1. Whether Mr. Shaw had failed to provide consideration in exchange for Mr.

Hobbs'
promise to pay 1 million if he sold 100,000 wrenches:

The High Court made an error in distinguishing this case with William v Roffey brothers
and MWB v Rock advertisement in concluding that Mr. Shaw did not provide any
practical benefit or consideration.
We submit that [i] Mr. Shaw went over and above the “best endeavor” requirement. [ii]
Mr. Shaw did provide a consideration and he gave a practical benefit or obviated a
disbenefit to Mr Hobbs. Also, [iii] Mr Hobbs gave an indemnity promise regarding
against the No Oral Modification clause.

[i] Mr. Shaw fulfilled his best endeavours requirement (A) and went over and
above the requirement. (B)
(A) Mr. Shaw fulfilled his best endeavours requirement

The term best endeavours is frequently utilized in commercial contracts. Various terms
commonly used include best endeavours, all reasonable endeavours, reasonable
endeavours, best efforts, and reasonable efforts. best endeavours would require a party
to “take all those steps in their power which are capable of producing the desired
results”1

In the case of Sheffield District Railway Company v Greater Central Railway Company
(1911)2, the court stated that best endeavor means “a service provider is obligated to
complete all the steps available to try to achieve the objective”.

Here, Mr. Shaw took all the necessary steps in his power to fulfil the variation of the
agreement. As a managing director Mr. Shaw is responsible for sales, marketing and
distribution efforts, ensuring profitability and market expansion. To sell 100,000
wrenches in a year Mr. Shaw dedicated all available resources to support the promotion
and distribution of wrench products, invested in marketing and hired a sizable team of
salespersons.Also added wearchouse facilities despite not having sufficient fund.

(B) Mr Shaw went over and above the best endeavour requirement.

(B) Mr. Shaw went over and above the requirement of best endeavours by
overstepping the reasonable limit to achieve the object. In the case of Sheffield District
Railway Company v Greater Central Railway Company (1911), the court stated to prove
1
IBM United Kingdom Limited v Rockware Glass Limited CA [1980] FSR 335
2
Sheffield District Railway v Great Central Railway (1911) 27 T.L.R. 451
best endeavours do not mean that one has to “overstep the limits of reason” and the
court phrased that what is ‘over steeping the reasonable limit’ which is:

1. No need to sacrifice a specific interest for its own.

2. No need to replace or sway away its own traders to the competing routes.

Mr. Shaw terminated relationships with other suppliers to prompt Mr. Hobb’s business. 3
By making this decision Mr. Shaw gave up a specific interest or benefit. When someone
promises to do their ‘best endeavours’ under a contract. They don't have to put
themselves in financial trouble or harm themselves just to satisfy the other party's
interests.4 They "do not mean that the a party must so conduct its business as to offend
its traders "and drive them to competing routes. Mr. Shaw repeled his own suppliers to
the competing routes. which brings financial trouble in his business. Here, It is
overstepping the reasonable limits of best endeavour requirement.

Also, in the case of Terrell v Mabie Todd & Coy LTD. (1952), It is stated that in order to
fulfill the ‘best endeavors’ obligation, a party must pay expenses, while it is also free to
look at its own financial circumstances. Thus, it seems reasonable that a business with
more resources would have to do more than one with less. Means a party does not
have to jeopardize its own financial circumstances in order to provide best endeavours.
Here, how much Mr. Shaw can expand his business depends on his resources, but he
did not have enough resources to run his business. Mr. Shaw exhausted all his financial
limits. During the refurbishment of the warehouse, he couldn’t even provide a mere
2000 pounds and had to rely on the funding of Mr. Hobbs. He pushed his limits despite
having the lack of resources
The standard of ‘reasonableness’ is that of a reasonable managing director acting
properly in the interests of his company and applying his mind to his contractual
obligations to exploit the inventions.5 The facts show that Mr. Shaw managed the
business despite the lack of resources, so the effort he gave was unreasonable and did
over and above his original contractual obligation.
In the case of Hartley v Ponsonby(1857),6 the court distinguished this case by finding
that the promise was enforceable because the promisee were fulfilling duties that went
beyond their initial contractual obligations.Going over and above is itself a
consideration. So, even if Mr. Shaw did not provide any practical benefit still it will be
considered as a consideration for doing over and above. It is important to note that Mr.
Shaw sold 102,000 wrenches, he sold 2000 wrenches more than his contract. So he
provided enough consideration in his contractual obligation.

[ii] Mr. Shaw did provide a consideration by giving a practical benefit to Mr.
Hobbs and obviated from disbenefit.
3
Page2-para 5
4
Eastwalsh Homes Ltd v Anatal Developments Ltd 1990 Carswell 532(CA)
5
Terrell v. Mabie Todd & Coy. Ld. para-45
6
Hartley v Ponsonby [1857] 7 EL BL 872; 119 ER 1471
The case of William v Roffey bros & Nicholls 1991 (COA decision)7 supports the above-
mentioned statement.

There is a general rule by the case of Stilk v Myric(1809)8, which says when a promisee
does something under a contract obligation, the promisee can not use the performance
of the promise as a consideration for a contractual variation or a new contract.
But In this case of William v Roffey bros & Nicholls9 , it was held that performance of an
exciting duty owed to the promisor could constitute good consideration if the promiser
gained a practical benefit. Gildewell LJ established five requirements for the doctrine of
practical benefit to be applicable.

Here, Mr. Hobbs obtained a certain practical benefit. Which fulfilled all 5 requirements
for the doctrine of practical benefit given by Glidewell LJ:

‘(i) f A has entered into a contract with B to do work for, or to supply goods or services
to, B in return for payment by B: Mr. Hobbs entered into a for years of contract with Mr.
Shaw sold chromium vanadium alloy steel wrenches and Mr.Shaw committed to sell as
many wrenches as possible by earning 12% commission from the profits.

(ii) at some stage before A has completely performed his obligations under the contract
B has reason to doubt whether A will, or will not be able to, complete his side of the
bargain: A year after their contract Mr. Hobbs had reason to doubt whether Mr.Shaw will
not be able to sell enough wrenches to make the business profitable.

(iii) B thereupon promises A an additional payment in return for A’s promise to perform
his contractual obligations on time; Mr. Hobbs promises to give 1 million bonus if Mr.
Shaw could achieve 100,000 wrenches by next calendar year.

(iv) as a result of giving his promise, B obtains in practice a benefit, or obviates a

disbenefit: Mr.Shaw was able to sell 100,000 as per the contract and Mr.Shaw was
economically viable for the wrenche sells. Also Mr.Hobbs was about to leave his
wrenche business but for the profitability of the wrenche business which was ensured
by Mr. Shaw, Mr. Hobbs no longer needs to close the business. Here, Mr. Hobbs
obtained it by a disbenefit.

(v) B’s promise is not given as a result of economic duress or fraud on the part of A:
Mr.Shaw did not commit any economic duress or fraud.

Mr. Shaw's other actions, including investing in marketing, and hiring a dedicated sales
team, all constitute valuable consideration in exchange for Mr. Hobbs' promise. and the
failure to recognize Mr. Shaw's consideration was a grave error of law. Which
established he gave enough consideration.

7
Williams v Roffey Bros & Nicholls (Contractors) Ltd [1989] EWCA Civ 5
8
Stilk v Myrick (1809) 170 ER 1168
9
Ibid
[iii] Mr. Hobbs gave a indemnity promise to Mr. Shaw for his obligation,
(a)indemnity, (b) restitution (c) loss of amenity as Shaws reputation as a seller is
damaged.

In the case of Canadian Pacific Railway Co. v. London & Scottish Assurance
Corporation (1925)10, Lord Buckmaster defined an indemnity contract as follows:
"An indemnity is a promise by one party to keep the other harmless against loss which
the latter may sustain by reason of some act or conduct of the former or by some act of
some third person."

Here, Mr.Hobbs gave a indemnity promise and assurance to Mr. Shaw that he will give
1 million pounds for 100,000 wrench sales. Mr. Shaw fulfilled all his duties, sacrificed his
own commercial interest and achieved the task relying on Mr.Hobbs promise. Mr.hobbs
non-payment is loss of amenity for Mr. Shaw.
By not giving Shaw his Entitled £1 million for going over and above is not only a breach
of the initial agreement, but also a breach of the Indemnity Clause. Hobbs is obliged not
to rely on the class 5.3 under the indemnity clause. Which makes sure entitled for the
money.
(b) demant restitution wun just enrichment of the defendant at the expense of the
claimant. hobbs er enrichment hoise; agei prove korsi by proving practical benefit. at
shaw er expense ei hoise, agei prove korsi he went over and above. (best arguement)

© Loss of amenity refers to the reduction or deprivation of one's ability to enjoy or derive
satisfaction from the normal aspects of life due to injury, harm, or other adverse
circumstances.11 In the case of Ruxley Electronics v Forsyth [1996]12, Lord Mustill states
that in cases where a contract is designed to fulfill a purely commercial purpose the loss
will normally consist of only monetary detriment. Detriment can take various forms, such
as the loss of reputation, time, money, or other valuable resources. Mr. Shaw has
incurred a loss or suffered a disadvantage that would not have happened had the
contract not been entered into. Here, Mr.Hobbs sold inferior quality wrenches as well
that can damage the reputation as seller.
Mr. Hobbs breached the indemnity promise and for that Mr.Shaw faced loss of amenity.
Mr. Hobbs will be liable for the breach of contractual variation and damage for loss of
amenity.

Pleading 2 shaw

Mr. Hobbs can not rely on the clause 5.3 to argue that the oral agreement was
unenforceable as (a) The oral agreement was followed by a conduct (b) The NOM clause
10
Canadian Pacific Railway Company v. Fleming (1893) 22 SCR 33
11
Ruxley Electronics v Forsyth [1996] AC 344
12
ibid
should be ineffective (c) There had been a Doctrine Of Equitable Estoppel (d) The oral
agreement is a new agreement and not a variation of the previous contract and (e)
Internationally no-oral modification clause doesn’t have a formal effect.

(a)The oral agreement was followed by a conduct

I. A "no oral modification" clause is a common business practice that included in
contracts to require that any changes to the contract be made in writing and signed by all
parties involved. From the statement facts, it’s clear that Mr. Shaw has acted according to
the oral promise of Mr. Hobbs. He didn’t just made conduct but he also worked over and
above and did everything possible even at the cost of his own financial situation just to
safeguard Mr. Hobbs. From the judgments of Rock Advertising Ltd v MWB Business
Exchange Centres Ltd [2018] UKSC 2413
the judges were on the fact that “The law does give effect to the provisions of the party
has acted according to the oral agreement and the court will found that the parties had
agreed to modify the agreement orally, despite the presence of the no oral modification
clause.”

So it’s clear that Mr. Shaw has worked according to the oral agreement and thus the
NOM clause should not be invoked.

(II) Mr. Shaw has acted in reliance to the oral agreement. Not only Mr.Shaw just didn’t
give up other suppliers but he also hired a new sales team to complete the oral agreement
and bought a new warehouse so that he can complete the target and get the bonus
amount. According to the case of Rolls Royce Holding PLC and Goodrich Corp 202214
“One party can not rely on the no oral modification clause if the other party has relied on
the oral modification and acted according to it”

As Mr. Shaw acted according to the oral agreement so Mr. Shaw can not rely on the
NOM clause.

(b) The No Oral Modification clause should be unenforceable

(I) Mr. Shaw made Mr. Hobbs aware regarding the NOM clause as part of his duty and
they had a discussion between the parties regarding the No Oral Modification Clause.
From the facts, it’s clear that Mr. Shaw did ask Mr. Hobbs regarding the NOM clause
while going for the oral agreement and Mr. Hobbs gave his words to him that the NOM
clause won’t be a issue in between their agreement. According to MWB Business
Exchange Centres LTD v Rock Advertising LTD-201815 when the parties act in a non
compliance manner by discussing and reach a agreement , the oral agreement is at least at
the conceptual level no more or less effective than simply including a NOM clause in the
contract.
13
MWB Business Exchange Centres Ltd [2018] UKSC 24
14
Rolls-Royce Holdings Plc v Goodrich Corporation [2023] EWHC 1637
15
ibid
As there had been a discussion between the parties the oral agreement is completely
enforceable.

(II) The oral agreement didn’t create any misunderstanding between the parties. The
parties were completely aware of their contractual duties and Mr. Shaw acted upon it.
Even, the oral agreement didn’t do anything radically different from the previous
agreement. According to MWB Business Exchange Centres LTD V Rock Advertising
LTD (above) one of the reasons of including a NOM clause is to avoid
misunderstandings between the parties.
As there is no misunderstanding between the NOM clause should be ineffective.

(III) The oral variation was completely relied upon by Mr. Shaw. Where one party
clearly rely upon the other, this indicative that the statement was intended to be a term.
Esso petroleum v Mardon.16 As Mr. Shaw relied upon the statement the oral variation
was a term and as being a term it can not be excluded by a NOM clause .

(C) Mr. Hobbs should estopped from relying on clause 5.3

(I) There had been an express promise or representation on which Mr. Shaw has relied.
From the facts, it’s clear that Mr. Hobbs did a proper and express representation
regarding the requirement of £1000,000 bonus against of selling 100,000 wrenches.
According to the case of Brikom Investments LTD v Car -197917 Lord Denning brushed
aside an entire clause believing that “ the cases are legion where a clause should be of no
effect where an express promise and representation had been made” and according to the
case of UK learning academy V Secretary of State For education 202018 where there
had been a representation the other is estopped from relying on the NOM clause.

So as there had been a representation or promise Mr. Hobbs is estopped from relying on
the NOM clause.

(II) Mr. Hobbs has provided indemnity to Mr. Shaw. According to the facts Mr. Hobbs
has given assurance to Mr. Shaw that no matter what happens Mr. Shaw will paid for his
conduct. According to the case of Pao On V Lau Yiu Long (1980)19 as there had been an
indemnity promise, the price should pay in accordance with the indemnity.

As Mr. Hobbs has provided express promise or representations and indemnity promise to
Mr. Shaw, he should be estopped from relying on the 5.3 clause.

16
Esso Petroleum v Mardon [1976] QB 801
17
Brikom Investments Ltd v Car ([1979] Q.B. 467, CA (Eng)
18
UK Learning Academy Ltd v Secretary of State for Education [2020] EWCA Civ 370
19
Pao On v. Lau Yiu Long [1979] UKPC 17
(d). The oral agreement is completely a new agreement.

(I) The collateral agreement is an agreement and is supported by its own

consideration. Not only Mr. Shaw has given new consideration for the oral agreement but
also there had been a totally new circumstance in regards of dealing where they meet to
discuss the agreement. According to the cases of Business Environment Bow Lane LTD
and Dean Water Estates LTD -200720 and North Eastern Properties LTD21 and
Coleman -2010 “ the oral agreement is capable of operating as an independent agreement
and if it’s supported by it’s own consideration the most standard forms of entire
agreement clause will not prevent it’s enforcement”

So, as the oral agreement is totally a new agreement and it is supported by its own
consideration, 5.3 clause can not stop its enforcement.

( e ). International NOM clauses does not always have a legal effect. The reasons
advanced in the case law for disregarding them are entirely conceptual. The argument is
that it is conceptually impossible for the parties to agree not to vary their contract by
word of mouth because any such agreement would automatically be destroyed upon their
doing so. The difficulty about this is that if it is conceptually impossible, then it cannot be
done, short of an overriding rule of law (presumably statutory) requiring writing as a
condition of formal validity. Yet it is plain that it can. There are legal systems which have
squared this particular circle. They impose no formal requirements for the validity of a
commercial contract, and yet give effect to No Oral Modification clauses. The Vienna
Convention on Contracts for the International Sale of Goods (1980) has been ratified by
89 states, not including the United Kingdom. It provides by art 11 that a contract of sale
“need not be concluded in or evidenced by writing and is not subject to any other
requirement as to form.” Nonetheless, art 29(2) provides: “A contract in writing which
contains a provision requiring any modification or termination by agreement to be in
writing may not be otherwise modified or terminated by agreement. However, a party
may be precluded by his conduct from asserting such a provision to the extent that the
other party has relied on that conduct.” Similarly, art 1.2 of the UNIDROIT Principles of
International Commercial Contracts, 4th ed (2016), provides that “nothing in these
Principles requires a contract, statement or any other act to be made in or evidenced by a
particular form.” Yet art 2.1.18 provides that “A contract in writing which contains a
clause requiring any modification or termination by agreement to be in a particular form
may not be otherwise modified or terminated. However, a party may be precluded by its
conduct from asserting such a clause to the extent that the other party has reasonably
acted in reliance on that conduct. “These widely used codes suggest that there is no
20
Business Environment Bow Lane Ltd v Deanwater Estates Ltd [2007] EWCA Civ 622
21
North Eastern Properties Ltd v Coleman & Quinn Conveyancing [2010] EWCA Civ 277
conceptual inconsistency between a general rule allowing contracts to be made
informally and a specific rule that effect will be given to a contract requiring writing for a
variation.

So, it’s clear that Mr. Hobbs shouldn’t be included with the authority to reply on the 5.3
clause.

Pleading iii: Shaw

[A]- Mr. Shaw does not need to pay any damage to Mr. Hobbs, as (a) does not provide
any specific relief or damage for the breach of that clause. (b) the exclusivity clause Mr.
Hobbs is relying on is unfair, (c) Mr. Shaw was going through economic complications,
(d) The damage is not linked with the breach

1. In business contracts, an exclusivity clause typically grants one party the exclusive
right to provide certain goods or services to another party within a specified scope, such
as a particular geographic area, industry sector, or for a defined period. The earliest
example regarding exclusivity clause can be found in the case of Nordenfelt v. Maxim,
Nordenfelt Guns and Ammunition Co. [1894].22
There had been no specific damage or relief for the breach of the exclusivity clause. In
EE LTD v Virgin Mobile LTD(2023),23 English and Wales Kings Bench Division, Mrs.
Justice Joanna Smith DBE in her judgment affirmed on the para [100] that “
{manufacturer}EE contends that On VM’s interpretation of clause 34.5 {exclusivity
clause} ,’ EE would have no remedy at all’ for VM’s breach of the exclusivity clause,
depriving it of all contractual force and turning it in to a mere statement of intent. So, in
this regard Mr. Hobbs is not entitled to any kind of relief or damages while relying on the
exclusivity clause.

(b) The exclusivity clause is unfair;

(I) A vertical relationship in a business contracts are a relationship that typically

describes that one party has a dominating position in the agreement than the
other party such manufacturers and distributors. From the facts provided,
Hobbs oversees the overall operation and growth initiative of the business
while Mr. Shaw was just there for mere implementation which establishes Mr.
Hobbs position in this contract as a dominant party.

22
Nordenfelt v Maxim Nordenfelt Guns and Ammunition Co Ltd [1894] AC 535
23
EE Ltd v Virgin Telecoms Ltd [2023] EWHC 1989 (TCC).
Under the Competition Act 1998, article 1 provision 2(1)(b) Ss.2(b) and Ss2(d) provides
that the dominant party can not impose any restriction that completely cuts off the
competition or investment or finance for the other party.

And from the Competition Act’s Vertical Agreement Block Exemption order 2022
confirms under S.8 it’s provided that dominating party cannot impose such restriction
which turns out to be a hardcore restricting in manner of concluding the party with only
one supplier or source of goods. So, it clear that the clause was unfair in regards of
Competition Act 1998.

From the above-mentioned discussion, it’s clear that not only the clause was ambiguous
due to it is unclear nature regarding damages or reliefs but the clause was also a clear
abuse of dominant position in the agreement and thus the clause shouldn’t even stand in
the contract.

(II) From the facts another thing is clear that regarding the Exclusivity Clause, the clause
was unilaterally decided by Mr. Hobbs whole Mr. Shaw just implemented it rather than
having an independent discussion on it. We should also look upon the recent Court Of
Justice of European Union (CJEU)’s decision between Unilever and The Italian
Competition Authority, where CJEU ruled that,
“where exclusivity clauses are applied via distribution network, the distributors use of
such clauses should be imputed to the dominant company if the clauses were unilaterally
decided by the dominant company and simply implemented through its distributors,
rather than being independently adopted by them.” So, it’s totally certain that the clause
wasn’t just unfair but it’s also had been a showcase of abuse of a dominant position.

(c) Mr, Shaw was also going through economic complications. The exclusivity clause
puts an obligation to have Mr. Hobbs as his sole supplier. As,Mr. Shaw was completely
dependent for his business to Mr. Hobbs when Mr. Hobbs went through a loss due to the
overwhelming decking in wrench sale Mr. Shaw had terrific effect to his business and
was going through a loss. From the decision of Northamber PLC v Genee World Ltd
and other-202224 in EWHC Chancery Division, Judge Rawlings sitting as High Court
Judge stated that “In any event supplying resellers in the UK in order to survive, the
distributors can have other suppliers, even if such supplies did constitute a breach of
exclusivity clause”
As due to the abusing nature of the clause Mr. Shaw was at the verge of losing his
business it was justifiable for him to go for other suppliers to survive.

(d) The damage is not linked with the breach;

24
Northamber Plc v Genee World Ltd & Ors [2020] EWHC 31
(I) It’s clear from the fact that Mr. Hobbs hadn’t went through any loss due to Mr. Shaw
having another supplier and as as Mr. Hobbs suffered no loss there is no legal cause for
Mr. Hobbs to ask for damages.Even Mr. Shaw went over and above to make sure that Mr.
Hobbs doesn’t face any loss. From the decision in EE LTD v Virgin Mobilf Ltd (above)
of para [44],25 “ I am fortified in this view by the decision of Leggatt J (as he then was) in
Yam Seng Ptd Ltd v International Trade Corp Ltd [2013] EWHC 111 (QB) at [177]-
[185].26

As Leggatt J explained, a claimant is not entitled to damages for breach of an exclusivity

obligation on the expectation measure if it cannot “prove what profit it would have made
or indeed that it would have made a profit at all if [the party in breach] had fully
performed its obligations under the agreement”. _ BOSS LINE

A claim for “loss of revenue” that does not give credit for the costs incurred by the
claimant so as to reflect only the claimant's loss of profit plainly falls foul of the
expectation measure and the overriding compensatory principle.”
Mr. Hobbs had suffered no loss due to any breach even if it happened as his wrenches
had been sold and Mr. Shaw has helped him to recover in business so Mr. Hobbs isn’t
entitled to any kind of Damages.

(II) The damage isn’t identifiable. Even if any breach happened to the exclusivity clause
there is no evidence that Mr. Hobbs had suffered any loss. In Lord Bingham’s decision in
White Arrow Express LTD V Lamey’s Distribution LTD [1996]27 he stated that, “ The
Robinson v Harman formulation assumes that the breach has injured the party’s financial
position; if he can not show that it had, he will recover nominal damage only” There has
been no evidence that Mr. Hobbs has faced any loss or had any adverse financial effect
due to the decision of Mr. Shaw and it’s clear that it had no financial effect as Mr. Shaw
completed his duty to sell 100,000 wrenches so there had been no damage faced by Mr.
Hobbs.

(III)There was no communication regarding the breach of the exclusivity clause. Even if
any breach happened, Mr. Hobbs had a duty to communicate regarding the breach From
the facts, it’s clear that Mr. Hobbs did not communicate with Mr. Shaw regarding the
issues. In the case of Vitol SA v Beta Renowable SA [2017]28 Lord Steyn in his
judgment conveyed that the innocent party must communicate his decision to the party in
breach and the communication must clearly and unequivocally convey to the repudiating
party.

25
EE LTD v Virgin Mobilf Ltd (above) of para [44]
26
Yam Seng Ptd Ltd v International Trade Corp Ltd [2013] EWHC 111 (QB) at [177]-[185].
27
White Arrow Express Ltd v Lamey's Distribution Ltd [1996] Trading LR 69
28
Vitol SA v Beta Renowable SA [2017] EWHC
As. Mr. Hobbs did not communicate he is not entitled to damages.

Mr. Hobbs also affirmed the contract. From the facts, it’s clear that Mr. Hobbs waited for
Mr. Shaw to finish the variation of the contract, which shows that Mr. Hobbs accepted
further performance of the contract and has affirmed the contract. According to the case
of, Davenport v The Queen-1877,29 “An innocent party who accepts further performance
after the breach of the contract, held there by to have affirmed the contract.”

Pleading 4:
The high court gave judgment by saying Mr. Hobbs does not have to pay damages to Mr.
Shaw in relation to the warehouse repairs. We submit that. [i] there was no acceptance of
the offer of making the floor with inferior material [ii] There was misrepresentation
regarding the material of the floorings. [iii] There was tort of negligence. (IV)
Obligations that arises under the Sales Of Goods Act 1979

[i] Mr. Shaw never accepted the offer of making the floor with inferior material.

Acceptance is the final and unqualified expression of assent to terms proposed by the
offeror.30 Acceptance should follow the ‘mirror image rule’, as there needs to be a mirror
image acceptance of the offer. An acceptance must exactly match all the terms offered.31
Mr. Shaw did not accept the offer of making the floor with the inferior material.
The general rule is that acceptance of an offer will not be implied from the mere silence
on the part of the offeree.32 Though silence can be a form of acceptance in this matter.
One can accept the offer by remaining silent but the offeror has to mention that he is
accepting the offer by the conduct of the offeree for being silent.33 But there was no
conduct form Mr. Shaw. In the general rule acceptance can be made by conduct.
It must be demonstrated that the offree acted with the objectively judged intention of
accepting the offer for the activity to be considered an acceptance.34 Here, Mr. Shaw was
not clear about the changes because Mr. Shaw relied on the representation of precision
Builders. Even if Mr. Shaw accepts through conduct, it can not be valid acceptance
because there was a misrepresentation by Mr. Hobbs.

Also, there was no communication for the acceptance. mere mental assent is not
29
Davenport v The Queen (Queensland) Privy Council
30
Hyde v Wrench [1840] EWHC Ch J90
31
Gibson v Manchester City Council [1979] UKHL 6
32
Felthouse v Bindley [1862] EWHC CP J35
33
Rust v Abbey Assurance company. [1969]
34
Day Morris Associates v Voyce [2003] EWCA Civ 189
sufficient.35 The offeree is assenting to an offer in his mind only and not communicated it
to the offeror.

[ii] There was misrepresentation regarding the material of the floorings.

Misrepresentation is a false statement of fact, which is addressed to the party misled,
whilst not being a term of a contract, which is material and induces the other party to
enter the contract and it was relied upon. to consider a misrepresentation it should fulfill
all the requirements of a misrepresentation:
(a) firstly. there has to be an unambiguous statement of fact which was false.36 This false
statement must be material, meaning it influences the decision of the other party, and the
other party must reasonably rely on it. Here, the false statement was that precision
builders assured that the use of urethane-based flooring does not compromise on quality
or durability.
(b) secondly, after establishing the dispute statement it must be shown the statement was
addressed to the party misled indirectly. It can be addressed by the representator to a third
party with intention that it be passed on to the claimant.37 here, Precision builders was the
representor and Mr. Hobbs acted as an agent who passed it to Mr. Shaw.

( c) There was an inducement which will lead representee to enter into the contract. The
false statement Induced Mr. Shaw to enter into the contract. Also, the misrepresentation
had materiality and there was a reliance.38 There will be no reliance if the representee
does not reply on the misrepresentation but on his own judgment or investigation.39 But
even if the claimant has investigated, partial reliance on misrepresentation is sufficient.40
(d) There is no general duty to check a representation, Here, one of the technicians
informed Mr. Shaw of the slight abrasions seen on the flooring but the investigation
happened after the flooring was made and Mr. Shaw was already induced by the
misrepresentation. So, there was partial reliance.
The misrepresentation caused loss to Mr. Shaw because he will not be able to store any
wrenches for his business. Although there was a frustrating event for the destruction, but
the damages of the flooring could have been prevented if Precision Builders did not
compromise the quality and durability of the flooring.

Thus far we have proved that there has been a misrepresentation from Precision Builders
and Mr. Hobbs acted as an agent for Precision Builders. Now, Whether Mr. Hobbs is
innocent or not; the burden of proof for innocence is on Mr. Hobbs. Even if Hobbs proves
that it was an innocent misrepresentation from him as had “reasonable grounds to believe
35
Entores v Miles Far East Corp [1955] 2 QB 327
36
McInerny v Lloyds Bank Ltd [1974] 1 Lloyd’s Rep 246; Avon Insurance plc v Swrie Faser Ltd [2000]
1 All ER (comm) 573
37
Commercial Banking Co of Sydney Ltd v R H Brown & Co [1972]HCA 24
38
Museprime Properties v Adhill properties [1990] 36 EG 114
39
Attwood v Small (1838) 6 CI & F 232
40
Edgington v Fitzmaurice (1885) 24 Ch D 459
and did believe up to the time the contract made that the facts represented were true” Mr.
Hobbs would still be liable for rescission under this case. Since a major alliteration has
happened with the flooring after the flood, rescission is not possible.
Now, Mr. Shaw will get rescission or damages in “lieu of rescission” under section 2(2)
of misrepresentation act 1967. The right to rescind the contract may be lost in
accordance with the section 2(2) of the misrepresentation act 1967 if the court decides to
grant the claimant damages rather than withdraw the contract. Court try to give some
logical option in this section.
In the case of Willam Sindall v Cambridge county council, the Court of Appeal found
that if there had been an innocent misrepresentation, damages would have been granted
rather than the contract being terminated under section 2(2).
So, Mr. Shaw damages will be awarded rather than the contract being canceled.

[iii] There was tort of negligence.

The tort of negligence holds people or organizations liable for harm they cause by not
taking reasonable care. When someone breaks a duty of care they owe another person and
causes harm or damage that could have been avoided, this is called negligence.

The following elements will establish the claim of negligence:

Duty of Care: The duty can be owed to class or person. here, Mr. Hobbs and Precision
builders owed a duty of care to Mr.Shaw . A duty of care is a legal requirement to act
reasonably in order to avoid causing harm to others. In the case of, Junior v Veitchi and
Co[1983],41 the House of Lords ruled that the defendant was liable for negligent
misstatement and breach of duty of care in the installation of a concrete floor. The court
held that even though there was no direct contract between claimant and defendant, the
defendant owed a duty of care as it was reasonably foreseeable that claimant would rely
on defendants expertise in the installation of the floor.

also, The judgment in Donoghue v Stevenson (1932),the court held that defendant, owed
a duty of care to claimant as a consumer of their product. This duty required defendant to
take reasonable care to ensure that their product was safe for consumption. This judgment
established the principle of negligence in the tort of negligence and had significant
implications for product liability and consumer protection laws.
here, Mr. Shaw was entitled to succeed in an action in tort because of the extremely close
relationship between Mr. Hobbs and Precision Builders. The crucial elements in the
relationship appear to be firstly, the fact that Mr. Shaw relied upon the skills of precision
builders to do the work and secondly, the fact that Mr. Hobbs assumed a responsibility
towards Mr. Shaw because of the structure of the contract.

Breach of Duty: Precision builders breached that duty by failing to act as a reasonably
41
Junior v Veitchi and Co Ltd [1983] 1 AC 520
prudent person. Where, Precision Builder used low quality material and there was a
misrepresentation from Precision Builders and Mr.Shaw [ii] This breach involved an
action or a failure to act when there was a duty to do so.

Causation: The breached caused the damage and it is a legal causation. The harm was a
reasonably foreseeable consequence of Precision Builders’ actions. Because Precision
Builders were experts and they know that the location of the warehouse in a humid town
and low-quality material will not be sufficient for the flooring. In the case of Esso
Petroleum Co Ltd v Mardon [1976],42 The court found in favor of claimant, holding that
the defendant had a duty of care to provide accurate information and had breached this
duty by providing misleading estimates. Since warehouse flooring material was not
durable which caused the damage. And Mr. Shaw will not be able to use the warehouse in
future for the damage. The warehouse has been commercially unusable.

Mr. Hobbs is vicariously liable for Precision Builders damage. Because Mr. Hobbs haired
Precision Builders. In the case of Various Claimants v. Catholic Child Welfare Society
[2012],43 The Supreme Court clarified that in certain circumstances, such as where a
special relationship exists between the parties or where there is an assumption of
responsibility, an entity may be vicariously liable for the negligence of another party,
even if there is no direct employment relationship.

(IV) According to the Section 14(2) of the Sales Of Goods Act 1979 where the seller
sells goods in the course of a business, there is an implied condition that the good supply
under the contract are of satisfactory quality. From the facts, it’s clear that the flooring
material weren’t of satisfactory quality because of which the abrasions started seeing with
in a few weeks. Thus, Precision Builders breached the Sales Of Goods Act 1979.

Damages: here, Mr. Shaw suffered actual damages as a result of the Precision builders
and Mr. Hobbs breach of duty. These damages can include property damage of the
warehouse, commercial loss, and or emotional distress for not being able to continue to
use the warehouse.

42
Esso Petroleum v Mardon [1976] QB 801
43
Various Claimants v. Catholic Child Welfare Society [2012] UKSC 56