Billy is attempting to claim the extra $20,000 and a share in the farm, which he believes he is entitled to. Choy, however, has calculated that the cost of Billy’s school and university fees amount to greater than the promised $20,000 and that the co-owner of the farm would not allow the transfer of a share in the farm.
In order to advise Billy in whether he is entitled to the extra $20,000 and a share in the farm, the key facts and relevant issues must be examined to determine if the elements of a legally binding contract exists. Whether there was an agreement and intention to create legal relations between the two will be used to determine whether Choy has breached a contract between the two. If a contract is found to…show more content… Consideration may consist of “some right, interest or profit, or benefit accruing to the one party, or some forbearance, detriment, loss or responsibility, given, suffered, or undertaken by the other”. The promisor must have explicitly requested the ‘detriment’ or ‘responsibility’ undertaken by the promisee, in this case shown as Billy’s work was in response to Choy’s specific request. Billy’s “loss” included his physical labour and the temporary giving up of his study; in return he relied on the fact that Choy would pay him the agreed amount. Both parties had provided good consideration in the initial agreement.
Therefore the facts of this case indicate clearly that there is a contract between Billy and Choy, as the main elements of agreement, intention to create legal relations and consideration are satisfied.
b) Have the terms of the contract been changed?
It has been established that the initial agreement between Billy and Choy formed a contract that was characteristic of a business nature. The terms of the initial contract were communicated orally with no intention to draft a written and signed contract between both parties. The contract may be altered verbally with the agreement of all parties.
Leaving the existing contract in place and adding or changing terms can only occur with full agreement by all parties. The action of Choy updating his
