Contract Law Case Study

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(A) Remedies are entitlements given to parties who are affected by a breach of contract. There are a few remedies under the common law but the most common is damages – contractual and tortious damages. (Wright 2010) To determine if State Trains is entitled to any remedies, we must first substantiate if the contract was frustrated or if this was a case of breach of contract. It has been established that there is a legally binding contract between the two parties. An agreement exists between the two wherein Snacks Ltd is to provide food catering services to State Trains in exchange for a fixed payment as stipulated on their contract terms. However, due to unforeseen events, Snacks Ltd is claiming that the contract between them and State Trains …show more content…

On the other hand, a breach of contract occurs when a promisor fails to discharge a contractual obligation without lawful excuse after the performance is due or when there is an anticipatory breach before the promise is due. (Carter, Peden & Tolhurst 2007) Applying this to the sample case, we can deduce that the two separate events – increase in costs and damage to the company’s factory – would have resulted to a breach in …show more content…

Assuming that the company is not protected by a force majeure clause, then, if they don’t deliver their obligations as agreed upon, they would be in breach of contract regardless of the circumstance. In conclusion, assuming that hardship and force majeure clauses were not included on the terms, then, according to common law, this case would be considered a breach of contract due to Snacks Ltd refusal to honour the contract. With this, since they are breaching an essential condition, State Trains has an option to terminate their agreement and sue for damages. (B) The terms according to the case specifically prohibits any increases in price in the duration of the contract. Assuming that Snacks Ltd’s contract with State Train is still in force, then, State Trains is under no obligation to pay more than what they were originally paying for the same

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