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Contract Law 378 > Topic 1: Content & Operation > Flashcards

Topic 1: Content & Operation Flashcards

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1
Q

Two most NB questions?

A
  1. Who must perform and to whom
  2. What must be performed
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2
Q

How can you contract with yourself?

A

In two different capacities only; juristic person.

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3
Q

4 relationships for a contract?

A
  1. Simple joint L&E
  2. Joint & several L&E
  3. Common / Collective joint L&E
  4. Several liability
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4
Q

What is a simple joint relationship?

A
  • Each debtor proportionate share = pro rata
  • One performance, separate obligations
  • Burden not pushed to other if one can’t pay
  • Can’t claim from others if paid
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5
Q

What is joint and several? and Latin?

A
  • singuli in solidum
  • Each debtor responsible for full amount
  • Creditor choose how to claim
  • One pays, extinguished for all
  • Can claim from others
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6
Q

What is common joint L&E?

A

Performance made jointly
Can’t demand from one
- cannot claim half share is made jointly
One obligation
Indivisible performance

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7
Q

What is several liability?

A

Several contracts, multiple parties

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8
Q

What determines a joint relationship?

A

Parties intention
Nature of performance - divisibility

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9
Q

What relationships goes with divisible performance?

A

Simple joint or enough evidence joint and several

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10
Q

What does privity of contract mean?

A

Private between 2 parties and only binds them. 3rd parties can have benefits but not liabilities

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11
Q

What relationships goes with indivisible performance?

A

Common/collective or joint and several. Evidence must be clear

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12
Q

What is representation?

A

A representative or agent performs a juristic act on behalf of somebody else. Agent is a contracting party but not party to the obligations.

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13
Q

What is a mandate?

A

Give another a task to perform. Not enough on its own to be representative, also need authority. Example estate agent.

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14
Q

Remedies against the agent?

A

Delictual claim - has no authority
Contractual claim - has authority

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15
Q

Latin name for an estate agent?

A

Nuntius

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16
Q

Case law about estate agents?

A

Trollip v Jordaan
Allen v Sixteen Stirling

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17
Q

What is the doctrine of the undisclosed principle?

A

Party acting in interest of P but concludes in own name with 3rd P. And hides the fact/does not disclose the fact that acting in interest of other party. Principle can emerge from obscurity and claim performance from 3rd party from contract and enforceable.

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18
Q

Latin name for a contract to the benefit of a third party?

A

Stipulatio alteri

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19
Q

Who are the three persons involved in a contract to the benefit of a third party?

A

Stipulans
Promittens
3rd party

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20
Q

Examples of contracts to the benefit of 3rd parties?

A

Pension
Life insurance policies
Inter vivos trust deeds

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21
Q

There is a debate between academics on third party benefit contracts. What does this entail?

A
  1. Direct right or one contract mode = JC De Wet - creates a right immediately, unstable right. Needs to be accepted first before enforceable
  2. Acceptance model - Prior to the 3rd party accepting the benefit, they have no right.
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22
Q

What is an Adiectus solutionis causa? and provide an example

A

Receive performance on behalf of contracting party, but no right to claim performance. Exp trade union gets membership fees paid.

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23
Q

What is the difference between unilateral and reciprocal obligations?

A

Reciprocal - performance exchanged = 2rights, duties, creditors and debtors

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24
Q

What is a simple obligation?

A

Exact, certain performance. BMW 316 CL2345

25
Q

What is an alternative obligation?

A

Ascertainable as soon as someone exercise choice. Debtor chooses between two or more alternatives.

26
Q

What is a facultative obligation?

A

Performance is specified but debtor can choose to deliver another. Creditor has a claim to the specified performance only.

27
Q

What is a generic obligation?

A

From a class or family or genus of things.

28
Q

Describe the difference between divisible and indivisible performance.

A

Divisible - meaningful discreet aspects, divided into more than one performance - as many obligations.
Indivisible - not subdivided as a whole to be meaningful.
Factors that govern this = nature, parties intention.

29
Q

What is the essentialia of a contract?

A

Characteristics rights and duties which distinguish types of contracts recognised by our common law.
Must agree upon by parties

30
Q

What is the naturalia of a contract?

A

Incorporated into a contract by operation of law - ex lege

31
Q

Why the need for naturalia?

A

Impossible to agree on everything and the law reads these terms into a contract to make it easier for the parties. Ensure sufficient equality. Takes into account public policy, fairness and efficiency

32
Q

What is the incedentalia of a contract?

A

Additional terms provided by the parties and agreed upon. Modify rights and duties implied by law

33
Q

What is an express term in a contract?

A

Written or orally agreed upon by the parties - expressed in words. Direct evidence

34
Q

What is the caveat subscriptor rule

A

Let the signatory beware - if you sign a contract you are bound by it. Even if you did not read and understood the terms.

35
Q

What is a tacit term?

A

Not articulated but intended or deemed intended by the parties.

36
Q

What is the composite test to determine a tacit term? In what case was this decided?

A

Officious bystander test and Business efficacy test. Reigate v Union Manufacturing Co

37
Q

What does the officious bystander test look at?

A

External impartial bystander would ask the parties what they meant when they negotiated the contract and a certain situation now took place.

38
Q

What does the business efficacy test look at?

A

Implication must be necessary and not just convenient and reasonable. Necessary in the business sense to give efficacy to the contract.

39
Q

What is the dual basis for tacit terms?

A
  1. Actual unexpressed intention - self evident so did not include it OR
  2. Imputed intention - parties did not foresee potential situation and thus did not include it
40
Q

What 7 factors is considered when applying the Wilkins NO v Voges test?

A
  1. Only by necessary implication to give business efficacy to make contract function properly.
  2. Inferred from express terms and surrounding circumstances - circumstantial evidence.
  3. Not contrary to express terms
  4. Cannot be read in if detailed and comprehensive
  5. Clear, precise formulation required
  6. Concerns the actual or supposed intention of BOTH parties
  7. Reasonable person standard - objectivity
41
Q

In the Wilkins v Voges test, the tacit terms cannot be contrary to express terms. Explain.

A

Can’t have contradictory terms in a contract and express terms will negate tacit terms. Excepts if there is merger clauses or formalities. Protects tacit terms

42
Q

Define a tacit contract.

A

Inferred from conduct of parties and surrounding circumstances. Example of lease contract expiring and lessee stays on. Clarissa’s example.

43
Q

What are the two tests to prove a tacit contract?

A

Unambiguous conduct - no other reasonable interpretation.
Process of inference - balance of probabilities that it has been concluded

44
Q

What is an implied term?

A

Automatically read into a contract by operation of law - ex lege. Statute or the common law.

45
Q

Distinguish between an implied and tacit term.

A

A tacit term is also implied but a tacit term is based on the parties deemed intention where an implied term is read in by law (ex lege).

46
Q

Distinguish between an implied term and naturalia.

A

Naturalia is also read in as with an implied term, but only for specific contracts for example a sales contract and the delivery of performance and payment of performance.

47
Q

What are the three ways an implied term can be read in by law and explain.

A
  1. Statute - steps in to protect weaker parties exp CPA and labour legislation. Also lease deposit investing.
  2. Custom/ trade usage - practice which develops in a business area over time. reasonable and certain.
  3. Common law - linked to good faith and fairness
48
Q

Define a supposition.

A

Parties conclude contract on the assumption that a certain state of affairs exists. Both parties, otherwise error in motive. Exp agree it is a Picasso painting.

49
Q

What happens to a contract if the supposition becomes true? Or not?

A

Verification = contract valid
If supposition is not true = contract void

50
Q

Can you have a supposition on a future event?

A

No, Van Reenen Steel v Smith, court held that will be a condition.

51
Q

Define a modus

A

Modus or modal clause is a term that charges the recipient of a perfromance with a duty to do something in the future. Exp donation of land and you need to build a school.

52
Q

What is a person does not comply with a modus?

A

Results in breach of contract

53
Q

Distinguish between a modus and a suspensive condition.

A

Modus - non-compliance is a breach of contract and resulting breach of contract remedies.
Suspensive condition - non-compliance terminates the contract

54
Q

Warranty?

A

Party assumes absolute liability for performance. A term inserted in a contract in favour of one party to extend the liability of the other party beyond what it would normally be. Even if the performance is impossible.

55
Q

What are the two types of conditions in contract law? And explain each

A

Suspensive = suspends the full operation of the contract until an uncertain even occurs or does not occur.
Resolutive = Continued existence of obligation is dependent on occurrence of uncertain future event.

56
Q

Explain the doctrine of fictional fulfilment of conditions

A

This is where a person deliberatively prevents the fulfilment of a condition where there is no duty not to do so. Want the contract to lapse, so take steps to prevent the fulfilment of a suspensive condition

57
Q

Requirements for thedoctrine of fictional fulfilment of conditions

A
  1. Prevention must be deliberate.
  2. Duty to not prevent fulfilment
  3. Causal relationship between conduct and non-fulfilment
58
Q

Define a time clause

A

A term making the operation of a contract depend on an event certain to arise in the future. Not sure when.

59
Q

How is the principal responsible for the agent in a representation contract? Latin?

A

P is vicariously responsible for the agent.
Qui facit per alium facit per se - he who acts through another is deemed himself to act

Contract Law 378 (5 decks)

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