Chapter 3

Question 1

How do Common-Law principles work?

Answer 1

They are based on tradition/accepted practice over time. Past court cases provide guidance where no formal laws exist.

Question 2

Give an example of a unilateral contract.

Answer 2

A contract where only one party makes a promise, generally a stated performance. eg. the sale of material from a sub to a contractor.

Question 3

What is the difference between an express and an implied contract?

Answer 3

Terms of agreement are clear, concise, explicit and definite in an express contract, whereas in an implied contract terms are not clearly stated, but established through inference and deduction.

Question 4

What elements are required for a contract to be valid?

Answer 4

• Offer and acceptance
• Meeting of the minds
• Consideration
• Lawful subject matter
• Competent parties

Question 5

What is promissory estoppel?

Answer 5

The doctrine that a promise made without the exchange of consideration is binding and enforceable if:

• The defendant made a clear and unambiguous promise.
• The plaintiff acted in reliance on the defendant’s promise.
• The plaintiff’s reliance was reasonable and foreseeable.
• The plaintiff suffered an injury due to its reliance on the defendant’s promise

Question 6

What are some examples of consideration in a contract?

Answer 6

Typically consideration is something of value, ie. a stated sum of money, a product, or an outcome. Both parties must obtain consideration for a contract to be valid.