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Certificate Level: Law > Types of Law and Contract Formation > Flashcards

Types of Law and Contract Formation Flashcards

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1
Q

Fill in the following blanks for CIVIL LAW

Parties involved:

Burden of proof:

Standard of proof (level of persuasion needed):

Potential outcome:

A

CIVIL LAW

Parties involved: Claimant and defendant

Burden of proof: the claimant must prove their case

Standard of proof (level of persuasion needed): on the balance of probabilities

Potential outcome: pay for damages/compensation (NOT fine, no punishment)

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2
Q

Fill in the following blanks for CRIMINAL LAW

Parties involved:

Burden of proof:

Standard of proof (level of persuasion needed):

Potential outcome:

A

CRIMINAL LAW

Parties involved: Prosecutor and accused

Burden of proof: Prosecution

Standard of proof (level of persuasion needed): beyond reasonable doubt

Potential outcome: punishment - imprisonment or fines

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3
Q

Who creates primary legislation?

A

Parliament

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4
Q

Who creates secondary legislation?

A

Organisations/individuals that parliament has delegated its law making powers to

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5
Q

Do laws made via primary vs secondary legislation have the same impact?

A

Yes

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6
Q

How is case law created?

A

Judicial precedent - judge’s decision sets a precedent for similar cases.

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7
Q

What are the three essential features of a simple contract?

A

Acceptance of an offer

Consideration

Intention

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8
Q

Do simple contracts need to be presented in a certain format?

A

No - do not need to be written or formally completed unless involves the sale of LAND in which case a deed must be exchanged

Where the contract is in the form of a deed, then consideration is not required

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9
Q

What are the four factors that affect the validity of a contract, regardless of whether the essential features are present?

A

a) Lack of capacity

b) Absence of free will

c) Illegality involved

d) Misrepresentation (someone has been misled)

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10
Q

What is the difference between a void and a voidable contract?

A

A void contract is not a contract at all - has some illegal element to its nature.
Parties are not bound by it and a inured party can generally recover all goods from a third party

A voidable contract can occur if one party had a lack of capacity, absence of free will or misrepresentation. That party is ABLE to VOID the contract. However, property transferred is usually unrecoverable from a third party

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11
Q

Which of the following features are present in an offer?

a) Offer must be possible
b) Further negotiation needed
c) Specific terms
d) Can be open to interpretation

A

a & c

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11
Q

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

A

Offer: Definite promise to be bound on specific terms
more than a supply of information or a statement of intention

Invitation to treat: an invitation by one party to to the other to enter into negotiations which could or could not lead to an offer. Encourages other people to make an offer - not capable of acceptance itself

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12
Q

What are the four ways in which an offer can be terminated?

A

Rejection

Counter offer - ceases original offer

Lapse of time

Revocation of offer that is communicated to offeree

Failure of precondition

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13
Q

The Unfair Contract Terms Act 1977 defines a consumer as;

a) Someone who makes a contract as a private individual

b) Someone who does not make a contract in the course of a business

A

b

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14
Q

What is the postal rule and in what situation does it apply?

A

Acceptance of an offer is completed as soon as the letter has been posted.

Must have been addressed and stamped properly and agreed upon by both parties.

Postal rules do not apply to revocation of an offer

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15
Q

What are the three types of consideration and are they generally valid or invalid?

A

Executory - valid. A promise for a promise

Executed - valid. An act executed for a promise.

Past - generally invalid. Act was carried out before agreement was formed

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16
Q

Must consideration be

a) Adequate

or

b) Sufficient

A

b

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17
Q

What are three exceptions to the privity of contracts rule?

A

Where agents act on behalf of a principle

Motor insurance companies

Where third parties are expressly identified in contract

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18
Q

In an action for breach of contract, the court will not award:

a) Damages for financial loss.
b) Unliquidated damages.
c) Liquidated damages.
d) Damages identified in a penalty clause.

A

d) Damages identified in a penalty clause.
Penalty clauses are void in contract law.

19
Q

Vincent sells paintings by Pablo in his art shop. He has undertaken not to advertise the paintings at a lower price than Pablo has specified, only to sell the paintings to private collectors, and not to display any of Pablo’s paintings without his permission. They have agreed that if Vincent breaks any of these conditions, he will have to pay Pablo £10,000.

Vincent hangs a picture that Pablo gave Vincent’s husband for Christmas the previous year above the counter in his shop. Pablo claims that Vincent does not have permission to display the picture and is demanding £10,000.

a) Vincent owes Pablo £10,000 as liquidated damages.
b) Vincent owes Pablo £10,000 under a penalty clause.
c) Vincent owes Pablo nothing because the penalty clause is void.
d) Vincent may choose to not pay Pablo because the penalty clause is voidable.

A

c) Vincent owes Pablo nothing because the penalty clause is void.

First statement is not right, because the fact that the fixed sum of damages arranged covers several issues implies that it is a penalty clause rather than a genuine pre-estimate of loss. If the pre-arranged sum is judged to be a penalty clause, then the clause is void.

20
Q

By virtue of the Unfair Contract Terms Act 1977, an attempt by any person to exclude or restrict their liability for damage to property caused by negligence is:
a) Void unless reasonable.
b) Effective only in a non-consumer transaction.
c) Void.
d) Valid if the other party to the contract knows of the exclusion clause or has been given reasonable notice of it.

A

a) Void unless unreasonable.
This is the rule in section 2 of the Act.

21
Q

David owed Michael £1,000. Michael said that he would accept a cheque.

a) If David were to offer £900 in cash instead of a cheque, would that constitute valid
consideration?

b) If Zak were to offer to pay £900 on behalf of David, would that constitute valid
consideration for Michael’s promise to release David from his original debt?

A

a) No
Paying cash instead of cheque is not sufficient to support the waiver of debt by Michael.

b) Yes.
The promise of payment from a third party, against whom the creditor previously had no claim, is sufficient.

22
Q

a) What forms primary legislation?

b)What is secondary legislation?

A

a) Acts of parliament

b) Delegated legislation
When a specific body or individual creates law on behalf of parliament

23
Q

Can civil law cases be settled out of court, even where the court has already begun hearing the case?

A

Yes

24
Q

For civil law;

a) Who are the parties involved?

b) Who is the burden of proof with?

c) What is the standard of proof?

d) What is the main remedy?

A

a) Claimant brings a case against the defendant

b) The burden of proof is with the claimant

c) The standard of proof is the balance of probability

d) The main remedy is the award of damages. There is no concept of punishment

25
Q

For criminal law;

a) Who are the parties involved?

b) Who is the burden of proof with?

c) What is the standard of proof?

d) What is the main remedy?

A

a) Prosecutor (state) brings a case against the accused

b) The prosecutor

c) Beyond reasonable doubt

d) Punishment to those found guilty

26
Q

What are the three essential elements that must be present in a contract?

A
  1. Agreement
  2. An intention to create legal relations
  3. Consideration
27
Q

At what point will the law intervene in a contract between two parties?

A

If one seeks an unfair advantage as a result of their superior bargaining position

28
Q

When does a contract become unenforceable?

A
  1. If either party fails to perform their part of the contract, the other party cannot compel them to do so
  2. If a contract is not in the correct form. e.g for the transfer of land or consumer credit agreements these must be in writing
  3. Terms of a guarantee must be evidenced in writing before any action is brought
29
Q

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

A

An invitation to treat cannot be accepted to form a binding contract - it is simply an invitation that a person is prepared to receive offers with a view to enter into a contract

30
Q

Are advertisements offers or Invitations To Treat?

A

Generally ITTs

31
Q

a) What is the postal rule?

b) Does it apply to acceptance and revocation of an offer?

c) Can the postal rule apply where the offeror requires acceptance ‘by notice in writing’?

A

a) Where acceptance of an offer is made by post, communication will be effective the moment the acceptance is posted, even id it is delayed or lost altogether

b) Applies to acceptance, not revocation - revocation has to be received by offeree

c) No, the word notice means that it must be received by the offeror

32
Q

Can acceptance of an offer be inferred by conduct?

A

Yes - but not by silence

33
Q

Does an offeree have to be aware of an offer in order to accept?

A

Yes

34
Q

Define the following types of consideration and indicate whether they are generally valid or invalid;

a) Executed
b) Executory
c) Past

A

a) Executed - A performed act in return for a promise. Valid

b) Executory - A promise for a promise. Valid

c) Past - Something which has already been done at the time the promise is made. Invalid

35
Q

What is an exception to the rule of consideration being needed to form a contract?

A

Where a contract is in the form of a deed.

36
Q

Must consideration be adequate or sufficient?

A

Sufficient

37
Q

Can the following be considered sufficient consideration?

a) Performance of an existing statutory duty

b) Performance of an existing contractual duty owed to the promiser

c) Performance of an existing contractual duty owed to a third party

d) Forbearance or waiver of an existing right

A

a) No

b) No

c) Yes

d) Yes

38
Q

What is a severable contract?

A

A contract made up of a number of obligations; a contract can be severed after only part of the obligations are completed

39
Q

What is a quantim meruit action?

A

A claim where a person is paid for the work they have already completed

40
Q

When an anticipatory breach of a contract occurs, at what point does the injured party have a duty to mitigate their losses?

A

Not until they accept the breach

41
Q

a) What are liquidated damages?

b) What is a penalty clause

A

a) Up-front fixed sums or formulas included in contracts for determining damages payable for a breach

b) Similar to liquidated damages but the sum does not protect the innocent party and is excessive. Not usually enforceable unless it is proportionate to the primary contractual obligation

42
Q

Can a specific performance order be made regarding personal service?

Can a specific performance order be made if it requires supervision of the performance?

A

No

43
Q

Define the following types of injunctions;

a) A mandatory injunction

b) A prohibitory injunction

c) An asset freezing injunction

A

a) Defendant has to take positive actions to undo something they have already done in breach of contract

b) Defendant is to observe a negative promise in contract - to not do something

c) Prevents the defendant from dealing with assets if they are likely to be exported or dissipated

44
Q

What is an exclusion clause?

A

One that restricts liability for breach of contract

Party must be made sufficiently aware of clause

45
Q

What relevance does the Unfair Contract Terms Act have on exclusion clauses?

A

UCTA is concerned with business liability (does not cover insurance or land contracts)

Does not apply to private persons

Any clause that attempts to restrict liability for death or personal injury from negligence is void

Any clause that attempts to restrict liability for damage from negligence is void unless reasonable

Term must be reasonable - proof of reasonableness lies with the perosn relying on clause

46
Q

What relevance does the Consumer Rights Act have on exclusion clauses?

A

Relevant in contracts between businesses and consumers

Only binding if fair to consumer

Any clause that attempts to restrict liability for death or personal injury from negligence is void

Cannot restrict consumer’s legal rights

Unfair terms do not invalidate the whole contract

A business can be considered a consumer if purchase is outside course of business

Certificate Level: Law (5 decks)

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