Question
Sam calls her friend Nina and asks, 'Would you like to buy my car? I will give it to you for $100,000.' Nina replies, 'I
Sam calls her friend Nina and asks, 'Would you like to buy my car? I will give it to you for $100,000.' Nina replies, 'I love your car. Can I get back to you next week?' Sam is happy to give Nina time and says, 'That's fine. I will give you time till 5.00 pm next Monday, but you must bake me a cake for waiting.' Nina replies, ' Sure thing. I will bake your favourite chocolate chip cake.' For that Sam, states, 'Make sure to give me a call before 5.00 pm next Monday.' Nina sends a text to Sam by 12.00 pm on Monday, confirming the purchase of the car and states, 'Hi, how about I pay you $95,000 in cash. I will be at your place around 2.00 pm tomorrow to pick up the car.' Sam replies to the text, 'Hi Nina, Fine. I am doing this because you are my friend. See you at 2 pm.' As she is driving the car out onto the street, Nina leans out the window and asks Sam if the vehicle is suitable for off-road driving. Sam assures that the car runs smoothly in city traffic and off-road trails. Nina decides to take one of her favourite off-road trails and notes that the engine makes noises and overheats. Nina takes the car to a mechanic, who tells her that the vehicle is designed only for city traffic and not off-road driving.
- Discuss the legal effect of each communication and determine if an agreement is formedand whether there is an intention to be legally bound by the contract.
- Assuming there was an agreement and intention to a contract between Sam and Nina, discuss whether there is valid consideration for Sam's assurance of the car's suitability for off-road driving? (6 marks)
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