Definitions

Question 1

What is a Contract?

Answer 1

○ ‘an agreement between two or more people or businesses which the law will enforce’

Question 2

The offeror

Answer 2

Any party can make an offer

Question 3

The offer

Answer 3

The Party to whom the offer

Question 4

the beginning of the creation of a contract?

Answer 4

When the offeree accepts the offer an agreement is formed

Question 5

Types of offer

Answer 5

Traditional

Unilateral

Question 6

Traditional Offer

Answer 6

requires COMMUNICATION of acceptance to form a contract

Question 7

Unilateral Offer

Answer 7

no formal communication is required. The offer is accepted when the offeree carries out the terms of the offer.
○ [e.g. Carlill v Carbolic Smoke Ball case]

Question 8

Promise vs contractual obligation

Answer 8

It did not matter that the ‘acceptance’ was within the 6 week period as there was no legal obligation on the defendant to keep to that arrangement as it was merely a promise not a contractual commitment.
e.g. Routledge v Grant 1828

that if payment is made in order to keep an offer open then that promise is binding

Question 9

invitation to treat

Answer 9

an invitation to others to make offers to you.

e. g. An auctioneer invites customers to make offers by bidding and the auctioneer accepts the offer by hitting a hammer on the table following the highest bid.
- It is important to identify whether one party is making an offer or an invitation to treat as a contract is only formed when an OFFER is ACCEPTED.

Question 10

Tender

Answer 10

a competitive offer to provide goods or services.
- a legal obligation to consider ALL tenders (is not = Breach of contract)

• In some areas of business

• it is common to allocate work by inviting tenders and
• the request for tenders is classified as an invitation to treat as the person inviting tenders is free to choose whichever tender he/she prefers.

Question 11

Acceptance

Answer 11

a contract comes into existence the moment that it is accepted.

From that moment onwards all of the duties, obligations and liabilities of the contract become binding on the parties.

It is therefore vitally important to know exactly when the offer has been accepted

Question 12

‘The Battle of the Forms’.

Answer 12

two contracting parties are each trying to enter into the contract using their own standard terms

Question 13

The Postal Rule

Answer 13

Where an offer is made requiring (expressly or impliedly) that acceptance is by POST then if post is used the acceptance will take place as soon as the letter of acceptance is posted.

Question 14

Mirror Image Rule

Answer 14

the offeree cannot purport to accept an offer while at the same time altering the terms of the offer for by doing so the offeree is effectively making a new offer, known as a counter-offer.

Question 15

Consideration

Answer 15

• The doctrine of consideration is peculiar to English Law and is based upon the view that our law enforces bargains and not mere promises.

the price (although not necessarily a monetary one) which induces a party to enter into a contract. 
		○ Once again, the courts have developed a number of rules to determine whether there is valid consideration in a contract.

Question 16

define EXECUTED CONSIDERATION

Answer 16

Consideration that is exchanged at the time of the agreement

example
○ X AGREES TO SELL HER CAR TO Y FOR £2,000 –
○ THE EXCHANGE TAKES PLACE IMMEDIATELY

Question 17

Define EXECUTORY CONSIDERATION:

Answer 17

a promise to give consideration in the future

Example
○ X AGREES TO SELL HER CAR TO Y FOR £2,000 -
○ THE EXCHANGE IS TO TAKE PLACE NEXT WEEK

Question 18

Define Privity of contract

Answer 18

means that any action for breach of contract must be brought by a party who gave consideration.

• a claimant who brings an action for breach of contract must show that the claimant him/herself made a promise of consideration.

Question 19

Rule in Pinnels Case

Answer 19

□ The rule creates fairness in situations where the creditor is giving in to pressure by the debtor to accept less.

Question 20

Define Promissory Estoppel

Answer 20

It is an equitable principle:

• This means that it is designed to create fairness where a strict application of the common law rules would be unfair
• Equitable principles are discretionary so a court does not have to apply the rule, but may do so if it feels that this would ensure justice

• It is a shield not a sword

• This means that it can only be used to protect a Defendant who is being unfairly sued (i.e. a shield to protect against an unfair claim)
  ○ So it is not available to a Claimant trying to bring a legal action (it is not a sword which could be used for attack)

E.g. Coombe v Coombe

Question 21

Solus Agreements

Answer 21

contracts between supplier and retailer)

Question 22

Injunction

Answer 22

An injunction is a court order imposed on the other party in order to stop him from acting in breach of contract.

Question 23

Special Performance

Answer 23

This is another equitable remedy which could be granted at the discretion of the court.

a court order requiring the party who is in breach of contract to perform the contract as agreed.

• useful in contracts for the sale of land or houses because each piece of land/house is unique

Question 24

Discharge of a contract

Answer 24

A contract is said to be discharged when neither party has any further legal responsibilities to perform

Question 25

Quantum Meruit

Answer 25

◊ If a contract is frustrated, the court may require the parties to pay for any benefits received.

(the price that the work merits)