I is a business law assignment on the various legal principles applicable from the questions

1. BUSSINESS LAW ASSIGHNMENT
The questionsthatarise fromthiscase are whether;LadyMrembois entitledtopayladyManyangathe
sumof 20,000 shillingshe hadborrowedfromher,(2)whetherladymanyanga isentitledto
compensationforhertime wastedandthe travellingexpenses incurredand (3) whetherladymanyanga
isentitledtosue the shopkeeperforbreachof contract.
The principlesapplicableinthe case are;the contractual capacityof an infant andtypesof contacts,
invitation totreat(sale bydisplay) underthe law of contracts,and the doctrine of promissory estoppel.
The contractual capacityof a party isits legal abilitytoenterintoacontractual relationship.Foran
agreementtiobe enforceable asacontract, the partiesmusthave had the requisite capacity.As a
general rule,everypersonhascapacityto enterinto contracts.However,inpractice,the law of
contracts restrictsor limitsthe contractual capacityof certainclassesof persons,namely;Infants or
minors,drunken persons,undischarged bankrupts,persons of unsoundmindandcorporations
Contractual capacityof an infant.Undersectiontwoof the age of majority act, an infantor minorisany
personwhohas notattainedthe age of eighteenyears(18).contactsenteredintobyaninfantare
binding,voidable andvoiddependingontheirnature andpurpose.
Voidable contacts.Certain contractsenteredintobyaninfantare voidable.Thatisto meanthat, the
infantisentitledto repudiatethe contractduringinfancy,orwithinreasonable time afterattainingthe
age of majority.By avoidingthe contract,the infantescapesliabilityonit.The infantcannotbe suedon
the contract duringinfancy. These contractsconferuponthe infanta longtermbenefits.Examples
Include:Partnershipagreements,lease ortenancyagreementandcontractfor the purchase of shares.
Under Section12 of the PartnershipAct,aninfantpartnerisnot liable fordebtsandotherliabilities of
the partnershipduringinfancysince the contractisvoidable athisoption.
HoweverunderSection13of the Act, if the infantdoesnotavoidthe contract during infancy, orwithina
reasonable time afterattainingthe age of majority,he isliable fordebts andotherobligations of the
firmfromthe date he became partner.
In Davisv. Beynon-Harriswhere aninfanthadtakenupa lease butfailedtorepudiate the contract
duringinfancyorwithinareasonable timethereafter,itwasheldthathe was liable underthe contact.
In relationtothis case,Lady Mremboa fourteenyearoldinwithoutdoubtaninfantandtherefore has
no legal obligationwhatsoevertopayback the amountborrowedfromLady Manyanga irrespectiveof
whethershe wasthe one whoconvincedladyManyangato lendherthe twentythousandshillingsto
buya fancyhandbag.
The other principal relate tothe lawof contact namely;offer,invitation totreatandacceptance

2. Invitation to treat:Thisisamere invitationbyaparty to anotheror othersto make offersor
bargains.
The invitee becomesthe offerorandthe inviterbecomesthe offered.
A positive response toaninvitationtotreatisan offer.Acceptance:Thisisthe external manifestationof
assentbythe offered
In relationtothiscase, ladywasmerelyinvitedtotreatundersale by display(the quotedprice of the
dress) andwishedtobuyit onlytofindout that itwas one hundred fiftythousand(150,000/=) instead
of one twentythousand shillings(120,000/=) .However,itisnotindicatedwhethershe communicated
acceptance therefore cannotsue onitsince acceptance isone of the essentialsof acontract.This means
that acceptance mustbe communicatedtothe off errorfor a contact to be enforceable byan offered
whofeelsaggrieved.
The third principal alsorelatestothe law of contact
A contract may be definedasalegallybindingagreementmade by2 or more parties.Ithas also been
defined asapromise or setof promisesabreach of whichthe law providesaremedyandthe
performance of whichthe lawrecognizesasanobligation.
The most importantcharacteristicof a contract isthat it isenforceable.The genesisof acontract
isan agreementbetweenthe partieshenceacontract isan enforceable agreement. However, whereas
all contracts are agreements,all agreementsare notcontracts.
Misrepresentation:Thisisa false representation.Itisafalse statementmade bya partyto induce
anotherto entera contractual relationship.Thisdoctrine wasdevelopedbyequity tomitigate the
harshnessof the commonlawrule of consideration.
.It isan equitable interventionwhichmodifiesthe rule of consideration.
The Doctrine was explainedbyLordDenningin Combev.Combe. Itisto the effectthatwhere parties
have a legal relationshipandone of themmakesanew promise orrepresentationintended toaffect
theirlegal relationsandtobe relieduponbythe other,once the otherhasrelieduponit andchanged
hislegal position,the otherpartycannotbe heardto say thattheirlegal relationshipwasdifferent.The
party isestoppedfromdenyingitspromise.
For thedoctrineof estoppelto applythefollowing conditionsarenecessary:
1. A legal relationshipbetweenthe parties.
2. A newpromise orrepresentationin intendedtobe reliedupon.
3. Reliance uponthe representation.
4. Change in legal positionasaresultof the reliance.
5. It wouldbe unfairnotto estopthe maker of the representation.

3. The Doctrine of PromissoryEstoppelisoftenreferredtoas “The Rule in the High Trees
Case.”
In CentralLondon PropertyTrustv.High Trees HouseLtd, the plaintiff ownedablockof flats whichit
leasedtothe defendantfor99 yearsat 2500 poundsper year.Afterthe outbreakof the
2nd worldwar, itbecame clearthat the defendantwasnotina positiontopay the agreedrentas most
of the flatswere unoccupied.The plaintiff promisedtoaccepthalf of the rentas longas the war
continued.
By the endof 1945, all the flatswere occupied.The plaintiffsuedforthe defendanttobe compelled to
pay:
1. The full rent.
2. The arrears. Thisdoctrine wasdevelopedbyequitytomitigate the harshnessof the commonlawrule
of consideration.Itisan equitableinterventionwhichmodifiesthe rule of consideration.
The Doctrine was explainedbyLordDenningin Combev.Combe. Itisto the effectthatwhere parties
have a legal relationshipandone of themmakesanew promise orrepresentationintended toaffect
theirlegal relationsandtobe relieduponbythe other,once the otherhasrelieduponit andchanged
hislegal position,the otherpartycannotbe heardto say thattheirlegal relationship wasdifferent.The
party isestoppedfromdenyingitspromise.
For the doctrine of estoppel to applythe followingconditionsare necessary:
1. A legal relationshipbetweenthe parties.
2. A newpromise orrepresentationinintendedtobe reliedupon.
3. Reliance uponthe representation.
4. Change in legal positionasaresultof the reliance.
5. It wouldbe unfairnotto estopthe maker of the representation.
The defendantarguedthatitwas inequitable (unfair) forthe plaintiff toclaimthe arrears.Itwas held
that whereasitwasfairfor the defendanttopaythe full rent,itwas unfairtoclaimthe arrears as the
plaintiff hadmade apromise whichthe defendanthad relieduponandchangeditslegal position.
The plaintiff wasestoppedfrominsistingonthe arrears.
Thedoctrineof equitableestoppelappliesin EastAfrica
In Century Automobilev.HutchingsBiemer Ltd, the defendanttookalease of the plaintiff’s premises
whichwasterminable bya3 monthnotice of eitherparty.The defendantintended tomake alterations
to the buildingbutfeareddoingsoonlyforthe lease tobe terminated.The plaintiff promisednotto
terminate the lease in4years’time.
As a consequence,the defendantspent800 poundson the alterationsbut8 monthslaterthe defendant
receivedthe plaintiff’snotice of terminationbutrefusedto honoritand wassued.

4. The defendantpleadedestoppel.The plaintiff wasestoppedfromevictingthe defendantasithad made
a promise whichthe defendanthadrelieduponandchangeditslegal position.
A similarholdingwasmade in Commissionerof Landsv.Hussein.
EFFECTS OF ESTOPPEL
The Doctrine of Promissoryestoppel isamodificationof the CommonLaw rule of considerationinthatit
enablesapersonwhohas notprovidedconsiderationtoapromise to enforce itif he has relieduponit
and changedhislegal position.
It isarguedthat the principal weaknessof the Doctrine of PromissoryEstoppel isthatitis defensive and
not offensive.Itcan onlybe relieduponbythe defendantasa defense.However, the socalledDoctrine
of ProprietaryEstoppelwhichisbasedonownershipcanbe usedboth as a shieldandasa sword.Courts
howeverhave observedthatthere isnodistinctionbetween promissoryandproprietaryestoppel.
Termsof a contract
Partiesnegotiatingacontract make many statementssome of whichare intendedtobe terms while the
othersare mere representations.Whereastermsformthe contentof the contract, representationsare
mere inducementsandif false theyare referredtoasmisrepresentations andmay andmay affectthe
contract. Whetherastatementwasintendedtobe a termor representationisaquestionof factand
courts are guidedbythe followingrulesorpresumptionsinsoascertaining:
1. Time Gap: If the durationbetweenmakingthe statementandthe conclusionof the contractislong,it
ispresumedtobe a representationandif shortitisdeemedtobe a term.
2. Guarantee:If a partyto the negotiationsappearstoguarantee itsstatements,theyare presumedto
be terms.
3. Special Knowledge:If eitherof the partieshasspecial knowledgeinrelationtothe subjectmatterof
the contract, itsstatementsare presumedtobe terms.In Oscar Chess
Ltd v. Williams, Williamssolda2nd handcar to the plaintiff.The registrationbookshowed thatitwasa
1948 model while infactitwasa 1939 car. Williamshadnomeansof ascertainingthe truth.The plaintiff
suedindamagesfor the untrue statement.However itwasheldthatsince the statementwasinnocently
misrepresented,the plaintiff hadno actionindamages.
Howeverin Dick Bently ProductionsLtdv.Harold Smith motorsLtd,the plaintiff intendedto buya motor
vehicle fromthe defendantandwasinformedthatthe vehicle inquestionhadhad a replacementengine
and gearbox andhad onlydone 20,000 miles.Infact nothinghadbeen replacedandithaddone over
100,000 miles.
The plaintiff suedindamagesforthe untrue statement.Itwasheldthatthe untrue statementwas a
termof the contract as the defendantwasamotordealerandwas therefore liable indamages forthe
misrepresentation.
Terms of a contract may be:

5. 1. Expressor
2. Implied.
In relationladymanyanga’scase itisevidentthatshe feelsaggrievedandtherefore,she is seeklegal
redresssince the court will have reasontosuspectthatherboyfriend,(BwanaTamu) knew thathe was
to travel the previousnightbutstill invitedherfor“ gettogether”hence wastinghertime andmoney.
That was an expressionof the legal principalsapplicable the turnof eventsthatensuedduringLady
Manyanga’svisitto herso called“boyfriend”.