Retail Appointment May 2018 TRAP_May 2018_Digital Edition | Page 7
he short answer is no, you cannot
ignore it. A court or a tribunal is al-
most certainly going to find that a
contract does exist and that you are
bound by it. There may be some dam-
aging repercussions for you if you just
walk out.
T
Firstly, let us consider what
is a contract?
In English law the definition of a contract is
a legally binding agreement. It does not
have to be written at all, let alone signed.
A contract is in place where there has been:
1) An offer.
2) An acceptance of that offer.
3) Consideration – this is usually money
but can be something of value.
4) An intention to create legal relations.
Let us look at this in simple
terms:
1) I offer to sell you my lovely electric
BMW i3 in the pub one night for
£5,000.
2) Yo u accept my offer.
3) Nothing is written down.
4) Does a contract exist?
Well, there is certainly an offer, and that is
me offering to sell you my car for £5,000.
And there is an acceptance, you have
agreed to buy it.
There is definitely consideration, the
£5000.
Is there an intention to create legal rela-
tions? This is where it is open to interpre-
tation. If you are my buddy and we’ve just
finished our 6th pint of strong lager, al-
most certainly the final component “inten-
tion to create legal relations” is not there.
This is a social context and the final com-
ponent does not exist.
However, what if I have advertised my car
for sale and you had met me in the pub
for the first time for the specific purpose
of buying my car? I offer to sell it to you
for £5,000 and you accept.
Clearly, the purpose of the meeting was
to do a deal. Therefore, the intention to
create legal relations is there and the con-
tract is binding. So what happens if I
change my mind? You could enforce your
right to buy my car in the courts, or I can
force you to buy it in the courts. It doesn’t
matter that there was only a handshake
on the deal.
The reason people do tend to write down
contracts is for the purpose of proof.
What if you and I were sitting in a quiet
corner of the pub when this agreement
was reached. How do I prove we had that
agreement? This would be simply re-
solved by what a judge believes. If your
friend the magistrate or some other dis-
tinguished person was present, that may
be sufficient proof.
In an employment situation, it is very
straight forward.
The offer: Usually a letter, but can be
verbal. Do you want to come and work for
us for £40,000 per year?
The acceptance: Is not when you sign the
letter but when you turn up for work.
Having turned up for work, you have ac-
cepted that contract.
Consideration: You have accepted pay-
ment for your work.
Intention to create legal relations: All em-
ployment arrangements must be an inten-
tion to create legal relations.
In this case, your employer has offered you
a job in which there is an expressed term
that you must give the employer three
months’ notice. By turning up for work and
being paid, you have accepted that con-
tract and all its terms. Only if you had
specifically rejected that term could you
argue that you are not bound by its effect.
For example, if you had written to them
accepting the contract as a whole but re-
jecting that part, it would no longer be ef-
fective unless the employer expressly
rejects your amendment.
So, what would happen
then if you just walked out?
You would be in breach of your contract.
Your employer could sue you in the courts
for payment in lieu of notice (yes, it works
both ways) or worse still, if they suffer a
loss as a result of your premature depar-
ture, they could sue you for damages. In
practice, this rarely happens at more junior
levels, but if you are more senior, say at
director level, this could be very expensive
for you. In either case, your reputation will
be damaged and you may get a bad ref-
erence (see article on References).
Advice: If you are faced with this situation,
the only sensible course is to negotiate
with both your current and new employers.
Employers can often be angry when a
good team member gives notice, espe-
cially if you’re going to a competitor. Give
it a day or so and then approach them
again. In my experience is it very rare for
an employer to dig their heals in, and often
there is an tri-partite agreement where per-
haps you return to the old employer for a
key function/meeting. Be careful though. If
your employer requires you to stay until the
end of your notice, you will have to stay or
suffer the consequences.
Peter Burgess
Readers are welcome to respond to these articles by
visiting our website at
www.retailappointment.co.uk/POL, where they can
review other issues or make comments on this advice.
Got a new question? Just email us at
[email protected] or visit us on the
website. This advice is meant for general entertainment
purposes only and, if you have a specific issue on
which you need help, you are advised to seek the
advice of a solicitor, HR Consultant or can obtain free
advice from ACAS.
“I offer to sell you my lovely BMW i3 in the pub
one night for £5,000.”
retailappointment.co.uk
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