Forming of a Contract

Question 1

Where can the definition of a contract be found

Answer 1

Art. II.1:101

Question 2

Where can the definition of when a contract is concluded be found?

Answer 2

Art II.4:101

Question 3

What are the elements of a contract

Answer 3

–> Intention to enter into a binding legal relationship
–> reaching a sufficient agreement
–> Offer + acceptance

Question 4

What are the elements of reaching a sufficient agreement?

Answer 4

–> sufficiently defined terms of the contract
–>etc etc

Question 5

Where can the article on the offer by an offeror be found

Answer 5

-Art II. 4:201

Question 6

Where can the article on acceptance by an offeree be found

Answer 6

Art II.4:204

Question 7

Explain the elements of offer by offeree under the DCFR

Answer 7

-1.
(a)intended to become a contract once theother party accepts it
(b)contains sufficiently definite terms to form a contract

Question 8

Explain acceptance by an offeree under the DCFR

Answer 8

-any form of statement or conduct
-which signals acceptance

Question 9

List the case law on offers and acceptance

Answer 9

-Carlill v. Carholic Smoke Ball Co. (1893)
-Exploding lemonade bottle (1964)

Question 10

Describe the facts of the Carlill v. Carbolic Smoke Ball ad

Answer 10

-Carbolic smoke ball company posts ad promising
-100 pounds to anyone who gets influenza despite using the
-carbolic smoke ball
-Mrs Carlill bought and used the ball but got influenza
-claims 100 pound

Question 11

What was the question of law in the Carlill v. Carbolic Smoke Ball ad?

Answer 11

• Does the ad constitute a legally binding offer?

Question 12

What was the judgment in the Carlill v. Carbolic Smoke Ball Co. case?

Answer 12

-The ad does constitute a legally binding order–> mrs carlill is entitled to 100 pounds

Question 13

Explain the judgment in the Carlill v. Carbolic Smoke Ball Co. case

Answer 13

-Poster mentioned that the money had already been put in a specific bank
–> proving “our sincerity in the matter”

Question 14

Explain the case law rules of the Carlill v. Carbolic Smoke Ball Co. case

Answer 14

-Was it a distinction to enter into a legally binding relationship? OR
-an offer to enter into negotiations
-to negotiate a price

Question 15

Explain the facts of the exploding lemonade bottle case

Answer 15

-Mrs Dehen puts a bottel of lemonade in her basket and goes to checkout where an employee of a supermarket takes items out to count the bill
-Bottle bumps gently against a bottle of beer and explodes
-Mrs Dehen is struck in the eye by the bottle cap or by piece of glass
-Bottle of lemonade had been stored by supermarket in a hot place and was not inherently dangerous

Question 16

What were the main questions of law in the exploding lemonade bottle case?

Answer 16

-Can Mrs Dehen sue the supermarket on the basis of contract or on the basis of tort?
-Whenb is there a contract between customer and supermarket?
-when customer places a product in their basket?
-When customer places a product on conveyer belt of cashier/teller?
-When customer pays?

Question 17

What was the decision of the court in the exploding lemonade bottle case?

Answer 17

-Contract between customer and supermarket starts when customer places a product in their basket

Question 18

Describe the facts of the Hannah Blumenthal case

Answer 18

-Contract with an arbitration clause
-Proceedings started in 1972 but only in 1980 the buyer proposed to fix a date for a hearing
-because delayed arbritatrion, seller uses this to prove contract has been abandoned

Question 19

What was the question of law in the Hannah Blumenthal case

Answer 19

Is the seller right to say that the original contract was abandoned?

Question 20

What was the judgment in the Hannah Blumenthal

Answer 20

Seller could not say that original contract was abandoned

Question 21

Explain the judgment in the Hannah Blumenthal case

Answer 21

Seller could not say that original contract was abandoned
-Normal rules of contract law apply to contracts of abandonment
-should be consensus (meeting of minds/overlapping intentions)
-Intention of a party only counts if the communication of their intention could be reasonably understood by the other party
-Receiver could not have reasonably understood
-As not enough communication and behaviour + not reasonable assumption on seller’s part

Question 22

Explain the facts of the Bank guarantee case

Answer 22

-Bank wrote to Steel Constructors (SC) that it would guarantee the debts of one of SC’s customers
-SC wants to make sure this happens
-Banks says that it had no subjective intention to perform a juristic act

Question 23

What was the judgment of the BGH case?

Answer 23

-SC could rely on statement by Bank
-

Question 24

Explain the judgment of the Bank Guarantee case

Answer 24

–SC could rely on statement by Bank
-declarations of intention not just up to the determination (self-determination) of the offerer but the recipient is also protected as well
-declaration of intention only exists when the declaror, if he had exercised the necessary discretion in social intercourse
-could have realised that his declaration or conduct could have been understood by the recipient as a declaration of intention

Question 25

Explain the facts of the Shared Business trip case

Answer 25

-Mr. S drives Mr. D from France to Italy for a business trip
-They agree to share the cost
-Mr. S causes an accident
-Mr. D sues Mr. S for damages
-Did Mr. S commit a tort or a breach of contract

Question 26

What was the decision in the Shared Business trip case?

Answer 26

-Can not been seen as a contract
-Intention to be legally bound is lacking
-Was not a serious offer and could not have been understood as such

Question 27

What was the main question of the Shared business trip case?

Answer 27

-Was the agreement to share costs a contract?

Question 28

What were the facts of the Betting syndicate case?

Answer 28

-5 people form a betting syndicate; each pays 10
-On one occasion X did not buy a ticket (if he would have done so he would have won 20,550)
-Others sue his ass

Question 29

What was the main question of law in the Betting syndicate case?

Answer 29

• Was there contract which held X liable for the lost profits?

Question 30

What was the judgment in the Betting Syndicate Case

Answer 30

• There was no contract for X to be held liable

Question 31

Explain the judgment in the Betting Syndicate Case

Answer 31

“Contracts leading to onerous circumstances are considered null, even if an agreement has been implied

Question 32

What are the possible outcomes after the offer is made under the DCFR?

Answer 32

• Revoked by the offeror (II-4:202) = offer cancelled, no offer
  -Rejected by the offeree (II-4:203) –> invalid
  -Accepted by the offeree (II-4:205)–> contract concluded
  -Expired (II-4:206)–> offer lapses, invalid
  -Unless II-4:207
  -Modified by the offeree(II-4:208)–> new offer