Agreement Flashcards by Emma preece

Test for intention is objective

Smith v Hughes

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Subjective intention will only be considered where the offeror has made a mistake and the offeree ought to know/knew about it.

Hartog v Colin & Shields

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Definition of a contract

An agreement giving rise to obligations which are enforced or recognised by law (Treitel)

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Definition of an offer

An expression of willingness to contract on specified terms made with the understanding that it is to become legally binding as soon as it is accepted by the person to whom it is addressed (Treitel)

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Definition of a unilateral offer

An offer under which only the offeror assumes an obligation and which demonstrates intention to be bound and is only accepted by actual performance of the required act. Promising to act is insufficient. (Carlill v Carbolic Smoke Ball)

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An offer must be clear and certain

Gibson v Manchester City Council (may - insufficient);

Storer v MCC (will - clear and certain)

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Definition of an invitation to treat

the first step in negotiations which may of may not lead to a firm offer and is not binding.

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Display of goods for sale is an invitation to treat, not an offer

Fisher v Bell (flick knife)

Pharmaceutical Society of GB v Boots

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Generally, adverts are an invitation to treat

Partridge v Crittenden

Harris v Nickerson (auction)

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Exception to the advertisement rule: where the supplier is also the manufacturer

Grainger v Gough

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Exception to the advertisement rule: where the advert amounts to a unilateral offer

Carlill v Carbolic Smoke Ball - clear prescribed act, performance of which constitutes acceptance, intention to be bound.
No requirement for those accepting to communicate acceptance

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Unilateral offer “first come first served”

Lefkowitz v Great Minneapolis Surplus Store

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Invitation to tender is an invitation to treat. Requestor is not bound to accept the most competitive offer

Spencer v Harding

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Where the invitation to tender expressly contains a promise to accept the highest/lowest bid, this is binding

Harvela Investments v Royal Trust of Canada

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Invitation to tender may be construed as an offer with different term e.g. an offer to consider bids (not accept)

Blackpool & Fyde Aero Club

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Auctions: auctioneer’s request for bids is an ITT; bidder makes offer, which auctioneer accepts with the fall of the hammer. Bidder can revoke any time before the hammer falls

Payne v Cave

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In auctions without reserve, the auctioneer may be sued for breach of contract if he refuses to sell to the highest bidder

Warlow v Harrison, confirmed in Barry v Davis

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Offer must be communicated

Taylor v Laird

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Offer may be communicated to the whole world

Unilateral offer - Carlill

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Counter-offer is a rejection of the original offer which cannot be later accepted

Hyde v Wrench

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Request for information - ancillary matter, interrogatory language

Stevenson, Jacques & Co v McLean

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Rejection does not take effect until communicated to offeror

Postal rule does not apply

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Offeror may revoke any time before acceptance.

Payne v Cave

Routledge v Grant

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An option contract will be invalid for want of consideration

Routledge v Grant

contract Dickinson v Dodds - valid

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Revocation with a valid option contract will be a breach

Dickinson v Dodds

Communication of revocation is essential, it is only effective upon actual notice reaching the offeror

Byrne v Van Tienhoven

Revocation can be communicated by a third party (without authorisation) provided the offeror has shown, by words or conduct, clear intention to revoke his offer

Dickinson v Dodds BUT Treitel criticism - uncertainty CA decision so will be followed, but may be overruled if it reaches Supreme Court - look at both outcomes

It is possible to revoke a unilateral offer any time before completion of the required act

Great Northern Railway v Witham

Where offeree has partly performed obligation and is willing and able to complete the specified act required for acceptance of the unilateral offer, the offer may not be revoked

Errington v Errington & Woods

Offeror of a unilateral offer must no prevent condition becoming satisfied

Daulia v Four Mill

Offeror of a unilateral offer must take reasonable steps to bring revocation to the attention to all who may have read the offer - same notoriety must be given

Shuey v US

Lapse of offer by time

Ramsgate Victoria Hotel v Montefiore

If offeree aware the offeror has died, offer lapses. If unaware, it may remain open

Bradbury v Morgan

If offeree dies, the offer lapses and cannot be accepted by executors

Re Duff's Executors' Case

Lapse by non-fulfillment of a condition

Financings Ltd v Stimson

Acceptance must be unqualified - mirror image

Hyde v Wrench

Acceptance must be made in response to the offer - only the offeree can accept

Boulton v Jones

An offer is not accepted by doing the required act in ignorance of the offer

R v Clarke

If the offeree has requisite knowledge of the offer, it is irrelevant if they perform the specified act for other motives

Williams v Cawardine

Colleagues were deemed to be his agents so that he had requisite knowledge when information was given to the superintendent

Gibbons v Procter

Where the award is for information, only the first person to provide information is entitled to the award

Lancaster v Walsh

Acceptance must be communicated to the offeror. Silence is not sufficient.

Felthouse v Bindley

Offeror cannot state that he will be bound by silence

Felthouse v Bindley

Acceptance may be inferred by conduct

Taylor v Allen, applied in Intense Investments v Development Ventures

3rd party communication of acceptance is sufficient, provided communication is made with the authority of the offeree

Powell v Lee

Where communication is not received due to offeror's fault (e.g. no ink in fax machine), he will be estopped from saying that he did not receive acceptance

Entores v Miles Far East Corporation

Postal rule: where post is the proper mode of communication, acceptance takes effect when the letter is properly posted

Adams v Lindsell

Properly posted = put in hands of PO employee authorised to receive post or in post box

Re London and Northern Bank ex p Jones

Postal rule does not apply to revocations

Byrne v Van Tienhoven

Postal rule applies even where letter is lost of destroyed

Household Fire and Carriage Insurance v Grant

It must be reasonable for post to have been used for postal rule to apply

Henthorn v Fraser | Quenerduaine v Cole

Postal rule will not apply if the offeree misaddresses the letter due to lack of care

Getreide Import v Contimar

The offeror can oust the postal rule by explicitly stating that he will only be bound when acceptance reaches him

Household Fire and Carriage Insurance v Grant | Holwell Securities v Hughes "by notice to me"

Scottish authority saying the posted acceptance can be revoked

Dunmore v Alexander

Scottish authority overruling Dunmore v Alexander - revocation of posted acceptance not possible

Thompson v James

Where communication is made by instantaneous communication, actual communication is required. Postal rule does not apply.

Entores v Miles Far East - confirmed in Brinkibon v Stahag Stahl Onus is on offeree to re-establish connection if he should realise that acceptance was not made. If acceptor reasonably believes his acceptance has been communicated, but this is not so because of the fault of the offeror, the offeror will be estopped from saying that he did not receive the acceptance

Telex sent during ordinary office hours but not seen until the next week was effective when receive as acceptor could reasonably assume communication

The Brimnes

Telex sent out of office hours will be deemed received at the start of the business of the next working day

Mondial Shipping v Astarte

Email sent at 6pm deemed in office hours as previous correspondence showed that the transaction could've been completed that evening

Thomas v BPE Solicitors

Offeror may insist that he will only be bound if acceptance is communicated in a specific way. Offeror can waive this if communication is made in another way

Manchester Diocesan Council for Education v Commercial and General Investments. Onus is on offeror to make it clear if he only intends to be bound by one method

Where offeror prescribes a mode but does not insist that only that mode will be binding, any equally advantageous modes will be binding

Tinn v Hoffmann

If mode is prescribed for the benefit of the offeree, the offeree can waive the stipulation and use an alternative mode, provided it does not disadvantage the offeror

Yates Building v Pulleyn

Commercial agreements - presumption that it is intended to be binding

Well Barn Farming Ltd v Backhouse

Burden of rebutting commercial presumption falls on party claiming no intention and it is a heavy burden to discharge

Bunn and Bunn v Rees and Parker Did not matter that some of the finer details were yet to be worked out; terms were typical of commercial agreement and they were experienced businessmen

Parties can rebut the commercial presumption by stating that the term is "binding in honour only" / "not legal or subject to legal jurisdiction"

Rose & Frank v Crompton Bros

Language used to denote lack of intention must be clear

Edwards v Skyways

Objective assessment of evidence may be enough to rebut commercial presumption - parties wanted flexible relationship

Baird Textiles v M&S

Contractual intention may be negatived if statement made in anger or jest

Licences Insurance v Lawson

Offer of free coin had intention due to business context and commercial advantage of attracting extra customers

Esso v Customs & Excise

"subject to contract" creates strong inference that parties do not intend to be bound

Eccles v Bryant & Pollock

Presumption that family arrangements are not intended to be binding

Balfour v Balfour

Family presumption rebutted as marriage had ended

Merritt v Merritt

Defendant, granddaughter and lodger regularly entered competitions together under one name - sufficient mutuality to show intention

Simpkin v Pays

Bingo winners promised to share winnings - had also complied. Previous conduct showed intention

Peck v Lateau

Minors are not bound by contracts unless for necessaries, made for their benefit, for which they must pay a reasonable price for.

Nash v Inman

A minor is only bound by a contract of employment if for their benefit

Aylesbury FC v Watford FC Proform Sports Management

If Mental Capacity Act doesn't cover incapacity, the contract is binding unless the person claiming incapacity can establish that he did not understand what he was doing, and the other party knew this to be the case

Imperial Loan v Stone

If a person is so drunk he doesn't understand what he is doing, he will have to pay a reasonable price for necessaries but not bound by any other contract

Gore v Gibson

Definition of consideration

Pollock, adopted in Dunlop v Selfridge "an act or forebearance of one party, or the promise thereof, is the price for which the promise of the other is bought, and the promise thus given for value is enforceable."

Executory consideration

promise to perform something

Executed consideration

at the time of the formation of the contract, the consideration has already been performed - unilateral contracts - required act = acceptance and consideration

Consideration must not be past

Eastwood v Kenyon

Where past consideration was provided at promisor's request and it was understood that payment would be made

Lampleigh v Braitwait

Understanding that payment will be made can be implied

Re Casey's Patents

Requirements for past consideration exception:

Pao On v Lau Yiu Long - done at promisor's request - understanding that payment would be made - payment would be legally enforceable if promised in advance

Consideration must move from the promisee

Tweddle v Atkinson

Consideration need not be adequate

Chappell v Nestle

Consideration must be sufficient

White v Bluett

Existing obligations under a contract - promise to do more unenforceable if no new consideration (e.g. extra work)

Stilk v Myrick

Existing obligations under a contract - promise to do more enforceable if contractual duty is exceeded

Hartley v Ponsonby

Promise to pay more may be enforceable even where contractual obligations are not exceeded under certain conditions

William v Roffey Bros: - existing contract - promise to pay more - reason to doubt performing party is willing or able to perform - paying party receives extra benefit/obviation of disbenefit - extra benefit is capable of being consideration

Willam v Roffey Bros does not apply to promises to accept less than is owed

Re Selectmove

Merely carrying out a public duty will not amount to sufficient consideration

Collins v Godfrey

Policeman went beyond public duty by providing information to private individual = consideration

England v Davidson

Performance of a pre-existing obligation to a 3rd party will amount to sufficient consideration for a promise given by the promisor

Scotson v Pegg, applied by The Eurymedon