Contract Flashcards
Why is English contract law relevant in engineering
Basis for much of the world’s global business
English legal system can be broken into 2 parts . . .
Common law jurisdiction:
- statute/legislation
- ‘Judge made law’
Does Contract regard criminal or civil law
Civil law
Describe criminal law
- Rules are set out by society for all our benefit
- Legal action brought by the state
- Any fines imposed in relation to an infringement are paid to the state
Describe civil law
- Legal action is brought by the individual who feels that they have suffered
- Action is brought against the party perceived as having done them wrong
- Any sum of damages identified goes to the party bringing the action
Does Contract regard private or public law
Private
Describe private law
Law between two or more individuals
Can include public sector organisations
Describe public law
Concerns public sector in undertaking its public functions
What is the importance of privity
Generally, only the parties to the contract can enforce it in court
This reflects personal interest in the contract
Contract law is generally …
rule based
What is common law
The strength of an authority will depend upon it having like facts to the case in hand and generally that it was decided in a higher court
Why enter into a contract
- Facilitate exchange
- Plan commercial relationship
- Provide certainty
What form does a contract need to be in
Can be oral or written, except in contracts for land
What is the normal method of enforcement
Award of damages (court calculates sum of money which will put the ‘wronged’ party in the position that they would have been if the contract had been successfully completed)
Essential components of a valid contract
- Offer
- Acceptance
- Consideration
- Intention to create legal relations
- Certainty
What is an offer
An unequivocal indication of a willingness to be legally bound by a promise
Can be to an individual or group
What is not an offer
- Price lists
- Advertisements (generally)
- Window/shop displays
What is acceptance
- a final unqualified expression of assent
- any attempt to vary terms (counter-offer which not acceptance)
- A counter offer kills the original offer
What is consideration
some right, interest, profit or benefit accruing to the one party, or some forbearance, loss undertaken by the other
What is not a consideration
Performance of an existing public duty or contractual duty
What contracts are exempt from consideration
Speciality contracts by deed
What is intention to create legal relations
Assessed objectively in court if parties come into dispute
What is Certainty
Terms have to be certain. Less certain facts/law, the more likelihood of dispute. Not everything has to be in writing but the higher significance the more sense there is in putting it in writing. Court may be able to imply terms.
What is in a contract
Express terms - contained in the offer
Court may imply terms into a contract
When will the court imply a term
- common practice in the geographical area or industry
- In light of consistent and repeated previous dealings
What are exclusion & limitation clauses
- include terms excluding them from liability
What are the restrictions on Exclusion & Limitation clauses
Unfair contract terms act 1977 -
Where the act applies any attempt to exclude liability for death or personal injury resulting from negligence
How can a contract be discharged
- performance of contract
- by agreement of contractual parties
- breach of contract
- frustration of contract
- contract is voidable due to conduct of a contracting party
Can wronged party choose to terminate contract
Breach of condition - Yes
Breach of warranty - No
