Reference no: EM131625868

Carol is the principal founder of a business consultancy in Perth. She works in the business full-time, and her business specialises in helping small to mid-size mining firms to improve their operations and their market positioning.

One Friday afternoon, when Carol was having post work drinks with a group of colleagues, she was approached by Max, one of her connections on LinkedIn who recognised her from her profile picture. After exchanging pleasantries and talking briefly about what each other were currently involved in, Max, who owns a self-help bookshop called Inspiration Is Us, expressed to Carol that his business has experienced some hard times recently as people have moved away from buying books from independent stores like his, to buying books online or listening to audio books. Despite Max's industry being outside the scope of her own business, Carol wants to help Max to get his business back on track, and suggests to him that they meet up early in the next week to discuss how she can help him out.

When they meet the following Tuesday, Carol presents Max with an outline of how he can better market his business in order to increase his clientele. Impressed with her plan, but unsure of how to properly implement it to achieve the best results, Max proposes to Carol that she consult to him every fortnight for a period of four months, so that the implementation of the marketing strategy runs smoothly. The other terms of the proposal are that Max pays Carol $600 for each of these fortnightly sessions, and that Carol has the creative freedom to put the marketing materials together. Wanting to give Carol some time to consider what he has posed, Max requests for Carol to email him to let him know, one way or the other, by the end of the working week.

Although she doesn't need the work, Carol is excited to be involved in helping Max because she often doesn't get to create as freely for her clients in the mining industry. She calls Max the day after their meeting to communicate her acceptance of his proposal, and Max is very happy to hear this. Wanting also to have a written record of this arrangement with Max, Carol emails him on Thursday evening. In this email to Max, Carol recounts the terms of the proposal that were agreed, and reaffirms her desire to work with him on the project.

Just after a month later, a significant decline in the mining industry leads Carol's clients to draw on her services more heavily, with the effect that she is unavailable to follow through on the arrangement with Max. When Carol communicates this to Max, he is very angry and upset that he has been left high and dry, and he wants Carol to return the $1200 he has already paid in order to discharge the contract. When Carol refuses to accede to his demand and keeps the money, Max seeks advice from a lawyer concerning his legal position in these circumstances.

Question 1

What is the element of a contract for this article?

A. Intention to be legally bound

B. Agreement

C. Either formal execution in a deed; or consideration