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Contract - Paper 3A > Theory Of Contact Law > Flashcards

Theory Of Contact Law Flashcards

1
Q

What is the fundamental basis of contract law?

A

The issue of voluntariness - freedom to contract

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2
Q

Why were consumer pressure groups formed?

A

During the 20th century, prior to CRA 2015, it became unfair on the weaker party in the contract (usually the consumer)

Consumer groups were formed to put pressure on governments to make the formation of contracts fairer on such parties

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3
Q

What was the effect of consumer groups?

A

Courts began to develop contractual rules to protect consumers and Parliament introduces legislation eg The Sales of Goods Act 1979

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4
Q

How has EU law impacted UK law?

A

The consumer rights under EU legislation (provides protection for consumers who are a part of EU membership) has remained valid after Brexit, as most have been incorporated into UK law eg the Unfair Terms in Consumer Contract Regulations 1999

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5
Q

What are the two key types of contract to decide whether there’s intention to create legal relations?

A

Social and domestic (informal)

Commercial or business (formal)

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6
Q

Social and domestic

A

There is a presumption that there is no intention, unless the contrary is proven (rebuttable presumption)

Are not legally enforceable

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7
Q

Commercial or business

A

There is a presumption that there is intention

Are legally enforceable

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8
Q

What is rebuttable presumption?

A

Going against what is presumed

There is an assumption made by a court, which is true unless the contrary is proven

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9
Q

What is a contract ‘under seal’? An example?

A

A legally binding agreement between two or more parties that is enforceable by law

Eg land transfers were made ‘under seal’ by a document called a deed

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10
Q

What is an offer?

A

A proposal made by one party (the offeror) which shows intention to create legal relations

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11
Q

Who is the offeror?

A

The party who makes the offer

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12
Q

Who is the offeree?

A

The party who accepts or does not accept the offer

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13
Q

What is a counter offer?

A

An offer that super-seeds the original offer

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14
Q

What are the two types of offers?

A

Unilateral and bilateral

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15
Q

What is a unilateral offer?

A

An offer that can be made to one/multiple parties, or to the entire world

The offeror promises to do something to/for the offeree, that can only be accepted through the performance of the requested act by the offeree

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16
Q

When do the promise and performance occur in unilateral contracts?

A

Usually at different points

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17
Q

What is an example of an offer in a unilateral contract?

A

Advertisement

The person reading it does not have to make an offer to comply, but simply needs to comply with the advertisement’s terms

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18
Q

What is a bilateral offer?

A

An offer made by one party to another

Where the offeror promises something in return for a promise of something from the offeree

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19
Q

What’s an example of a bilateral offer?

A

The offeror offers a coat for £20, in exchange, the offeree promises to pay the £20 to the offeror

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20
Q

When do the exchange of promises take place in bilateral contracts?

A

At the same time

21
Q

What is an invitation to treat?

A

Not an offer

Inviting/making a proposal for someone to make an offer

22
Q

What is the difference between an offer and an invitation to treat?

A

Unlike an offer, with an invitation to treat, there’s no certainty as to if a contract will be formed

It’s like a negotiation

23
Q

What’s an example of an invitation to treat?

A

Goods on display in shops

24
Q

Why is acceptance important?

A

There is no contract formed until a valid acceptance follows a valid offer

25
Q

What case was the postal rule developed in?

A

Adams v Lindsell

26
Q

What is the postal rule?

A

If the post is an accepted method of acceptance, then the acceptance happens when posting the letter, even if the letter is never received by the offeror

27
Q

What is the postal rule in modern communication methods?

A

With eg text and email, acceptance is usually upon receipt of the offer (when it is received)

28
Q

What is request for further information?

A

A formal request for a party to clarify or provide more detailed information about any matter that is in dispute in the formation of the contract

29
Q

What is an example of a request for further info?

A

Installments

30
Q

What is ‘consideration’?

A

The ‘thing’ of value that is exchanged between two parties under a contract for a promise in return

31
Q

What was Sir Frederick Pollock’s definition of consideration? And in what case?

A

Dunlop v Selfridge

‘An act or forbearance of one party, or the promise thereof, is the price for which the promise of the other is bought, and the promise thus given for value is enforceable’

32
Q

What was consideration born out of?

A

Key Latin term ‘quid pro quo’

33
Q

What is ‘quid pro quo’?

A

Key Latin term defined by Black’s Law Dictionary as “an action or thing that is exchanged for another action or thing of more or less equal value”

34
Q

Who can enforce the promise in a contract?

A

The person who has provided/agreed to provide the consideration

35
Q

Rationale definition

A

An explanation/discussion of the fundamental reasons behind how a decision was made

36
Q

What was created as a result of the absence of contacts under seal?

A

The doctrine of consideration

37
Q

What is the privity of contract rule?

A

Argues that only those who are privy (party) to the contract obtain rights, incur duties, and can sue if they are denied the agreed benefit

38
Q

Give an example of when contracting parties may realize that obligations can’t be fulfilled?

A

Building and construction work

39
Q

What may the offeror do in order to fulfill the contract when there are factors preventing its completion?

A

The offeror may ask for more money/consideration than agreed to complete the contract on time

40
Q

When will the promise to pay extra be binding?

A

Only binding if the party that will be paying the consideration obtains a benefit, and not only just the original fulfillment

41
Q

When will the promise the pay extra be enforceable?

A

Only if the promise was given freely and without economic duress

42
Q

What is economic duress

A

A threat to damage someone’s financial interest

43
Q

What are exclusion/exemption clauses?

A

A term in a contract which excludes or limits the inability of a party in a case of certain contractual breaches that may occur at a later time

44
Q

What is the issue with exclusion clauses?

A

Historically, exclusion clauses (most likely made by the offeror) operate unfairly against the other party, creating an imbalance of power

45
Q

Examples of judicial and statutory control over exemption clauses”

A

Sections 31, 57 and 65 of CRA 2015 prohibit traders from relying on exclusion clauses

46
Q

What does the effectiveness of remedies depend on?

A

The opinion of the injured party

There’s no real way to compensate the injured party unless the contract is carried out as agreed

47
Q

What are the remedies available for breach of contract? What is the effectiveness of these?

A

Common law and equitable remedies

They may provide some/all satisfaction, however, the disappointment and requirement of seeking legal remedies in court must only add to the suffering caused by the breach

48
Q

What has consumers seeking to redress against companies for unfairness led to? An example?

A

Protection for consumers in the form of domestic or EU law

CRA 2015 was introduces to simplify the law in relation to consumers and their rights in the purchase of goods and services

Contract - Paper 3A (4 decks)

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