As mentioned above, a valid contrac

As mentioned above, a valid contract ought to have three elements: agreement, consideration and legal intention. Now, working as a legal assistant in a law firm names Bizlaw Consulting to analyze the first case of Macmahon from scenario “Gibson is a tenant of a home unit owned by Macmahon Mining Services. Ten days ago, Gibson received a letter from Macmahon stating that “The Corporation may be prepared to sell the house to you at the purchase price of £2,725... If you would like to make formal application to buy your Council house, please complete the enclosed application form...”. Three days later Gibson completed the form and posted it to Macmahon in which he agreed to buy the home unit for the price set out in Macmahon’s letter. The next day, Gibson telephoned Macmahon and said that he did not want buy the home unit and that he did not have any legal intention to a binding agreement”, which will base on three elements above to analyze clearly.
To begin with the Agreement, it is agreement of parties to create a legal relationship. From the scenario, it existed a agreement between Gibson and Macmahon, so that the elements to create a agreement include offer and acceptance. It can be clearly seen that letter was given for a determination subject, which was Gibson. In addition, the subject to exchange was a house with the price £2,725, it had a requirement “please complete the enclosed application form”, answered letter of Macmahon by letter through post office. All elements above were enough conditions to be offer. Next, there are many elements to determine the acceptance of Gibson for Macmahon. Gibson agreed to buy the home unit for the price set out in Macmahon’s letter, agreed all contents offer from Macmahon and performed all requirements in offer of Macmahon. Following the case Adams v Lindsell 1818 (p.71), the acceptance of Gibson had a validity to bind parties at the time when Gibson spend letter through post office for Macmahon. Besides that, Macmahon did not require about time to answer letter, so that Gibson spent letter to accept on three day later, which can be a reasonable time because it is an exchange between offerer and offeree through letter and the subject to purchase was house, so that the house is a value possession with consumer and they need to have some days to think. Therefore, it have enough element to take form a contract. After that, Gibson telephoned to Macmahon on the next day, which does not change the validity of Gibson’s acceptance.
Secondly, it is the Consideration, which is a important things in the contract because it will decide the value of contract. From scenario, the circumstance “The Corporation may be prepared to sell the house to you at the purchase price of £2,725” is specifically and validity value of contract. Therefore, it could be adequacy of consideration following the case Thomas v Thomas 1842 (p.83).
The final element is Legal intention, which can be determinate through four elements capacity, form, genuine consent and legality. In the capacity, Macmahon is a company, which was established legality, so that Macmahon have enough capacity to perform the contract. Following the scenario, it did not mention about the age and capacity of Gibson, so that legal assistant can base on circumstance from scenario “Gibson is a tenant of a home unit owned by Macmahon Mining Services”. This circumstance can prove that Gibson was not minor. Even if Gibson is a minor, he will not have enough capacity to rent a house, and then Gibson is a party in the contract of Macmahon. For the genuine consent, it is a kind of purchasing contract and the subject to purchase is a house under controlling of Macmahon. Plus, Macmahon spend the offer for selling house for Gibson, so that it proves that Macmahon had the proprietress legality with this house. For the form of contract, the contract to purchase house was offer purchasing following the application form of Macmahon. After that, Gibson completed the form and posted it to Macmahon. Therefore, the purchasing contract was set up by document suitability. Finally, Macmahon and Gibson were voluntary to agree and sign in the purchasing contract, did not have any binding or any threats to perform the contract, so that this contract was legality.
To sum up, the purchasing contract had enough elements such as valid offer, enough information, determinate the offeree clearly, have basic contents and determinate the way to answer the offer of Macmahon. All elements above were enough conditions to perform a valid contract at the time when Gibson spent letter for Macmahon by post. Therefore, Gibson was bound by a valid contract with Macmahon and could not refuse the purchasing, so that Gibson had a liability with this contract and must continue the purchasing house with Macmahon.