Contract Law Flashcards
What are the 3 elements required to form a valid contract?
- Offer + Acceptance
- Consideration (Seal/deed)
- Intention to create legal relation
What is the difference for an offer and an invitation to treat?
An offer is intimation of willingness by an offeror to enter into legally binding contract
An invitation to treat is an offer to negotiate/ to receive an offer
What are a few examples of invitation to treat?
- Advertisements
- Auctions
- Display of goods
- Tenders
- Quotation
- Company prospectus
What are the ways an offer can be terminated?
- Revocation
- Lapse of time
- Offer subjected to condition and condition not satisfied
- Death
- Rejection
When a new condition/term has been introduced, does it mean there is acceptance?
No, this just means that there is a counter-offer on the table.
What are the ways acceptance can be communicated?
- Acceptance may be made orally or in writing
- Silence does not mean acceptance
- If offeror implied or expressly states so, there is no need for communication of acceptance
- Acceptance is effectively communicated when received.
What does consideration mean?
A promisee can enforce a promisor’s promise if he has done or agreed to do something in return for that promise
What are some factors consideration need to fulfill?
Consideration:
- Need not be adequate
- Cannot be past
- Must move from the promisee
- Need not move to the promisor
Why does consideration need not be adequate?
Does not matter the value, the cout will not help you get out of a bad bargain.
Why can’t consideration be from the past?
If, after the transaction is completed, one party subsequently promises another something in return when previously nothing in return was expected, consideration would be past.
What is intentions to create legal relations?
Both parties would have envisaged that should something go wrong, they would have wanted to start legal proceedings or involved he assistance of the court
What are the different ways to allow variation in a contract?
- Fresh consideration
- Seal/deed
- “William Roffey Exception”
- Promissory Estoppel
What is fresh consideration?
If both parties get something in return for agreeing to the change. Both parties get fresh benefit. The change would be legally enforeable
How to allow variation with seal/deed?
Variation made by way of seal or deed, no further requirement and the variation would be legally enforceable
What is the “William Roffey Exception?”
- If A enters into contract with B to do work for
- A has completely performed his obligation under contract
- B has reason to doubt whether A will be able to complete A’s promise
- B promise additional payment for A’s original promise
- A’s results as a results help benefit B or obviates a disbenefit and B’s promise is not given as a result of economic duress or fraud on the part of A
- B’s benefit is capable of being consideration for B’s promise. (Promise is legally blinding)
