Contract Law Flashcards
Discharge by frustration
Events occur making it impossible or making the contract fundamentally different. No fault of individual parties
Discharge by frustration reasons (4)
- Destruction of subject matter
- Inability to achieve the main object
- Change in laws/government actions
- Death/permanent illness of a party
Express terms
Terms specifically agreed upon orally or written at the time the contract is made
Condition
- Fundamental term
- A breach gives the innocent party to claim damages
- Gives the right to TERMINATE contract if necessary
Parol evidence rule
If a contract is in written form, no outside evidence makes the terms change
Innominate
Intermediate-term disagreed on. Unclear if it is a warranty or a condition.
Contract classification terms (3)
- Condition
- Warranty
- Innominate
Discharge by performance
Precisely the things both parties wanted and agreed upon have to be completed
Discharge by performance
–> Exceptions (2)
- Substantial performance
2. Divisible contract
Contract
A voluntary agreement made between two or more parties
A term used for contract breach
Contractual liability
Duress
When a party enters a contract due to violence, threats or something in that direction. (economic pressure as well)
Undue influence
Improper pressure put on someone
Contract termination cases (6)
- Void contract
- Voidable contract
- Performance
- Breach
- Agreement
- Frustration
Exclusion clause
–> conditions (3)
Its purpose is to limit or exclude liability for one party when breaching a contract.
- Must cover the exact circumstances
- Can’t defeat the main purpose of the contract
- Judges decide if it is a fundamental breach
Transfer of property
The transfer of OWNERSHIP RIGHTS
Possession would mean having but NOT OWNING something.
When does ownership pass?
As soon as the risk passes. The future owner has to be in possession.
“offer and acceptance”
The party must be aware of it not being an invitation to treat (negotiate)
Conditions to be an OFFER (3)
- Offer must be clearly communicated
- The terms must be certain
- The offer must still be available (not terminated)
Classification of contract terms (6)
- Condition
- Warranty
- Innominate
- Express terms
- Exclusion clauses
- Implied terms
Contract termination
–> Discharge types (4)
- Discharge by performance
- Discharge by agreement
- Discharge by frustration
- Discharge by breach
What is a “Consideration” in a contract?
Something of value (consideration) that will be exchanged for another thing of value (consideration)
Types of consideration (2)
- Bilateral - Exchange of promises
- Unilateral - Act in return of a promise
*Note: mustn’t be of equal value for both
Mistake (Voidable contracts)
–> types (4)
- Non est factum
- Mistaken identity
- Common mistake
- Mutual mistake
Non est factum
A fundamental mistake in the NATURE of the contract
Mistaken identity
One party is mistaken as to the Identity of the other party
Common mistake
Both parties are mistaken about the same thing
Mutual mistake
Parties misunderstood each other; no real agreement
Employment contract types (2)
- Contract for services
2. Contract of service
Contract FOR services
An independent contractor
Contract OF service
A contract between employer and employee
Discharge by agreement
–> scenarios (3)
Both parties agree to end the contract
- Bilateral
- Unilateral
- Automatic
Breach of employment
–> reasons (6)
- Theft/document falsification
- Fighting/bullying/violence
- Harassment
- Vandalism
- Deliberate unauthorized computer use
- Posting derogatory comments about the employer
Breach of contract
When a party failed to perform the agreed terms
*Note: The court is not interested in the motive but rather if you did or not do it
Sale of goods contracts include? (4)
- A contract
- A sale of a good
- A transfer of property (ownership)
- Money consideration (price)
Types of written contracts (4)
- Deed to transfer land
- Hire purchase
- Share transfer/copyright
- Bills of exchange
Warranty
- A minor term in a contract
- A breach gives the right to claim damages
- CANNOT terminate contract
Invitation to tender
An invitation to make people say how much they would charge to supply goods/services
*Note: A response to an invitation to tender is considered an OFFER
Illegality
Contracts for criminal purposes, against morality/public policy
Restraint of trade
Restricts trade is prima facie void unless reasonable between parties and not against public interest
Misrepresentation
–> requirements (3)
Statements made by parties prior to contract
- Statement of fact, not opinion
- Made before or at the time of contract
- Must include the party to enter the contract
Misrepresentation types (3)
- Innocent misrepresentation
- Negligent misrepresentation
- Fraudulent misrepresentation
Remedies to misrepresentation (3)
- In equity
- In tort
- Legislation
Innocent misrepresentation
When someone has reasonable grounds for believing that their false statement was true
Negligent misrepresentation
the defendant is not judged for not having known that the statements made were false. He is judged for not having had reasonable grounds for believing they were true.
Fraudulent misrepresentation
–> conditions (3)
- the party making the statement is aware that it is false or disregards the possibility of it being false
- the party making the statement does so to induce another party to enter into a contract
- the other party enters the contract as a result of the statement and consequently suffers a loss.
