Week Five Flashcards
What does contractual terms governance determine?
It determines which terms govern a contract.
What often leads to competing terms in contracts?
The utilization of standard forms and non-negotiated terms by both parties.
What questions arise from competing terms and disputes?
Questions about the existence of a contract, consensus, and which terms prevail.
What is fundamental to deciding contractual terms in “battle of the forms” scenarios?
Offer and acceptance.
What is the “last shot” analysis?
It often determines the governing terms in a contract.
What are some case references for the “last shot” analysis?
Uniroyal Ltd v Miller & Co Ltd 1985 SLT 101.
Continental Tyre & Rubber Co Ltd v Trunk Trailer Ltd 1985 SC 163.
What approach did Lord Denning suggest in Butler Machine Tool Co v Ex-cell-o Corp [1979] 1 ALL ER 965?
Analyze all documents and conduct between parties to determine agreement.
How do courts handle competing terms?
Courts assess if terms were made clear from inception and prevailed over any contrary suggestions.
What is the position on counter-offers?
Counter-offers nullify original offers and terms.
What was Lord Malcolm’s position in Specialist Insulation Ltd v Pro-Duct [2012] CSOH 79?
Negotiations should assume acceptance only occurs with explicit written agreement.
What type of clause is an arbitration clause?
An arbitration clause is a contractual clause that requires parties to resolve disputes through arbitration, rather than in court
What is the significance of an arbitration clause?
Specifies that disputes will be resolved through arbitration under specified rules (Y Rules).
Includes details such as the number of arbitrators and the legal seat of arbitration.
Why is an arbitration clause important?
Provides a clear method and forum for dispute resolution.
Can offer a more private and potentially faster resolution process compared to court litigation.
The seat of arbitration can affect applicable legal procedures and enforcement.
What type of clause is a governing law and jurisdiction clause?
A governing law and jurisdiction clause is a contract clause that specifies the law that will govern the interpretation of the contract and the location where any disputes will be resolved
What is the significance of a governing law and jurisdiction clause?
Determines the legal system that will govern the contract and any related disputes.
Grants exclusive jurisdiction to the courts of a specified country to settle disputes.
Why is a governing law and jurisdiction clause important?
Provides certainty and predictability regarding which laws apply.
Ensures disputes are handled in a familiar legal environment.
Reduces the risk of jurisdictional conflicts.
What type of clause is an entire agreement clause?
An entire agreement clause is a legal provision in a contract that defines the scope of the agreement and states that the contract is the complete and final understanding between the parties.
What is the significance of an entire agreement clause?
Affirms that the written contract represents the complete and final agreement between the parties.
Supersedes all prior agreements, whether oral or written.
What is the purpose of an entire agreement clause?
Prevents parties from relying on previous statements or negotiations not included in the contract.
Clarifies that the written contract is the sole source of the parties’ agreement.
What is the legal context of an entire agreement clause?
Supported by the Contract (Scotland) Act 1997, which presumes a document contains all express terms unless proven otherwise.
Extrinsic evidence may be admissible to show additional terms unless a clause states the document is conclusive.
What is the objective of principles of interpretation in contract law?
To determine and give effect to the parties’ common intention.
What are the approaches to interpreting contracts?
Objective Approach: Considers the surrounding circumstances to understand parties’ intentions.
Literal Approach: Focuses on the ordinary meaning of the words used.
Common Sense Approach: Avoids interpretations leading to absurd results.
Contra Proferentem: In cases of ambiguity, interprets against the party relying on the clause (e.g., exclusion clauses).
What are the essential features of a valid contract?
Offer and Acceptance: A clear offer by one party, accepted by another.
Capacity: All parties must have the legal capacity to contract.
Consideration: Something of value must be exchanged.
Intention to Create Legal Relations: Both parties must intend for the agreement to be legally binding.
Legality: The purpose of the contract must be legal.
What are errors in the substantials?
Mistakes that go to the root of the contract, involving fundamental aspects.
What are the types of errors in the substantials?
Mistakes in identity, subject matter, or terms.
Mutual mistakes where both parties misunderstand each other.
Unilateral mistakes known to one party and exploited.
What is the effect of errors in the substantials on the validity of a contract?
Errors can render a contract void or voidable, depending on the nature of the mistake.
What issues did Taylor v Provan address?
Issues of capacity and intent to contract, specifically examining when a person’s mental state affects the validity of a contract.
Why could the contract not be set aside in Boyd & Forrest v The Glasgow and South-Western Railway Co?
The contract was not set aside due to lack of clear evidence proving misrepresentation or mistake.
Emphasized the importance of proving a substantial error that affected the decision to contract.
Highlighted that mere error or hardship is not sufficient to nullify a contract unless it goes to the root of the agreement.
