General principles and remedies for contract breach

What are the general principles in the formation of a contract? What are the various forms of remedies available for a breach of contract? Give example with cases.


Nowadays, business Law is becomes a common study, because it related with our real life spent. As we know that, there are everywhere using a ‘’ copycat’’ , it mean that the original has been copy by another manufacturers. And it pop up with a hot trend, which is – Copyright. Other than that, business law is not only discuss about the trademark, it only included the statement that the agreement between promisee and promisor. This is a introduction for the Question 2. In this question, I would like to explain about general principal and remedies for breach of contract. In general principal, there are 4 term of the law, offer, acceptance, intention to create legal relations, and consideration. And this assignment are also discuss about the various forms of remedies available for a breach of contract.

General principal

Below is the diagram of the general principal in the Business Law :

In business law, at first, it is always come out intention to create legal relations, intention to create legal relations is to build up a good relation between the offeree and the offeror, after the create legal relations. Once the offeror are having good relations with offeree, it will turn to offer, offeror have to offer their goods and services to the offeree. And the 3rd part is consideration, after the offeror offer their goods and services, the offeree should consider before the accept from the offeror, and have to consider when after buy the things, did the offeror provide any after sales service, like warranty, and guarantee. At the end, it’s turn to Acceptance, it’s mean accept by the offeree from offeror.

The step and the explanation :

Step 1 - Offer

An offer is an expression of willingness to be bound by the term of the contract. Offer can be make by a person called ‘’ Lateral ‘’ or to a group itself of person or whole world at the large ‘’ unilateral ‘’. Either in agreement or communication, offer is always starts by the offeror to the offeree. An offer is also made when once party makes it clear. The person is prepared to be bound as soon as the offer is accepted by the person to whom to made it. Generally, offer is also start from ‘ask’ and ‘invitation’. For the revocation, it must to be effectively and must be communicated.

In the case of Carlill v Carbolic smoke ball (1893) 1 QB 256 :

At the end of the conclusion of the case Carlill v Carbolic smoke ball, The Carbolic smoke ball won in the court and it because the court judgement of the appeal said the advertisement in this case was an offer and the wording of the advertisement already clearly showed an intention to be bound to anyone accepting.

Step 2 – Intention to create legal relations ( I.T.L.R )

Intention to create legal relations is a term that to build a good relationship within the promise and the promisor. And I.T.L.R is use more on Business agreement. It is very important to create a legal relations because while having a agreement, both sides won’t easily get argue and the transaction with process smoothly. While having a bad or illegal relation, there will argued it because either the offeree or the offeror did not stated clearly an ingredient information, so both sides might get trouble because of the wrong or mistake information.

In the case of Jones v Padavatton [ 1969 ] 2 all ER 616, CA

The Court (Judges) of appeal said she should succeed, in the agreement between mother and daughter was a family arrangement not intended to be legally enforceable. The P’s daughter will lose it because she did not get approval from her mother, and it is not intended to be legally relations between mother and daughter.

Step 3 – Consideration

Consideration is a term that pay something and it will get back something. It is paying or promising to pay money in return for the supply of goods and services, and it also constitute the most common from consideration. Generally, a promise unsupported by consideration is not the biding concept.

In the case of Hartley v Ponsonby ( 1857 ) 119 ER 1471, QB

In the end of the conclusion, The captain should pay the extra salary to his crew, because they had done their overload worked of 19 out of 36 and did not get their extra salary from the captain that he had promised to his crew.

Step 4 – Acceptance

An acceptance of an offer is the final and unqualified assert to the term of the offer. Once acceptance has be communicated and it cannot with withdrawn but an offer can be re-active anytime before it is acceptance by the person. A simple contract requires an offer made by one party and accepted by another party ( or the third party ), it is valuable consideration is given by the other side, and a common intention is the agreement should be legally binding.

In the case of Felthouse v Bindley ( 1863 ) 142 ER 1037, Exch Ch

In the of the conclusion of the case Felthouse v Bindley ( 1863 ) 142 ER 1037, Exch Ch, The D was won in the court. The Court of common pleas was affirmed on appeal and discriminated that there was no contract between P and J. P’s letter was an open offer that had not been accepted by J.

Remedies for breach of contract

The following are the Remedies for breach of contract:

Rescissions of contract

The equitable remedies of rescission can be use either two of situation

While the contract are already confirmed by both side or agreed by between promisor and promisee, once either promisor or promise has break the contract , it can be declare to the person who break the contract.

B) Damagers

According to Section 74 of the contract act 1950, it is a term that when the consumer are not happy with the product during the warranty, the consumer are having the right to ask for the refreshment and repair with no any chargers. Let say Paul buy a handphone from the B handphone dealer. Once Paul had bought the handphone, within 48hours, he figure out the handphone screen can’t display well, when Paul take it to the dealer shop, and the dealer says if want to repair the handphone, it might cost him a sudden amount, Paul is having the right to sue the dealer because at first the dealer promised to Paul that the phone are having 1year warrantly.

Specific performance

It is a term that focus on quality in workplace based on contract. Labour force should keep the quality of performance because before offeree start to work or process for the offeror, Once the worker have not doing well in their work, it can be get declare by the boss it because they already sign for the contract and the work descriptions are already stated inside the statement.


It is a term that to stop or to hold someone or some to doing things. The court decision that is to intended to prevent harm. Injunction can be either long term or short term, pending a consideration and acceptance clause of the issue at trial.


It is a term that to set dateline to return something, if over the dateline, it can be declare to the person who break the contract. Here is the example, if B party look for P constructor to build a new house, and P constructor promised to build the new house between 2month , and when come to the 3rd month, P constructor can’t finish to build up the new house that the B party want , B party can declare to P constructor that he had not completely his project.


At the end of the assignment, business law are the common study and a important study, because law is relate with humanity live. Law is also a common knowledge to protect promisor and promisee. Sometime, people like to get benefit from the others, when the offeree have sign the contract with offeror, after the agreement had already approve by both side, sometimes, mostly we will see the offeree like to get more benefits, and then the benefits that the offeree had requested is not stated in the agreement, so the offeror have the right to ignore that what had offeree requested to offeror. While offeree want to declare to offeror, law will help the defendant. So, Law is a important studies that for everyone, especially in the business sector. Once I had finished the assignment question, I appreciated and I had gain more knowledge from the business law.