COMMON Q's

Question 1

define a contract

Answer 1

agreement giving rise to obligations which are legally binding and can be enforced / is recognised by law

Question 2

what is a unilateral contract and how is it formed

Answer 2

contract in which only one party is bound. Formed by a unilateral offer, which may be an “offer to the world” (Carlill v Carbolic Smoke Ball Co) or other ‘reward’ cases. It is accepted by performance of the act stipulated by the promisor

Question 3

what is privity of contract and case law

Answer 3

someone who is not a party to the contract cannot enforce rights under the contract or be subject to obligations under the contract, only the parties to the contract can sue or be sued under it (Tweddle v Atkinson / Dunlop v Selfridge)

Question 4

exception to privity and the statute

Answer 4

s1 C(RTP)A 1999 can enforce if the contract expressly provides they may or if the term purports to confer a benefit on them. They must be expressly identified by name, as a member of a class or answering a particular description. Allows a third party to enforce but does not allow a third party to have a contract enforced against them

Question 5

distinguish an invitation to treat from an offer with two case law examples

Answer 5

invitation to treat: invitation for offers or to open negotiations which cannot be accepted (Patridge v Crittenden) and offer: expression of willingness to contract on certain terms which the offeror intends to be bound by upon acceptance (Carlill v Carbolic Smoke Ball Co). Offers can be accepted and give rise to a contract unlike an invitation to treat.

Question 6

what two things may show something in a scenario is an offer

Answer 6

indication of willingness (happy to sell, I am prepared to etc) / certain and detailed terms

Question 7

how can an offer be terminated (4 ways & one case law for one)

Answer 7

rejection (counter-offer), revocation, lapse of specified time or reasonable time (Ramsgate Victoria Hotel v Montefiore), acceptance

Question 8

distinguish a mere request from a counter offer and case laws

Answer 8

Mere request for information does not terminate (Stevenson, Jacques & Co v MacLean) unlike a counter offer which introduces new terms (Hyde v Wrench)

Question 9

what are the three key rules about revocation of an offer and the case law for each?

Answer 9

must be communicated (Byrne v van Tienhoven) must be before acceptance (Payne v Cave) can be via reliable third party (Dickinson v Dodds)

Question 10

what is battle of the forms + case law

Answer 10

when parties respond to each other’s offers with successive counter offers made on their own standard terms and conditions. Each successive communication constitutes a counter offer and terminates the last offer sent. The ‘winner’ is the last party to send a counter offer which is accepted by the other, as the contract is formed on these terms. (Butler Machine Tool v Ex-Cell-O).

Question 11

what is acceptance, give case law for two key rules

Answer 11

final and unqualified assent to all terms of an offer. Must ‘mirror’ the offer. Must be communicated to be effective (Entores v Miles Far East Corporation). Silence is not valid acceptance (Felthouse v Bindley)

Question 12

what is the rule for acceptance via modern mehtods + case law

Answer 12

determined by looking at parties’ intentions, sound business practice and where the risk lies (Brinkibon v Stahag Stahl)

Question 13

what is the postal rule

Answer 13

an exception to the rule that acceptance must be communicated, postal acceptance is valid when sent not received (Adams v Lindsell), depends on if this is acceptable means in circumstances, usually applies to an offer which is posted. Must be properly stamped and addressed.

Question 14

what is consideration, give case law for two definitions

Answer 14

the price of a promise (Dunlop v Selfridge) benefit to promise or detriment to promisor (Currie v Misa). Promises are only enforceable if supported by consideration

Question 15

what is executory consideration

Answer 15

a promise to do something in the future

Question 16

what is the rule in Pinnel’s Case

Answer 16

part payment of debt is not good consideration

Question 17

what are the 5 exceptions to pinnel’s case

Answer 17

	Payment before due date
	Payment with other goods (chattels)
	Settlement of disputed claim amount
	Composition agreement with creditors
	Payment made by third party

Question 18

give the four main rules of consideration and supporting cases

Answer 18

must not be past (Re McArdle) / need not be adequate (Chappell v Nestle) / must be sufficient (Thomas v Thomas) / must move from the promisee (Dunlop v Selfridge)

Question 19

what are the two rules re performance of duties and consideration + cases

Answer 19

existing public duty is not good consideration unless something extra added (Glasbrook Bros v Glamorgan County Council) / existing contractual duty not good (Stilk v Myrick) unless other party will obtain a practical benefit (Williams v Roffey) must be in absence of duress

Question 20

what is the exception to the rule in Re McArdle + case

Answer 20

implied assumpsit, where the act is performed at the request of the promiser, it was understood that payment would be made and the payment would be legally recoverable if promised in advance. (Lampleigh v Braithwaite)

Question 21

what are the rules on intention + cases

Answer 21

social agreements there is no intention (Balfour v Balfour) rebutted by breakdown of relationship (Merritt v Merritt) commercial agreements there is intention (Edmonds v Lawson) rebutted by express intention contract was in honour only (Rose & Frank v Crompton)

Question 22

distinguish conditions from warranties + cases

Answer 22

condition is an important term which goes to the root of a contract, breach gives rise to rescission and damages / warranty is less important as it is collateral to the main purpose of the contract. Breach gives rise to damages but not rescission – compare Poussard v Spiers & Pond with Bettini v Gye

Question 23

what is an innominate term

Answer 23

cannot be classified as either a condition or warranty at the time of formation of the contract. Damages can be claimed for any breach of an innominate term but can only terminate for breach if the breach is sufficiently serious (The Hongkong Fir)

Question 24

how do courts decide if a statement is a representation or term and case law

Answer 24

courts consider importance attached to statement (Bannerman v White), whether it has been put in writing (Birch v Paramount Estates), passage of time between statement and contract (Routledge v McKay), any relevant special knowledge or skills of statement maker (Oscar Chess v Williams)

Question 25

what are express terms

Answer 25

terms distinctly or overtly stated which are agreed by the parties

Question 26

how are terms implied by law + case

Answer 26

as a matter of policy into contracts of a certain type where the nature of the contract implicitly requires it (Liverpool City Council v Irwin)

Question 27

how are terms implied by the court on the facts + cases

Answer 27

must pass business efficacy test (is it necessary for the contract to make business sense) (The Moorcock) or officious bystander test (does it go without saying) (Shirlaw v Southern Foundries)

Question 28

how are terms implied by custom

Answer 28

where there is existence of trade usage, or custom of long duration, certain and reasonable, and not inconsistent with an express term

Question 29

how are terms incorporated into written contracts + cases

Answer 29

signature (L’Estrange v F Gracoub) / actual notice (Olley) or reasonable notice (Parker v South East Railway Co) / by consistent course (Hollier v Rambler Motors) / common understanding (British Crane Hire v Ipswich Plant Hire)

Question 30

how is a contract discharged

Answer 30

performance, agreement, breach or frustration

Question 31

what is entire performance rule + case

Answer 31

party must perform their own obligations precisely and exactly before they are able to demand performance of the other party (Cutter v Powell)

Question 32

exceptions to entire performance + cases for 2

Answer 32

partial / substantial (Hoenig v Isaacs) / prevented (planche v Colburn) / severable obligations

Question 33

what is frustration and its effect on a contract

Answer 33

occurs when without the fault of either party, an event occurs which renders performance of the contract impossible, illegal or undermines it commercial purpose. Must be something which was not anticipated or provided for, or self-induced by one party’s actions. Effect is to end the contract and discharge parties from future performance of it

Question 34

what can frustrate a contract + cases

Answer 34

destruction of subject matter (Taylor v Caldwell) / supervening illegality (Fibrosa v Fairbarn) / government interference / illness or death of party (Condor v The Barron Knights) / non-occurrence of event which was sole purpose

Question 35

what is a misrepresentation

Answer 35

false statement of fact or law which is intended to induce, and which does induce the party it is made to into entering into the contract. Must be statement of fact and not opinion

Question 36

what is fraudulent misrep

Answer 36

knowingly false, without belief in its truth or with reckless carelessness as to its truth (Derry v Peek) Remedies are damages on tort of deceit and rescission

Question 37

what is negligent misrep

Answer 37

falls within s2(1) of Misrepresentation Act 1967, representor cannot establish that they had reasonable grounds to believe the statement to be true and did believe it was true until the time of the contract (e.g. they could have easily found out the truth by checking something). Remedies are damages on tort of deceit and rescission.

Question 38

what is innocent misrep

Answer 38

falls outside of s2(1) MA 1967. Burden of proof on representor to establish reasonable grounds that they believed the statement was true and believed in its truth up to the contract

Question 39

when is silence considered a misrep 5

Answer 39

half truth / statement becomes false pre contract (With v O’Flanagan) / utmost good faith / fiduciary relationship / misleading omission within CPUTR 2008

Question 40

what is rescission

Answer 40

Restores parties back to the positions they were in before the contract was entered into

Question 41

how is remedy of rescission lost

Answer 41

affirmation, lapse of time, if it is impossible, if rights in subject matter have been acquired by a third party

Question 42

what is specific performance

Answer 42

court order requiring a party to perform a contractual duty

Question 43

what is injunction

Answer 43

court order preventing a party from doing something (Araci v Fallon)

Question 44

`what does remoteness mean and give the two tests

Answer 44

if too remote, the loss is not recoverable. If arising naturally from a breach or in reasonable contemplation of the parties at the time of entering into the contract then it will not be considered too remote and the loss is recoverable (Hadley v Baxendale)