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W300 Revision > Offer, Acceptance, Contractual Intention and Consideration > Flashcards

Offer, Acceptance, Contractual Intention and Consideration Flashcards

1
Q

Contract - 4 essential elements

A

Offer
Acceptance
Consideration
Contractual Intention

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2
Q

Definition of Offer

A

An expression of willingness to contract on specified terms, made with the intention that it Is to become binding as soon as it is accepted by the person to whom it is addressed - Treitel

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3
Q

Offer - intention / if questioned

A

What would a reasonable person think we’re the party’s intentions. No party’s real intentions, as such, but how a reasonable person would view situation - Smith v. Hughes 1871

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4
Q

Invitation to treat - may be prepared to sell

A

Gibson v Manchester City Council 1979 - council house purchase
Partridge v. Crittenden 1968- advertisement

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5
Q

Shop window goods not an offer

A

Fisher v Bell 1961

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6
Q

Unilateral contract - made to public at large - acceptance through performance

A

Carlill v carbolic smoke ball co 1892

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7
Q

Bilateral contract

A

Exchange of promises between parties

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8
Q

Auctions - statute sale is complete at fall of hammer

Case law

A

Sale of goods act 1979 section 57(2)

Warlow v Harrison 1859 - sale of horse won by low bid

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9
Q

Termination of an offer- 4 ways

A

Revocation - withdrawal anytime before acceptance routledge v grant 1828, must be communicated by offeror and received by offeree - Byrne And Co v. Van Tienhove and Co 1880
Rejection- counter offer destroys offer Hyde v wrench 1840
Lapse of time , time clauses will lapse offer. offer made by telegram implies similar speedy reply quenerduaine v. Cole 1883
Occurrence of conditions, car damaged financings ltd v. Stimson 1962

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10
Q

Revocation may be communicated by third party

A

Dickinson v. Dodds 1876

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11
Q

Partial performance of unilateral contract may prevent revocation

A

Errington v. Errington & Woods 1952

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12
Q

An inquiry made to an offer may not destroy or be counter offer

A

Stevenson Jacques v. McLean 1880

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13
Q

Acceptance

A

Must be communicated

Definition- final and unqualified expression of assent to terms of offer- Treitel / unqualified Hyde v. Wrench

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14
Q

Mode of acceptance

And if not stipulated

A

If stipulated this must be clear or equivalent method would be acceptable - Tinn v. Hoffman & Co 1873
Silence does not constitute acceptance - Felthouse v. Bindley 1862
Can occur by conduct - brogden v metropolitan railway co.1877
Not stipulated OK for offers to public at large

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15
Q

Postal rule - acceptance

A

Posted acceptance complete on posting Adams v Lindsell 1818
Must be properly stamped and addressed London v. Northern bank ex party Jones 1900 or Holwell - must be reasonable to post and rule can be displaced by offeror
Notice to - displaces / Holwell securities ltd v Hughes 1974

If not apply must be made clear

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16
Q

Electronic communication - acceptance

A

Acceptance takes place when communication received - Entorres Ltd v Miles Far East Corp 1955
Or where acceptance could reasonable have been expected to be read brinkbon ltd v stahag stahl 1983

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17
Q

Electronic communication sent in normal hours

A

Deemed accepted or withdrawal of offer effective on receipt

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18
Q

Acceptance issues resolved

A

By looking at the intention of the parties

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19
Q

Consideration

A

A benefit and or detriment - Currie v Misa 1875
Exchange of promises
Price one party pays for the other party’s promise- Dunlop pneumatic tyre co ltd v selfridge and co 1915

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20
Q

If no consideration must be

A

In the form of a deed to be binding - signed and delivered

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21
Q

One sided consideration =

A

A gift

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22
Q

Consideration does not need to be adequate but

A

Must be sufficient

Chappell and co v nestle 1960

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23
Q

General rule past consideration is

To apply it

A

Not consideration - re mcardle 1951- decorating

Done at promissory request - lampleigh v braithwait 1615
Parties understood act was to be rewarded
Payment was legally enforceable

24
Q

Existing duties not consideration

A

Imposed by law - collins v godefroy 1831, testify in court- England v Davidson 1840 paid as reward

Contractually obliged via 3rd party - Scotson v pegg

Contractual duty owed to other party- stilk v myrick 1809 - not pay sailors
But Williams v roffey 1991 - did pay decorators additional benefit distinguished i.e practical benefits

25
Q

Generally part payment of debt

A

Not consideration unless some other payment / early - known as pinnels case 1602 and confirmed in foakes v beer 1884

26
Q

Promissory Estoppel - no consideration

And requirements

A

Equitable doctrine- central London property trust ltd v high trees house ltd 1947 - rent halved during war times
No consideration giving for promise acted upon. Valid
Shield not a sword as defence only
Suspends rather then extinguishes
Must have clean hands
Requirements -
1- pre existing contract or legal obligation modified
2- clear unambiguous promise
3- change of position
4- inequitable to allow promissor to go back on promise

27
Q

Contractual intention - domestic

A

Contractual intentions not assumed
If considerable money ci assumed
Balfour v Balfour 1919 - husband and wife - rebuttable presumption no valid consideration
Merritt v Merritt 1970 - already separated so distinguished from above - consideration valid signed agreement to pay mortgage

28
Q

Contractual intention - commercial

A

Contractual intentions assumed - Edwards v skyways 1964
courts reluctant to overturn presumption esso petroleum ltd v commissioners of customs and excise 1976
To not be binding must expressly agree clearly not - rose & frank ltd v crompton bros 1925

29
Q

Privity in contract

A

General rule no third parties can acquire rights to contract - Dunlop v selfridge 1915
Exceptions - under statute - contracts (rights of third parties) act 1999
Passes benefit not detriment
Third party may enforce term is expressly stated
Must be identified by name or particular class

30
Q

Breach of contract occurs

A

When either express or implied term broken

31
Q

Remedies for breach of contract - 6

A 
Damages
Termination 
Action of an agreed sum
Specific performance
Injunctions
Restitution
32
Q

Classification of damages in contract

A

Unliquidated- damages have to be assessed by courts as not clearly defined
Liquidated - damages agreed in contract set amount

33
Q

Types of damages in contract

A

General - losses can’t be precisely quantified (inconvenience/disappointment)
Special - damages that can be quantified (loss. Earnings profit)
Nominal - breach of contract but minimal loss - small amount usually

34
Q

Assessment of damages in contract

A

Expectation loss basis - usual way Robinson v harman 1848 - damages to put party in position would have been had contract been performed
Ruxley electronics and construction ltd v Forsyth 1996 - swimming pool - loss of amenity new pool would be 22k but court awarded 2.5k
Reliance loss basis- position innocent party would have been in had contract not made

35
Q

Other factors breach of contract

A

Must look to mitigate losses

Remoteness

36
Q

Remoteness in contract

A

Hadley v baxendale 1854 - establish two limbs- mill owner did not have a spare shaft

1) Loss which arises naturally within breach will normally be within parties contemplation
2) unusual losses will only be within parties contemplation if special circumstances known to parties at time contract made

37
Q

Terminate contract

A

Condition is broken or innominate term broken and the effects are major.
If contract performed to a satisfactory standard termination unlikely possible
Termination must be communicated
Affirmation - innocent party must confirm he wants contract to continue and both parties must continue to perform duties.

38
Q

Contract - action of an agreed sum

A

Work done to satisfactory standard
Payment is due but no payment
Contractor can bring action for agreed sum

39
Q

Contract - specific performance

A

Order of the court to compel party to perform contractual obligation
Not available :-
if damages adequate
Where required continuous supervision of court
Employment contracts
Must be equitable

40
Q

Contract - injunctions

And key cases

A

Either prohibitory or mandatory
Warner brothers pictures incorporated v Nelson 1937 - prevent working for another film company - deemed fair as could work just not filming

Page one records v Britton 1968 - manager could be replaced so deemed not fair as would prevent work

41
Q

Contract - restitution

A

Total failure of consideration - money paid but nothing done
Some work would be quantum meriut
No contract but some work done - British steel corp v Cleveland bridge and engineering co led 1984
Surrey county council v bredero homes 1993 - profit as a result of breaking contract - built additional houses only nominal awarded

42
Q

Discharge of a contract - 3 ways

A

By agreement - if all parties agree must be accord and satisfaction = consideration

By performance - doctrine of complete performance / cutter v Powell 1795 died on ship widow not paid

By breach - breach of condition or breach of innominate term if effects major

43
Q

Express terms - contract

A

Specifically Incorporated to contract

44
Q

Implied terms

A

Not specifically incorporated but implied either by case law or statute

45
Q

Implied terms by case law - 4 categories

A

Custom or trade usage - Hutton v warren 1836
Previous course of consistent dealings - spurring v Bradshaw 1956
Presumed intention of the parties - att-gen for Belize v Belize telecom ltd 2009
Implied because of the type of contract - Liverpool city council v Irvin and others 1977

46
Q

Four main acts of Parliament that apply to contracts

A

Sale of goods act 1979
Supply of goods and services act 1982
Consumer rights act 2015
Unfair contract terms act 1977

47
Q

Sale of goods act 1979 - key sections

A

Section 8 - if not stated or ascertainable buyer must pay reasonable price
Section 13 (1) - goods will correspond with the description - implies to sales in course of business or private - strict liability
Section 14 - only applies to sales in the course of business - strict
Section 14(2) goods supplied are of a satisfactory quality
Section 14(2a) meet the standard a reasonable person would regard as satisfactory
Section 14 (3) goods supplied should be reasonable fit for that purpose - if notified to seller
Section 15(a) non consumer buyers lose right to terminate if breach so slight unreasonable to reject

48
Q

Sale of goods act 1979 - remedies

A

Consumer
Reject goods and recover money
Claim damages
6 month limit to reject for non perishable
Also right to repair, replacement or price reduction
Business
Under s13 and 14 right to reject goods lost if slight so unreasonable to reject and depend if condition or warranty

Also both s 35 - right to reject lost if accepted and held for beyond reasonable time

49
Q

Supply of goods and services act 1982 - main sections

I

A

S 3 (2) - goods will correspond with description - all times
Everything else in course you of business
S 4 (2) - goods supplied are of satisfactory quality
S4(5) - goods will be fit for purpose made known
S 13 - supplier will carry out service with reasonable care and skill
S 14 - will carry out service within a reasonable time
S 15 - implies term of reasonable price if not stated

50
Q

Consumer rights act 2015 -key provisions

A 
In relation to goods 
S9 - satisfactory quality
S10 reasonably fit for purpose
S11 to be as described 
S 20 - 22 a short term right to reject
S 23 right to repair or replacement
S 24 right to price reduction or final right to reject
In relation to services 
S49 service to be performed with reasonable care and skill
S50 information is binding 
S51 reasonable price to be paid
S52 within reasonable time 
S56 right to price reduction
51
Q

Classification of terms in contract

A

Condition - major - root of contract party can terminate and clam damages
Warranty - minor - can’t terminate just claim damages
Innominate - either way - objective test would a reasonable person think condition or warranty

52
Q

Cases - Innominate terms

A

Hong Kong fir shipping v Kawasaki kisen kaisha 1962 - 20 week ship repairs on two year contract not substantial s not deprived of all contract

53
Q

Trade usage and commercial expectation

A

If terms common traditionally regarded as a condition

54
Q

Express provision by parties

A

If used in strict legal sense court must give effect to intentions - Lombard north central v butterworth 1987

55
Q

Counter offer - case

A

Hyde v wrench 1840

W300 Revision (11 decks)

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