Rules and Theory of Contract Law Flashcards
1
Q
Agreement
A
- Making an agreement to do something, such as buying a car.
2
Q
Validity of Agreement
A
- Is there any misrepresentation (vitiating factors)?
3
Q
Terms of Contract
A
- Terms and obligations on both sides, some which are specifically stated, others of which are implied.
4
Q
Discharge of Contract
A
- Examining breaches of contract, non-performance or part-performance.
- Are there events outside of control of parties?
5
Q
Remedies
A
- Where the contract has been breached or been affected by a vitiating factor.
6
Q
Contract Law
- Statute?
A
- Derived from common law. Equity/fairness/morality always considered.
- Some provision plugs gaps, Sale of Goods Act 1979, Consumer Rights Act 2015.
7
Q
Freedom of Contract
A
- We are free to make any contract we want, even if it is disadvantageous.
- Based on the sanctity of a promise to be enforced by law.
- Some statutory protection.
8
Q
Reliance Theory
A
- Not a promise but an assumption of responsibility for a specified performance.
9
Q
FoC v Reliance. Who wins?
A
- Agreed terms must be certain.
If contract too vague, not valid contract (Guthing)
10
Q
Lord Denning Overview on Contract Law
A
- Should be an objective view that as soon as the last forms have been exchanged between parties and no objections raised that the terms are settled and a contract is valid.
11
Q
Implied Terms
A
- Placed in contracts that may have not been agreed.
- CRA 2015, Parliament stated that terms, rights and remedies cannot be excluded by a business.
12
Q
People for FreeOCont
A
- If you don’t like the terms, you don’t have to enter the contract.
- Others will say you have no choice.
13
Q
Good Faith
A
- Expectations are that both parties will do what they’ve said they will do.
- Criminal Sanctions for worst breaches, fraud.
14
Q
Victoria Laundry v Newman (Good Faith)
A
- Responsibility for any losses taken by the person at fault, but only losses that are reasonably within the contemplation of the parties may be recovered.
15
Q
Wellesley Partners LLP v Withers LLP
A
- Basic rules of contract, 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.
16
Q
Problems with Good Faith
A
- 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 interests of the parties to a contract by legislation, interpretation of common law, some equity.
- Result, lack of certainty.
17
Q
United Nations Convention on Contracts for International Sale of Goods
A
- There should be good faith in int’l commercial contracts, yet most int’l trade contracts state English Law will apply in London.
18
Q
Balance Interests and Justice
A
- Exclusion clauses, buyer beware, caveat emptor have brought mixed results.
- Olley, Thompson
19
Q
Who can take legal action in a contract?
A
- Only a party to the contract may do this. An agent, or someone acting on behalf of a third party in making a contract means the contract is between the third party and the principal. (other party)
20
Q
Jackson v Horizon Holidays
A
- Claimant was successful in seeking damages for himself and his family even though only he had signed the contract.
21
Q
Contract (Rights of Third Parties) Act 1999
A
- Allowed third parties to make claims where the contract made this clear, but since most contracts exclude these, largely not applicable.
22
Q
Law Reform (Frustrated Contracts) Act 1943
A
- Courts may order for a ‘just sum’ to be paid to balance interests and justice.
23
Q
Principle of Fault (MisRep)
A
- Responsibility in one theory in ContL. An untrue statement of a fact is a misrepresentation and a vitiating factor, therefore remedies will be appropriate.
- Degree of seriousness of misrepresentation: innocent, negligent or fraudulent.
24
Q
Obligation to Tell
A
- If one party doesn’t ask about something, there’s no obligation to tell, so silence isn’t misrepresentation, this is because there is freedom of contract.
- If there is deliberate to conceal a fact, then there’s liability.
25
Level of Blameworthiness (Principle of Fault)
- Determines whether a person can end the contract or must continue it, but claim some compensation.
26
Law Commission Report 1995
- Recommended no punitive (excessive) damages for breach of contract, although penalty clauses in some contracts suggest otherwise, subject to judicial review.
27
ParkingEye v Beavis
- Lord Sumption, upholding a parking penalty of £85, stated that whilst the penalty rule was an interference with FreeOfCont; in a negotiated contract, parties themselves are the best judges of what is appropriate. Means as long as penalties are not excessive, they are legal.
28
Morality in Contract
- Pearce v Brookes, contract between a cab owner and a prostitute in order for her to purse her trade was void for moral purposes.
29
Parkinson v College of Ambulance (Morality)
- Purpose of which was to buy a knighthood (immoral).
30
Dann v Curzon (Morality)
- Contract to commit a tort or a crime (immoral)
31
Napier v National Business Agency
- A contract that set out to defraud (immoral)
32
Tax Contracts
- Tax Avoidance (Legal), Tax Evasion (Illegal), are contracts that set out to help people avoid tax immoral?
33
Estoppel
- Means if one party to a contract and the other party relies on that promise, then they cannot go back on the agreement as they are 'estopped' from breaking a promise.
34
Central London Property Trust v High Trees
- Rent would be returned to the originally agreed price for future only. CLP couldn't claim back the money during the war years.
- Lord Denning established promissory estoppel.
- This prevented CLP going back on their promise to accept a lower rent despite the fact that the promise was unsupported by consideration.
35
Derry v Peek
- Tort of Deceit. It would be wrong to allow a contract to be obtained by fraud,
- Pay day loans rates? Are these moral? They are legal.
- In relation to contract law, morality is present with illegal contracts, economic duress, terms imposed in contracts and equitable.
