THE UNIVERSITY OF THE WEST INDIES

Undergraduate Coursework Accountability Statement (To be completed by student)

ACADEMIC YEAR: 2011- 2012 COURSE CODE: MGMT2021

SEMESTER: 1 TITLE: Business Law ID: 308004455

NAME: Tanneshia Tavana Taylor

1. I hereby certify that I am the author of the attached item of coursework and that all materials from reference sources have been properly acknowledged. 2. I understand what plagiarism is and what penalties may be imposed on students found guilty of plagiarism. 3. I certify that this paper contains no plagiarised material. 4. I certify that this is my own work and that I did not receive any unfair assistance from others (including unauthorized collaboration) in its preparation. 5. I certify that this paper has not previously been submitted either in its entirety or in part within the UWI system or to any other educational institution. 6. In the case of group work: a. I certify that the individual work of each member of the group has been clearly indicated; b. that where no such indication has been given, I take the responsibility for the work as if it were the section of the paper for which I am solely responsible; and c. that I have not collaborated with any members of the group to breach the Universitys regulations.

Signature: T. Taylor Date: October 26, 2011

Consideration is an essential element of a valid contract. The four main ingredient of a contract is the offer, the acceptance, the consideration and the intention to create legal relation. Consideration refers to what one party to an agreement is giving or promising in exchange for what is being given or promised by the other contracting party. There are certain rules that govern a valid contract. THE ISSUE: The issue in the case is whether the agreement was legally binding upon Dream Design or whether it failed for want of consideration. THE LAW: If the promise merely fulfils an existing contractual duty to the promisor, he does not provide consideration to buy the buy promisors promise. In the case, Atlas Express Ltd. V. Kafco (Importers and Distributors) [1989] 3 W.L.R. 389 K entered into a contract with W to supply W with baskets. The baskets were to be delivered by A and a rate was agreed upon between the party. After the first delivery A demanded more money from K before making any further deliveries to W. K unwillingly agreed to pay the extra money and A continued with the delivery. Later on K refused to pay the extra money to A and A sued K. It was held that A had not given consideration to K to buy Ks promise of extra money. A could not say that making the delivery was the consideration, as A was contractually bound to make these deliveries under the original contract. With the case of Dream Design the consideration will not be sufficient where a contractually duty already exist. The fact is that Parma Steel and Dream Design agreed on a written contract dated October 22, 2009 for the supply of fabricated steel at a cost of $165 per ton for Grade 60,000 and $156 per ton for Hard Grade. In this case Parma Steel could not say that making the deliveries was the consideration, as Parma Steel was already contractually bound to make these deliveries under the original contract. According to Tucker J. there was no consideration for the new agreement. The plaintiff was already obliged to deliver the defendant goods at the rates agreed under the terms of the original agreement. CONCLUSION: The facts constituted economic duress but the court has to refuse to enforce the new agreement for the increase in the prices or the higher charges as it lacked any fresh

consideration from the purchaser, Dream Design. The supplier, Parma Steel claim for the outstanding balance has to be dismissed. Reference: Singh N. 2008, Business Law. Bridgetown Barbados: The University of the West Indies.