general - c2

Question 1

can a party recover goods from a third party where the contract turns out to be invalid but is:
void
voidable

Answer 1

void - yes - there is no contract and the goods should be returned
voidable - no - the contract can be set aside by the injured party

Question 2

lack of capacity - void or voidable

Answer 2

voidable

Question 3

absence of free will - void or voidable

Answer 3

voidable

Question 4

illegality - void or voidable

Answer 4

void - contracts cannot be illegal or against public policy, therefore there is no contract and goods should be returned

Question 5

misrepresentation - void or voidable

Answer 5

voidable - incorrect statement of fact made pre contract which is intended to and does cause the party to enter into the contract

Question 6

in which cases must an agreement be in writing to be enforceable

Answer 6

transfer of land
consumer credit agreements

Question 7

in which cases must an agreement be evidenced in writing to be enforceable

Answer 7

guarantees

evidenced = written record of the agreement - ie meeting board min

note - guarantor must sign

Question 8

can oral contracts exist?

Answer 8

yes they are enforceable - except the exceptions!

written agreement - land transfers, credit consumer agreements
written evidence of agreement - guarantees (guarantor must sign)

Question 9

examples of invitations to treat

Answer 9

ITT = not an offer - statement of a willingness to enter into negotiations - cannot accept an ITT - invites other parties to make an offer

newspaper advertisement, items on shop shelf, circulation of a price list, auction, market stall (exhibiting goods for sale - ITT not offer)

Question 10

how can an offer be terminated?

Answer 10

rejection - offeree rejects the offer made by the offeror

counter-offer - the offeree proposes new or amended terms which results in termination of the original offer

lapse of time - can be expressed in the offer or after a reasonable amount of time

revocation by the offeror (withdrawal of offer) - can be made by any RELIABLE person + must be RECEIVED by the offeree

failure of a pre-condition - an offer will automatically lapses if a pre-condition is not satisifed
ie. I will sell my textbooks if I pass my exam first time

Question 11

revocation - does the postal rule apply? must the revocation be made expressly in precisely the same manner as the original offer in order to be effective? does it need to be express? what are the two Rs?

Answer 11

no - postal rule applies only to acceptance, not revocation

no - a revocation need not to be made expressly but may be implied

Revocation = Reliable + Received by the person

Question 12

can acceptance ever be implied through silence?

Answer 12

no! some act is required (express words or conduct). silence is not enough!

-acceptance can be inferred by conduct
-acceptance may be made by the offeree or his authorised agent

Question 13

postal rule - rule, conditions, exceptions

Answer 13

rule - acceptance by post is valid from the moment the letter of acceptance is posed regardless of whether it is actually received

• must be reasonable form of contemplation between parties
• letter must be correctly addresses + correct postage paid
• applies to acceptance, not revocation
• “acceptance by writing” overrides the postal rule as notice must be received by the offeror
• does not apply to instant communication such as emailing

Question 14

acceptance - communication or conduct?

Answer 14

both! some act is required ie communication or conduct

think: carlill vs carbolic smoke co

Question 15

what means of communication is allowed for acceptance?

Answer 15

any UNLESS there is a prescribed acceptance in the offer made by the offeror (or in a way which is not less expeditious)

Question 16

presumption re social domestic family arrangements

Answer 16

rebuttable - arrangements are not intended to be legally binding

ie rebut = husband and wife who are separated

Question 17

presumption re commercial agreements

Answer 17

intended to be legally binding (hard to rebut) BUT it is rebuttable

Question 18

consideration: adequate + sufficient

Answer 18

not necessarily adequate ie MV

has to be sufficient = must have some identifiable value

Question 19

Scenarios for a waiver of rights:

Answer 19

Agrees to except something else of identifiable value/alternative consideration

Agrees to pay early/early payment

Third party payment - 3rd party settles the liability and pays less than the original debt

Bargain between creditors - all creditors agree the reduced value

Question 20

contracts - type of terms

Answer 20

express = stated

implied

Question 21

implied terms - define + scenarios

Answer 21

additional terms in a contract my be implied by law - they are deemed to form part of the contract even though they are not expressly mentioned

• by reference to custom (within an industry) UNLESS custom is inconsistent with the express terms of the contract
• by statue (law) which can overrise express terms of a contract
• by the courts (to make the contract understandable)

Question 22

define - privity of contract

Answer 22

only a person who is a party to a contract has enforceable rights under the contract and can be bound by a contract

Question 23

exceptions to the privity rule

Answer 23

• road traffic act
• agency arrangements
• executors in a will = executor stands in the shoes of the deceased person thereby becoming party to the contract
• the contracts act = a third party may enforce a term of the contract provided the contract expressly provides that he/she can (by clearly identifying them) + the term confers a benefit over them

Question 24

what contracts are required to be made by deed?

Answer 24

conveyancing = transfer of property
lease > 3 years
regular payment of a donation to charity

Question 25

difference between deed vs contract

Answer 25

deed = must be written
contract = written or oral

deed = consideration is not required (exception to the rule)
contract = consideration is required

Question 26

which forms of consideration are valid - executed, executory, past

Answer 26

executed = valid - an act performed or executed in return for a promise - payment occurs at the time the contract is made

executory = valid - a promise given for a promise - future

past = an act which has already been done when the promise/contract is made - not valid consideration