consensus in idem Flashcards
When is a contract formed?
A contract is formed when the parties have reached agreement on the essential terms.
What is the term used to describe the necessary agreement between parties in contract formation?
It is called consensus in idem.
What does “consensus in idem” mean?
It means a meeting of minds, where both parties have the same thing in mind regarding the key terms of the contract.
How is agreement assessed in contract law?
Agreement is assessed objectively, meaning a reasonable person would consider whether the parties agreed on the essentials of the contract based on their actions.
What does Lord Dunedin say about how commercial contracts are formed?
Lord Dunedin states that commercial contracts are not formed by what people think privately but by what they say or do.
What happened in the case Mathieson Gee Ltd. v Quigley (1952)?
In Mathieson Gee Ltd. v Quigley, one party offered to supply equipment to remove silt, and the other party accepted. However, the terms differed, leading to no contract being formed.
What did Lord Normand conclude about the contract in Mathieson Gee Ltd. v Quigley?
Lord Normand concluded that no contract existed because the offer and acceptance referred to different types of contracts, meaning there was no mutual agreement.
Do parties need to agree on every term of a contract for it to be valid?
No, parties do not need to agree on every term. They must, however, agree on all of the essential (or material) terms.
What are essential terms in a contract?
Essential terms depend on the nature of the contract. For example, in a sale contract, essential terms include identifying the goods or land and agreeing on the price.
Does the price need to always be agreed in a sale contract?
No, the price does not always need to be agreed. Under section 8 of the Sale of Goods Act 1979, the court can set a reasonable price if the contract does not specify one.
How should the subject matter of a sale be identified?
The identification of the subject matter depends on the type of item being sold:
Fungible items (like barrels of sugar) may be identified by class.
Heritable property (land or buildings) requires detailed identification.
What are the essential terms of a lease contract?
For a lease, essential terms typically include:
- Property to be leased,
- Rent to be paid,
- Duration of the lease. Additional terms, like a rent review clause or purchase option, may also be essential.
Why was there no binding contract in Bogie v The Forestry Commission?
There was no binding contract because the parties had not agreed on the precise boundaries of the property, and there was no machinery for determining them without needing further agreement.
What did Lord Macfadyen say is essential in an option to purchase heritable property?
Lord Macfadyen said that the identity of the subjects (property) is an essential element in an option to purchase heritable property.
What legal principle prevented a contract from being formed in Bogie v The Forestry Commission?
The absence of sufficient consensus in idem (no full meeting of minds on essential terms) prevented the formation of a binding contract.
Are courts willing to uphold contracts even if some terms are incomplete?
Yes, courts are generally keen to uphold contracts and are reluctant to strike them down just because they are incomplete.
What did Lord Macfadyen say about interpreting incomplete agreements in Bogie v The Forestry Commission?
Lord Macfadyen said that courts should prefer a construction that treats the parties’ discussions as effective to constitute a binding contract if such a construction is available.
Which case did Lord Macfadyen cite to support the idea of favouring contract validity?
Lord Macfadyen cited R&J Dempster Ltd v Motherwell Bridge and Engineering Ltd (1964).
How does Avintair v Ryder Airlines 1994 relate to incomplete contracts?
Avintair v Ryder Airlines shows that the court may recognize a contract even where some terms have not been fully agreed, focusing on the intent and conduct of the parties.
What principle was explained in RTS Flexible Systems Ltd v Molkerei Alois Muller GmbH (2010) regarding incomplete terms?
The principle is that even if terms of economic or other significance have not been finalised, the objective appraisal of the parties’ words and conduct may show that they intended to be bound by a contract.
