Unit 21: Business Law M1 D1
M1 D1
Unit – 21 (Business Law)
BTEC National Diploma In Business Level 3
The Date
Author: Your Name
Your Teacher
1
,Unit 21: Business Law M1 D1
Unit 21 – Business Law
On completion of this unit I should:
1) Understand the legal requirements for a valid contract
2) Understand the meaning and effect of terms in a standard form contract
3) Understand the impact of statutory consumer protection on the parties to a contract
4) Know the remedies available to the parties to a contract
Task 3:
a) Analyse the impact of the requirements for a valid contract in a given situation.
b) Evaluate the effectiveness of terms in a given contract.
2
, Unit 21: Business Law M1 D1
Spice girls Ltd v Aprilia World Service BV (2000)
‘’Spice Girls LTD (SGl) was formed to promote the band the Spice Girls. At the beginning of
May 1998 SGL entered into a contract with Aprilia World Service BV, an Italian company
which manufactures motorcycles and scooters. The Spice Girls agreed to take part in a TV
commercial promoting the scooters.
The contract was signed at the beginning of May and Geri Halliwell left the group at the
end of May. A month before the contract was signed Geri had told the group that she would
be leaving the band. The group did not disclose this information to Aprilia World Services BV
and the contract was signed
The spice girls went ahead with the shoot even though they knew Geri would have left by
the time the commercial was due in air. This misrepresentation, according to the defendants
meant that the commercial showing the five girls was of little value.’’
http://www.legalmax.info/members2/conbook/spicegirls.htm
A contract intends to formalise an agreement between parties (contract law). The key
elements that should be available for a contract to be valid and enforceable by law are: offer,
acceptance, capacity, consideration and intention to create legal relations. In the situation
above offer was made by the ‘’ Aprilia World Service BV’’ to the ‘’ Spice Girls LTD’’,
which is the was clearly accepted and SGL representative has signed the contract; The Spice
Girls agreed to take part in a TV commercial promoting the scooters for sum of money stated
in the contract.
Considering the fact that the SGl knew that member of their band was leaving and contract
terms were asking for the full band only, it is obvious that SGl didn’t have any capacity to
sign that contract. As following, since the terms of the contract were not followed by SGl and
one member of their band was not present in the advert – there is no consideration has been
made between the two parties.
The claimants, the Spice Girls, entered into a contract with the defendant motorcycle
manufacturer under which the defendant agreed to sponsor the Spice Girls in return for
promotional work. The contract was signed on 6 May 1998. Geri Halliwell left the band on
27 May the same year. The defendant discovered that Halliwell informed the other members
of the group of her decision to leave before signing the contract. The defendants claimed they
had been induced to enter the contract by a misrepresentation. The band and its managers
denied misrepresentation.
It was held by the Court that the Spice Girls had made a misrepresentation by conduct in
that all of the members of the band at a time signing contract knew that one member was to
leave.
The group’s participation in the filming was held to amount to a representation that Spice
Girls LTD did not know and had no reasonable grounds to believe that any of the existing
3
M1 D1
Unit – 21 (Business Law)
BTEC National Diploma In Business Level 3
The Date
Author: Your Name
Your Teacher
1
,Unit 21: Business Law M1 D1
Unit 21 – Business Law
On completion of this unit I should:
1) Understand the legal requirements for a valid contract
2) Understand the meaning and effect of terms in a standard form contract
3) Understand the impact of statutory consumer protection on the parties to a contract
4) Know the remedies available to the parties to a contract
Task 3:
a) Analyse the impact of the requirements for a valid contract in a given situation.
b) Evaluate the effectiveness of terms in a given contract.
2
, Unit 21: Business Law M1 D1
Spice girls Ltd v Aprilia World Service BV (2000)
‘’Spice Girls LTD (SGl) was formed to promote the band the Spice Girls. At the beginning of
May 1998 SGL entered into a contract with Aprilia World Service BV, an Italian company
which manufactures motorcycles and scooters. The Spice Girls agreed to take part in a TV
commercial promoting the scooters.
The contract was signed at the beginning of May and Geri Halliwell left the group at the
end of May. A month before the contract was signed Geri had told the group that she would
be leaving the band. The group did not disclose this information to Aprilia World Services BV
and the contract was signed
The spice girls went ahead with the shoot even though they knew Geri would have left by
the time the commercial was due in air. This misrepresentation, according to the defendants
meant that the commercial showing the five girls was of little value.’’
http://www.legalmax.info/members2/conbook/spicegirls.htm
A contract intends to formalise an agreement between parties (contract law). The key
elements that should be available for a contract to be valid and enforceable by law are: offer,
acceptance, capacity, consideration and intention to create legal relations. In the situation
above offer was made by the ‘’ Aprilia World Service BV’’ to the ‘’ Spice Girls LTD’’,
which is the was clearly accepted and SGL representative has signed the contract; The Spice
Girls agreed to take part in a TV commercial promoting the scooters for sum of money stated
in the contract.
Considering the fact that the SGl knew that member of their band was leaving and contract
terms were asking for the full band only, it is obvious that SGl didn’t have any capacity to
sign that contract. As following, since the terms of the contract were not followed by SGl and
one member of their band was not present in the advert – there is no consideration has been
made between the two parties.
The claimants, the Spice Girls, entered into a contract with the defendant motorcycle
manufacturer under which the defendant agreed to sponsor the Spice Girls in return for
promotional work. The contract was signed on 6 May 1998. Geri Halliwell left the band on
27 May the same year. The defendant discovered that Halliwell informed the other members
of the group of her decision to leave before signing the contract. The defendants claimed they
had been induced to enter the contract by a misrepresentation. The band and its managers
denied misrepresentation.
It was held by the Court that the Spice Girls had made a misrepresentation by conduct in
that all of the members of the band at a time signing contract knew that one member was to
leave.
The group’s participation in the filming was held to amount to a representation that Spice
Girls LTD did not know and had no reasonable grounds to believe that any of the existing
3
