2 - The theory of contract law Flashcards
Parts of a Contract
3 Elements:
Agreement – where there is a valid acceptance follows a valid offer
Consideration – something is given in return for something promised – providing an agreement exists
The intention to create legal relations – a clear intention to be bound by the agreement from both sides
Agreement
offer
statement made by one party, the offeror, which sets out the terms that they agree to be bound by
Acceptance
No contract is formed until an offer has been accepted. There must be a valid offer to enable a valid acceptance
Consideration
Consideration comes from the concept quid pro quo – both parties gain - eg. price paid for goods or services
Consideration and privity
It is effectively a promise and consideration
Eg. I will mow your lawn (promise) and you will pay me £20 (consideration)
Only those who are privy (parties) to the contract can sue if the contract isn’t fulfilled eg. the £20 isn’t paid for the mowing of the lawn
Consideration and economic duress
parties realise that a contract will not be fulfilled. For instance a failure to complete a building on time can have huge implications
In order to fulfil the contract one of the parties may ask for extra money in order to complete on time
The contract will only be enforced if the promise to give the extra money was given freely and without economic duress
Exclusion / Exemption Clauses
An exclusion/exemption are written into a contract by one of the parties and it can prevent liability for that party with regards to contractual breaches
There is judicial control
Effectiveness of Remedies
The effectiveness of any remedy depends on the opinion of the injured party (as money as compensation cannot always make up for the breach of the contract)
protection of the consumer
contracts are not just formed in business arrangments, but everyday life.
many business have stronge bargaining power over the consumer, parliament introduced statutes to protect the consumer
