Rules And Theories

Question 1

What is contract law

Answer 1

• largest derived from common law. Equity always considered
• some statutory provision to plug the gaps - the sale of goods act 1979, consumer rights act 2015 ect
• EU law as well, now copied into uk law since Brexit
• freedom of contract theory states that we are free to make any contract we want, even if it is disadvantages. It is based on the sanctity of a promise to be enforced by law. There is some statutory protection
• the reliance theory is not a promise but an assumption of responsibility for a specified performance
• whichever theory, agreed terms must be certain.

Question 2

Good faith

Answer 2

• expectations is that both parties will do what they said they will do
• criminal sanctions for the worst breaches e.g, fraud
• responsiblity for any losses taken by the person at fault, but only losses that are reasonably within the contemplation of parties may be recovered - Victoria laundry v Newman
• Wellesley partners LLP v withers LLP - basic rule of contract, that contracts are made between parties in good faith and that the damage resulting from the breach would have been the type in mind when the contract was made

Question 3

Problems with a good faith

Answer 3

• good faith - businesses are competitive and so parties entering into contracts cannot be expected to disclose every aspect of their business deals
• balance needs to be struck between the intrests of the parties to a contract by legislation, interpretation of common law, some equity
• results - lack of certainty
• the United Nations convention on contracts for the international sale of goods states that there should be good faith in international commercial contracts

Question 4

Balancing intrests and justice

Answer 4

• exclusions clauses, buyer beware, caveat emptor
• only a party to a contract may take legal action. An agent, a person acting on behalf of somebody else, in making a contract with a third party, means the contract is between that third party and the principle
• Jackson v horizon holidays - claimant was successful in seeking damages for himself and his family even though only he had signed the contract
• the contract act 1999 allowed third parties to make claims where the contract made this clear, but since contracts exclude, this is largely not applicable
• courts may order a ‘just sum’ to be paid - law reform act.

Question 5

Balancing intrests and justice

Answer 5

• exclusions clauses, buyer beware, caveat emptor
• only a party to a contract may take legal action. An agent, a person acting on behalf of somebody else, in making a contract with a third party, means the contract is between that third party and the principle
• Jackson v horizon holidays - claimant was successful in seeking damages for himself and his family even though only he had signed the contract
• the contract act 1999 allowed third parties to make claims where the contract made this clear, but since contracts exclude, this is largely not applicable
• courts may order a ‘just sum’ to be paid - law reform act.

Question 6

The principle of fault

Answer 6

• responsibility is one theory in contract law. An untrue statement of fact is a misrepresentation and a vitiating factor, therefore remedies will be appropriate
• degree of seriousness of misrepresnation: innocent, negligent or fraudulent - smith v land and house property
• if one party doesnt ask about something, there’s no obligation to tell, so silence isn’t misrepresentation, this is Because there is freedom of contract
• this different in insurance contracts, where good faith is required
• if there is a deliberate attempt to conceal a fact, then there is a liability

Question 7

Morality

Answer 7

• morality is mostly associated with criminal law, although it comes into contract as well. In Pearce v brooks, a contract between a cab owner and a prosititute in order for her to purse Howe trade was void for moral purposes
• other examples
• dan v curxon case