose
- For a contract to be legally binding
- it must be for a legal purpose
- not involve committing any crime or breaking any law
Termination of Contract
- It can no longer be legally enforced
Contracts can be terminated by (4)
- Performance (obligations fulfilled)
- Agreement
- Frustration (accident)
- Breach of contract (condition broke)
A condition
- An essential element of a contract
A warranty
- A non-essential element of a contract
Breach of Contract Remedies (3)
- Cancellation
- Compensation
- Specific performance
Specific performance
- Getting the court to order the other party to keep their side of the agreement
Caveat Emptor
- Legal term
- “Let the buyer beware”
2 legislations protecting consumers
- The Sale of Goods and Supply of Services Act 1980
- The Consumer Protection Act 2007
The Sale of Goods and Supply of Services Act 1980 sets out (3)
- The legal right of consumers when they purchase goods
- The legal responsibilities of retailers to consumers
- The legal remedies available
The legal rights of consumers (6)
- Goods sold must be of merchantable quality
- Goods sold must be fit for the purpose intended
- Goods sold must be as describes
- The buyer is entitled to legal ownership and quiet possession
- Services must be provided by a competent person with skill and using due care and diligence. Materials used of quality
- Consumers renting or buying on hire purchase have the same rights
Merchantable Quality
- Goods sold to consumers must be reasonably durable
Quiet Possession
- The buyer being able to use the goods as they wish
The legal responsibilities of retailers (6)
- They are legally responsible for defects
- They must respect all the legal rights of customers
- Complaints must be dealt with
- Signs pretending to limit the retailer’s liability are illegal
- Any product guarantees offered
- Illegal to demand payment for unsolicited goods sent to consumers
Unsolicited goods
- Goods received by an individual who did not agree to receive them
Legal remedies for the fault of goods (3)
- Repair
- Replacement
- Refund
Consumer Protection Act 2007 (2)
- Protects consumers from unfair business-to-consumer commercial practises.
- Bans practises that are unfair, misleading or aggressive towards consumers and are likely to impair a consumers choice.
What does the Consumer Protection Act 2007 prohibit (4)
- False product descriptions
- False prices
- False or misleading advertising
- Businesses from engaging in aggressive practices
What did the Consumer Protection Act 2007 establish
The National Consumer Agency
The National Consumer Agency
The State agency that promotes consumers’ awareness of their legal rights and ensures that consumer legislation is obeyed by businesses
What is the NCA responsible for (5)
- Enforcing consumer laws by investigating, issuing fines and bring offenders to court
- Providing information and advice to the public on their rights
- Providing information and advice to businesses on their legal responsibilities
- Advising the government on how to ensure the welfare of consumers is protected
- Publishing a Consumer Protection List of businesses found breaching consumer law
Non-Legislative ways of resolving the issue (2)
- Talk to the retailer
- Seek help from a third party
Best way to talk to the retailer (4)
- Know your legal rights
- Bring along a receipt as proof of purchase
- Complain in a friendly but firm manner
- Write a formal letter if talking doesn’t work
Organisations that assist in resolving a consumer conflict (5)
- National Consumer Agency
- Industry trade associations
- Consumers’ Association of Ireland
- Financial Service Ombudsman for complaints concerning financial institutions
- Office of the Ombudsman for the Public Service
Consumers Association of Ireland
Non-commercial organisation set up to protect and promote the interests of consumers
Main activities of the Consumers Association of Ireland (4)
- Publishing reports and surveys into consumer products and services
- Highlighting problem areas where consumers interests are being neglected and seeking improved standards
- Running a consumer advice service
- Lobbying the government for changes and improvements to consumer rights legislation
Financial Services Ombudsman (2)
- Resolves complaints against financial institutions (insurance companies, banks etc.)
- Decisions made are binding on the institutions
The Office of the Ombudsman for Public Services
- Deals with consumer complaints against State-owned organisations, govt. departments and local authorities
- It has no power to force its recommendation to be accepted.
The Small Claims Court (2)
- Provides an inexpensive, fast and easy way for consumers to resolve disputes without the need to employ a solicitor
- Cannot force an agreement but effective at persuading sellers to respect consumer rights
2 Advantages of Small Claims Court
- Faster than going to the district court
- Low cost, small fee, no solicitors
3 Disadvantages of Small Claims Court
- Only deals with complaints up to a limited value
- Recommendation is not legally binding
- If you are not happy with the outcome, you will have to go to for a full court hearing in the District Court or higher court
