Formation of Contract I

Question 1

What are the 4 elements of a contract?

Answer 1

1. Offer
2. Acceptance
3. Consideration
4. Intention to Create Legal Relations

Question 2

What is the definition of a contract?

Answer 2

An agreement giving rise to obligations which are enforced and recognised by law

Question 3

What is an offer?

Answer 3

An expression of readiness and willingness made by the offeror to enter into an agreement with the offer, where the offeror intends to be bound to the terms of the contract upon acceptance by the offeree

Question 4

What is the difference between an offer and an invitation to treat?

Answer 4

An offer has the intention for the offeror to be bound to the terms of the agreement
An ITT has no intention to be legally binding, it is only used as an invitation to commence negotiations and make offers

Question 5

What is the parol evidence rule and its exception?

Answer 5

Oral evidence will not be admitted in a court to add, vary, amend or contradict a written contract
Exception: s94 Evidence Act (Sembcorp Marine Ltd v PPL Holdings Pte Ltd)

Question 6

What are some examples of ITT?

Answer 6

1. Price List
2. Advertisements
3. Auctions & Tenders
4. Bids
5. Display of Goods (Chwee Kin Keong v Digilandmall.com Pte Ltd)

Question 7

What constitutes an acceptance?

Answer 7

A final and unconditional assent to the terms of the offer, and it must be communicated to the offeror

Question 8

What are some exceptions to the general receipt rule under acceptance?

Answer 8

1. Offeror waives communication as requirement for acceptance (Carlill v Carbolic Smoke Ball)
2. Both parties agreed on silence being the prescribed mode of acceptance (Felthouse v Bindley)
3. Postal Acceptance Rule (Adams v Lindsell)

Question 9

What is the postal acceptance rule and its conditions?

Answer 9

Acceptance is effective upon posting by the offeree, not when the offeror receives the letter of acceptance
Condition: Both parties agreed on posting as the method of communication, and the letters are properly stamped and addressed

Question 10

Name the three main types of contracts and whether intention to create legal relations exist

Answer 10

1. Social and Domestic Agreements: No intention
2. Commercial Agreements: Intention
3. Administrative Relations: No intention

Question 11

Name four things that render a domestic agreement to be not legally enforceable

Answer 11

1. Honour Clauses
2. Letters of Comfort
3. Letters of Intent
4. Memorandums

Question 12

When can an offer be terminated?

Answer 12

Any time prior to full acceptance

Question 13

What are the ways to terminate an offer?

Answer 13

1. Withdrawal/Revocation
2. Rejection/Counter-Offer
3. Lapse of Time
4. Failure of Condition
5. Death

Question 14

What does s13 ETA entail?

Answer 14

Time of Despatch:
1. When electronic communication leaves the information system under the control of the originator/party who sent it on behalf of the originator
2. When electronic communication is received if it did not leave the information system under the control of the originator/party who sent it on behalf of the originator
Time of Receipt:
1. When electronic communication becomes capable of being retrieved by the addressee at his/her designated address
2. When addressee is aware that the electronic communication is sent to an address not designated by him/her and is capable of retrieving it