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Disputes Between Optum Marine Ltd and Logistics Companies

Date:  2021-05-26 12:18:28
8 pages  (1989 words)
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Task 1: Dispute between Optum Marine Ltd and TransAtlantic Distributors Ltd/Global Freight Ltd

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In the English law, a contract is considered as an agreement that subsequently gives rise to an obligation that is recognised or enforced by the law. However, three essentials are required before a contract is created. These are the agreement, the contractual intention, and the consideration. For this reason, the first requisite of a contract is that the parties involved need to have reached an agreement. In the case of the dispute between Optum Marine Ltd and TransAtlantic Distributors Ltd/Global Freight Ltd, the managing director never replied to TransAtlantic Distributors Ltd, and for this reason, it can be considered that virtually, Optum Marine Ltds managing director had not sealed the agreement.

Even so, the managing director of Optum Marine Ltd had already made an offer to TransAtlantic Distributors Ltd. In regard to this, in Stover v Manchester City Council [1974] 1 WLR 1403, it was held that an offer is referred to as an expression of willingness to contract on specified terms, and is usually made with the intention that it is to be binding once it is subsequently accepted by the person to whom it was addressed to. Besides, in Bailii, [1979] UKHL 6, [1979] 1 All ER 972, it was held that a binding contract is said to have come into existence in the instance where there is written or oral communications. For this reason, in light of TransAtlantic Distributors Ltd, the contract entered into existence after the managing director presented the firm with the offer. As such, it can be derived that the legal obligations and rights of the parties involved turn upon what their conduct and words would reasonably be understood to convey, and thus, not upon their actual assumptions or beliefs. Further, in Stover v Manchester City Council [1974] 1 WLR 1403, it was noted that a man cannot simply get out of contract by asserting that they never intended to contract if by their words they did so.

As such, TransAtlantic Distributors Ltd would claim that they had a contract with Optum Marine Ltd on the basis that the MD had expressed in writing that he indeed formulated the contract. The company would also claim that the was an objective manifestation of intent by the offeror, in this case, the managing director, to be bound by the offer if accepted by the other party. It seems that TransAtlantic Distributors Ltd accepted the managing directors offer, and this, this would legally bind them together because the offeror is bound by his words, such that a judge or any other external observer believes that he intends to be bound, even though he never had such intention. In essence, this was held in a case where a university made an offer of a place to a student who intended to join the university as a result of clerical error.

TransAtlantic Distributors Ltd accepted the offer by the managing director, which is an unqualified and final expression of an assent to the terms of the offer. However, acceptance has no legal effect until it is communicated to the offeror. In essence, the general rule, as stipulated in Partridge v Crittenden [1968] 1 WLR 1204, is that acceptance takes effect when acceptance is expressed. Regarding this, TransAtlantic Distributors Ltd called on Wednesday 12 October accepting the managing directors original offer of 450,000 for half of the Cellus storage capacity for the voyage to Hong Kong, which legalized and validated the acceptance. Even so, as stipulated in Hyde v Wrency [1840] 3 Beav 334, making a counter offer amounts to a rejection of the original offer. In essence, this is what TransAtlantic Distributors Ltd did. It is clear that On Monday 10 October 2016, TransAtlantic replied to the MD asking whether, if they bought the space, it would be available for the return journey at a discounted price of 300,000. For this reason, this is considered as a counter offer, which invalidates the original offer. As such, it can be derived that communication fails to take effect where the acceptance attempts to change the terms of the offer. As such, this would be a viable ground to invalidate Trans-Atlantic, and thus, make the contract MD invalid. For is the reason, the counter offer canceled the original offer, and thus, it does not amount to a breach of contract. As such, it can be derived that Optum Marine Ltd did not breach any contract, even after the managing director never received consent from the board, as he acted without the knowledge of the Board of Directors.

As highlighted in Lister v Romford Ice and Cold Storage Co [1957] AC 555, under common law, an employer is vicariously liable for an employees actions. Because the managing director holds a top position at Optum Marine Ltd, it translates that his actions bind the company. As such, the advice to the Chairman of the Board at Optum Marine Ltd is that the company legally bound to the deal with TransAtlantic Distributors Ltd and therefore, he is bound by the actions of the MD. However, as noted earlier, since TransAtlantic Distributors already made a counter offer, it invalidated the contract, and thus, this cannot amount to a breach of contract. Besides, the managing director of Optum Marine never agreed to the counter offer, which in itself warrants that the contract was never valid.

It can be concluded that Optum Marine is legally bound by the actions of the MD. As such, to best protect the interest of the company he has to refute the breach of contract that TransAtlantic Distributors claims because they made a counter offer, and the MD never accepted to it nor responded, which invalidates the original offer. In essence, even though the MD did not have permission to do what he did, the Global Freight deal is worth more to the company. For this reason, the chair of the board should wait to see whether Global Freight Ltd respond to their offer by this Friday. If Global Freight does not respond or accept the contract, he can reconsider that TransAtlantic Distributors Ltds deal.

Task 2: Dispute between Optum Marine Ltd and Global Distributors Ltd, Giles Farms Ltd and Industrial Trucks Ltd

Dispute between Optum Marine Ltd and Global Distributors Ltd

The dispute between Optum Marine Ltd and Global Distributors Ltd is governed by the insolvency law, which regulates companies that go into liquidation and are unable to pay the debts. However, it should be noted that both companies had validated a contract; Optum Marine Ltd was to supply 50 refrigerated crates to Global Distributors Ltd on the basis that they would be paid for in the event Global Distributors Ltd sold them. Since the crates were delivered immediately, it means that Optum Marine Ltd honoured their part of the deal, and thus, for Global Distributors Ltd to honour their part of the deal or contract, they needed to let the contract be drawn up as soon as possible. For this reason, Optum Marine supplied the goods so that they could be immediately paid for thereafter. It should be noted that all parties involved should perform their obligations; otherwise, there is a breach of contract.

A breach amounts to a failure to perform, and this warrants that the injured party to claim damages at once, as stipulated in Hochster v De la Tour (1853) 2 E. & B. 678. The supply of goods and services Act of 1982 clearly stipulates that traders must provide services to the proper standard, and if a definitive completion date or price have not been fixed, they must be completed within a specified reasonable time and charge (Palmer, 631). For this reason, since Optum Marine did their part, Global Distributors need to pay up or return the goods. Besides, in Re Grays Inn Construction Co L (1980) 1 WLR 711, it was held that all contracts that are beneficial to a company entered in good faith should be approved. As such, this means that Optum Marine should be paid or the goods need to be returned. The claim that Global Distributors became liquidated means that the trading could be fraudulent or wrongful, as stipulated in the Insolvency Act 1986 section 213, which is a criminal offense for the directors of the firm. As such, it can be derived that Global Distributors should pay up or return the crates whatever means, even if it requires a court settlement.

Dispute between Optum Marine Ltd and Giles Farms Ltd

In the case of Optum Marine Ltd selling a refrigerated crate to Giles Farms Ltd for the transport of their turnips, it is clear that the sale was agreed and the crate was paid for in full on 16 October 2016. For this reason, Giles Farms now owned the crate, for this reason, Optum Marine had the risk to Giles Farms goods, and thus, Optum Marine was responsible for the safety of the goods. As such, because the crate remained on Optum Marines premises for Giles Farms Ltd to load ahead of a sailing to France on 21 October 2016, Optum had the mandate to ensure that it was not destroyed. However, Giles Farms Ltd failed to show up on a stipulated day, as dictated by the contract where Optum Marine would transport it. In effect, this meant that Giles Farms missed the sailing. For this reason, Optum Marine had transferred the risk of having to secure the goods to Giles farms, and this, the former had no legal obligation of the goods because delivery had occurred.

According to Mylawyer (n.p), in legal terms, delivery refers to the transfer from seller to the buyer of the right to possess the goods, and this may not entail physically handing over the goods. Since the two parties had agreed what constituted the delivery of the goods, Giles Farms was legally required to remove the goods from Optum Marines premises. According to Macgregor (440-442), the buyer has the duty to secure the goods once delivered. For this reason, because Giles Farms never removed the goods, Optum Marines would not compensate any harm that befalls on them. In effect, since in a windy weather on 31 October 2016 part of the roof of a warehouse caved in and damaged the crate, Optum Marines should not compensate Giles Farms Ltd. For this reason, insisting on a full refund is void as the Giles Farms had breached the contract and never collected the goods.

Dispute between Optum Marine Ltd and Industrial Trucks Ltd

Optum Marine Ltd made a decision to buy a new fork lift truck (FLT) from Industrial Trucks Ltd, but when one of the dock workers was operating the fork lift mechanism, one broke, and in effect, it caused the load to fall and break his legs. On further analysis, the weight of the load was half the advertised capacity of the trucks, and similar reports have been received that the same issue with other FLTs made by Industrial Trucks Ltd has been experienced. For this reason, it can be derived that since Industrial Trucks Ltd made a misleading advertisement, it warrants a misrepresentation. A misrepresentation is a situation whereby a person is induced into entering a contract, partially or entirely by a false assertion of intention, opinion, or fact made by the contracting party (Davies, 15). It seems that Optum Marine relied on the advertisement to purchase the FLTs. In essence, if an individual relies on a certain statement to decide whether to go ahead with a certain purchase and subsequently, it turns out wrong, the buyer should claim compensation. For instance, in Attwood v Small (1838) 6 Cl&F 232, Mr. Small made a false statement about the capability of steelworks and mines, which he was to sell to Attwood. Attwood claimed that he would verify the statements before purchasing, and subsequently employed agents to verify, who confirmed Mr. Smalls claims, but it turned out to be untrue. It was held that Attwood could not escape the contract because he did not rely on Small to make the purchasing decision, but the agents. In contrast, Optum Marine made the purchasing decision based on the adverts of In...

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