CIPS L4M3 Chapter 1 (1.2) Flashcards
What are the five (5) condidtions for a contract to exist?
- Offer
- Acceptance
- Consideration
- Intention
- Capacity
What is an Offer?
It is a full statement of what the offeror is willing to provide and the terms by which they are willing to provide it.
Who is an Offeror?
A person making an offer
Who is a Plaintiff?
The person bringing a legal claim
What are four actions that are NOT offers?
- Invitation to treat
- Declaration of intention
- A ‘mere puff’ (or boast)
- Provision of information
What are the six (6) ways in which an offer will end (ie cease to be capable of being accepted)
- Withdrawal
- Lapse
- Death
- Rejection
- Failure of conditionalty
- Acceptance
What is Specific performance?
this is where a court orders a party in breach of the contract to perform exactly what is required to be done under the contract. Specific performance might be ordered in addition to damages. The remedy exists so that parties to a contract cannot simply get out of their obligations by accepting the financial cost of damages.
Who is a Defendant?
The person defending a claim brought against them
What are Express Terms?
Contractual terms which are specifically stated in contract documents
What are Implied Terms?
Contractual terms that exist but are not written within the contractual documentation, i.e. the law of the land
What are the conditions of Acceptance?
- Can only occur while the offer is open
- It must be absolute and unconditional
- It cannot be made by someone with diminished capacity
What is the meaning of Diminished Capacity?
A person’s inability to enter a contract, e.g. because they are a minor, are suffering from mental health issues, or are under the influence of drugs
What is a Subject to contract?
Heading used on letters, to indicate that matters are still being discussed and that the letter must not be taken as a formal offer or an acceptance of any terms referred to within it (particularly in land transactions)
What is a Letter of intent?
A letter issued by a purchaser indicating that they intend to accept a tender, usually subject to certain preconditions having been met, such as obtaining any legal or financial consents
What is Title of goods?
Legally recognised ownership
What is Acceptance by Performance?
It is an acceptance implied by actions, e.g. if a purchaser uses the goods supplied.
A purchaser/buyer cannot assume title to goods
When the seller is silent about an offer made, even if the buyer has made a payment - particularly if that payment did not require action on the part of the seller.
What are the two (2) rules which override the need for acceptance to be communicated?
- The person making the offer decide they do not require it.
- The mailbox rule, this principle holds that if a letter accepting an offer has been properly posted, then it will be effective from the date of posting, even if it never arrives. There must be evidence of posting.
What is the Vienna Convention?
The United Nations Convention on the International Sale of Goods
What does The Vienna Convention state?
- That the postal rule does not generally apply (as a means of establishing when and where the contract was concluded) but it does retain the part of the rule which says that an offer cannot be withdrawn after an acceptance has been sent, whether or not the acceptance is received.
Consideration
In commercial contracts, consideration can be thought of as what?
- Payment for goods or services being provided.
What is Past consideration?
- Something which has already been done or given cannot act as consideration
What is Implied consideration?
- If the detail of a promise to pay is expressed after the provision of goods or services, but there is an implication that such a promise would be forthcoming, this may be a valid consideration.
What is A promise to perform an existing obligation?
- If the existing obligation is a legal one, it must be performed whether or not the goods or services at issue are delivered, so it cannot be said to be in exchange for them
What is A promise to perform over and above an existing obligation?
This is a consideration e.g. police presence inside football grounds before, during and after matches, which has to be paid for by the football clubs. Conversely any police presence outside the ground is at the discretion of the force and comes under its existing public order duties.