Week Five

Question 1

What does contractual terms governance determine?

Answer 1

It determines which terms govern a contract.

Question 2

What often leads to competing terms in contracts?

Answer 2

The utilization of standard forms and non-negotiated terms by both parties.

Question 3

What questions arise from competing terms and disputes?

Answer 3

Questions about the existence of a contract, consensus, and which terms prevail.

Question 4

What is fundamental to deciding contractual terms in “battle of the forms” scenarios?

Answer 4

Offer and acceptance.

Question 5

What is the “last shot” analysis?

Answer 5

It often determines the governing terms in a contract.

Question 6

What are some case references for the “last shot” analysis?

Answer 6

Uniroyal Ltd v Miller & Co Ltd 1985 SLT 101.

Continental Tyre & Rubber Co Ltd v Trunk Trailer Ltd 1985 SC 163.

Question 7

What approach did Lord Denning suggest in Butler Machine Tool Co v Ex-cell-o Corp [1979] 1 ALL ER 965?

Answer 7

Analyze all documents and conduct between parties to determine agreement.

Question 8

How do courts handle competing terms?

Answer 8

Courts assess if terms were made clear from inception and prevailed over any contrary suggestions.

Question 9

What is the position on counter-offers?

Answer 9

Counter-offers nullify original offers and terms.

Question 10

What was Lord Malcolm’s position in Specialist Insulation Ltd v Pro-Duct [2012] CSOH 79?

Answer 10

Negotiations should assume acceptance only occurs with explicit written agreement.

Question 11

What type of clause is an arbitration clause?

Answer 11

An arbitration clause is a contractual clause that requires parties to resolve disputes through arbitration, rather than in court

Question 12

What is the significance of an arbitration clause?

Answer 12

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.

Question 13

Why is an arbitration clause important?

Answer 13

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.

Question 14

What type of clause is a governing law and jurisdiction clause?

Answer 14

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

Question 15

What is the significance of a governing law and jurisdiction clause?

Answer 15

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.

Question 16

Why is a governing law and jurisdiction clause important?

Answer 16

Provides certainty and predictability regarding which laws apply.

Ensures disputes are handled in a familiar legal environment.

Reduces the risk of jurisdictional conflicts.

Question 17

What type of clause is an entire agreement clause?

Answer 17

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.

Question 18

What is the significance of an entire agreement clause?

Answer 18

Affirms that the written contract represents the complete and final agreement between the parties.

Supersedes all prior agreements, whether oral or written.

Question 19

What is the purpose of an entire agreement clause?

Answer 19

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.

Question 20

What is the legal context of an entire agreement clause?

Answer 20

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.

Question 21

What is the objective of principles of interpretation in contract law?

Answer 21

To determine and give effect to the parties’ common intention.

Question 22

What are the approaches to interpreting contracts?

Answer 22

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).

Question 23

What are the essential features of a valid contract?

Answer 23

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.

Question 24

What are errors in the substantials?

Answer 24

Mistakes that go to the root of the contract, involving fundamental aspects.

Question 25

What are the types of errors in the substantials?

Answer 25

Mistakes in identity, subject matter, or terms.

Mutual mistakes where both parties misunderstand each other.

Unilateral mistakes known to one party and exploited.

Question 26

What is the effect of errors in the substantials on the validity of a contract?

Answer 26

Errors can render a contract void or voidable, depending on the nature of the mistake.

Question 27

What issues did Taylor v Provan address?

Answer 27

Issues of capacity and intent to contract, specifically examining when a person’s mental state affects the validity of a contract.

Question 28

Why could the contract not be set aside in Boyd & Forrest v The Glasgow and South-Western Railway Co?

Answer 28

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.