Class7: Law of Contract

Question 1

What is a contract?

Answer 1

This is a legally binding agreement between two or more parties

Question 2

A contract may be . . . .

Answer 2

Oral, Written or Implied

Question 3

Give the 2 types of contracts

Answer 3

Simple and Contract under seal

Question 4

What is a contract under seal?

Answer 4

This type of contract is written, signed and sealed by all parties involved

Question 5

What is a simple contract?

Answer 5

This is an informal type of contract made verbally or through mere conduct of the parties involved

Question 6

List the 5 elements of a contract

Answer 6

Offer, Acceptance, Consideration, Intention to create legal relations and Legal capacity of parties

Question 7

What is an Offer?

Answer 7

It is an expression made by a party towards another under specified terms

Question 8

What are the 2 parties involved in the process of a flour?

Answer 8

Offeror and Offeree

Question 9

What are some of the rules of the governing offer in contract laws

Answer 9

Be communicated to the offeree
Be definite and certain

Question 10

What is an invitation to treat?

Answer 10

This is merely the willingness to negotiate, it is an invitation to offer

Question 11

What are some of the ways in which an offer can be terminated in a contract

Answer 11

Rejection, Lapse of time, Death of parties, Insanity of parties, Counter offer, Revocation/Withdrawal.

Question 12

What is acceptance?

Answer 12

A reply made to when an offer is made

Question 13

what are some Conditions guiding acceptance

Answer 13

It must be unconditional
It must be a mirror image of the offer in contract
The offeree communicates with the offeror

Question 14

What is an extra rule in acceptance?

Answer 14

Silence is not acceptance

Question 15

What is the postal rule?

Answer 15

This means that an offer made by post is effective as soon as it is posted

Question 16

Define Consideration?

Answer 16

This is when in order for a contract to be valid both parties should have contributed something of value

Question 17

List some rules governing Consideration?

Answer 17

It must not be illegal
It must be made from offeror to offeree
It must be sufficient
It may be executed but must not be past

Question 18

What is Intentions to create legal relations?

Answer 18

An offer must be made and accepted with the intention that their agreement is of legal consequence

Question 19

Court guidelines used to determine the intentions to create legal relations are:

Answer 19

Parties to domestic and social agreements do not intend to be legally bound.
Parties to business agreements intend to be legally bound

Question 20

What is Legal capacity to parties?

Answer 20

This means that it is taken under surveillance if the offeror or offeree is legally allowed to participate in contractual relationships

Question 21

Mention the rules governing legal capacity to participate

Answer 21

Minors
Illiterates
Mentally disordered persons
Drunken persons

Question 22

Define privity of contract

Answer 22

This means anyone who s not a party in a contract cannot enforce it

Question 23

There are some exceptions to the privity of contract which are

Answer 23

Agency
Third party insurance
Assignment of her contractual rights

Question 24

What is discharge of contract?

Answer 24

This is the termination of a contractual agreement and relation

Question 25

Mention the methods of discharging contract

Answer 25

By performance
By impossibility of performance
By consent
By lapse of time
By operational contract
By breach of contract

Question 26

Ways in which discharge of account may occur under consent

Answer 26

Novation
Alteration
Remission
Rescission
Waiver

Question 27

What are some examples of defects in contracts

Answer 27

Misinterpretation
Mistake
Duress
Undue influence