Contract Law Flashcards
What is a contract?
A legally binding agreement which is enforceable by law.
What are the elements of a contract?
Offer, acceptance, consideration, intention, capacity, consent, legality of form/purpose
Outline an offer.
One person asks the other to enter into a deal with them. All terms must be clearly set out, with no conditions. It can be done by speaking, writing or conduct. The offer can be terminated before the other party accepts. A price tag is not an offer (invitation to treat). E.g. Jim offers Michael €9000 for his car.
Outline acceptance.
The other party must agree to all the terms of the offer, with no conditions. It can be done by speaking, writing, conduct. Once it has been accepted the terms cannot be changed. To accept an offer but change the terms is a counter offer.
Outline consideration.
The payment between the two parties. E.g. Money. It must be real and valuable. It can’t be for free.
Outline intention.
Both parties must mean it to be legally binding and fully understand the consequences if it is broken. Contracts between businesses are always legally binding, but not family.
Outline capacity to contract.
Having the legal right and ability to make a legally binding contract. Exceptions: Under 18 Mentally incapacitated Drunk/drugged/insane Diplomatic immunity Ultra vires
Outline consent.
Both parties must offer voluntary permission. They cannot be under duress or do it against their will. There can’t be lies.
Outline legality of form.
Certain contracts must be drawn up on legal documents/forms or in a certain way to be legal. If they are incorrect, it’s not a legal document. E.g. buying a house.
Outline legality of purpose.
It can only be for legal transactions. If it involves breaking the law it is not a contract. E.g. a drug deal is not legally binding.
What are ways for a contract to be terminated?
Performance: both sides carry out their side of the agreement.
Agreement: a mutual agreement to end it. E.g. quitting job.
Frustration: an unforeseeable event that leaves the contract unable to continue. E.g. death, bankruptcy
Breach: if either side fails to hold up their end of the agreement.
What are remedies for a breach of contract?
Damages: financial compensation. Extra for inconvenience.
Specific performance: the judge can order the party who broke the contract to carry it out.
Rescind: judge returns both of the parties to where they were prior to the breach. (Appropriate for frustration.)
