Contract law 1

Contract
1. An exchange of promises that can be enforced
2. Essential elements
  1. Offer
  2. Acceptance
  3. Consideration
  4. Intention to be bound
3. Other elements
  1. Capacity- to contract
  2. Particular form
Offer/ Invitation to treat
1. Offer
  1. Anyone with legal capacity can make an offer
    1. Writing
    2. Orally
    3. In contract
2. Goods displayed on the shelf ina self service shop represent an invitation to treat. An offer is only made when the customer presents the goods at checkout.
3. Invitation to treat
  1. Invitation to 'make an offer'
  2. Tender is classed as an invitation to treat
  3. Difference between offer an invitation can be difficult to distinguish but depends on intention of parties
  4. Carlil v Carbolic smoke ball co (1892) (unilaberal offer)
4. Communication to offer
  1. any method acceptable
    1. Taylor v Laird 1856
  2. Must be clear, unambigious and capable of acceptance
    1. Compare £495 to about £500
5. Offer remains open until
  1. End of stated period
  2. Death of offerer/ offeree
  3. Until rejected
  4. Withdrawn
  5. Unless counter offer made
6. Revocation of offer
  1. May be withdrawn at any time prior to acceptance
  2. Withdrawal must be communicated
  3. Must reach oferee prior to acceptance
    1. Byrne and Co V Van Tienhoven 1880
7. Acceptance of offer
  1. Must be communicated
    1. Orally
    2. Writing
    3. Conduct (Brogdon V Metropolitan Rly Co 1877)
  2. Unqualified assent to terms of offer
  3. Silence cannot amount to acceptance
    1. Felthouse v Binally 1862
8. Counter offers
  1. If purpoted accepted, introduces new terms or is different to offer, it becomes a counter offer, this kills the original offer
    1. Mirror image rule
    2. Hyde V wrench (1840)
  2. Request for info/ clarrification is not a counter offer, so original offer remains and is open for acceptance
    1. Stevenson Jaques & co V Mclean 1880
  3. Battle of the forms
    1. Use of each parties own standard terms of business
    2. Butler machine tool Co ltd V Ex-cell-O Corp ltd (1979) (last shot doctrine)
      1. Lord Denning MR: Found it most cases where battle of the forms is used that there is a contrast as soon as the last of the forms is sent and recieved without objection being taken to it.
    3. Chistery Joinery ltd V John Mowlem & co (1987)
      1. Last shot wins
Acceptance
1. Acceptance is complete at the time a letter of acceptance is posted
  1. Adams V Lindsell 1818
  2. Henthorn V Fraser 1872
Consideration
1. Essentials
  1. Gives benifit to another or some detriment from the other
  2. Mutual exchange of promises
  3. Price of each others promise
  4. Need not to be adequate
  5. May be money, Goods, services, work done, or a promise not to sue
  6. Characterised as factual benifit or avoidance of factualdisbenifit
    1. William V Roffey & Nicholls 1990
2. Past consideration
  1. No consideration
  2. You dug the garden for me so I will buy you a beer
3. Executed consideration
  1. Performed at the time of making contract
  2. Here is 50p in exchange for the newspaper
4. Executory consideration
  1. Performed in future
  2. I promise to complete your house by xmas next year
5. Performance of an existing duty
  1. Stilk V Myrick
  2. Williams V Roffey Brothers & Nichols
6. Part payment of a debt
  1. Pinnels case
    1. £8 10 S due nov 11
    2. £5 2S paid oct 1
  2. Foakes V Beer
    1. Matter of interest
Intention to be bound
1. If all essentials exist, usual inference is that intention exists
2. Execption is family arrangements
3. Legal capacity/ personal capacity
  1. Execptions
    1. Minor
    2. Drunk
    3. Insanity
    4. Limit of power for corperations e.g. public bodies
4. Particular form
  1. Sale of land
  2. Hire purchase
  3. Contracts of guarentee
Contract terms
1. Categories of contract terms
  1. Express terms
    1. terms that have been specifically stated and writeen down and agreed by both parties involved in the contract
    2. Written down
    3. Orally agreed
  2. Implied terms
    1. Implied by custom
    2. Implied by courts
      1. In law
      2. In fact
    3. Implied by statute
  3. Conditions
  4. Warranties
2. Implied by Custom
  1. Local custom
    1. Hutton V Warren 1836
      1. Agricultural lease terminated by landlord
      2. Custom that work done in tilling, sowing and cultiuvation crops not yet harvested would be paid for
        Not if express terms contracted custom
3. Implied by Court
  1. Implied in fact
    1. The moorcock 1889
      1. Mooring/ low tide/ grounded/ damage
      2. Moor owner done nothing to assertain whether river bed adjacent was suitable
    2. Such a term was implied to give business efficacy to the contract
    3. Shirlaw V southern foundries 1939
      1. Officious bystander test
      2. Something thats so obvious it goes without saying
  2. Implied in law
    1. Liverpool city council V Irwin 1977
      1. Lord Salmon found the landlord in no legal duty to keep the lifts working and the staircase lit
    2. Test is a necessity not reasonableness
  3. Construction examples
    1. Drake & Skull V Higgs & Hill (1995)
      1. Agreement of all matters except daywork rates
      2. Contract with implied term that the sub contractor would be paid a reasonable sum
    2. Mitsui Babcock Energy V John Brown Engineering (1996)
      1. Failure to agree tests & liquidated damages
      2. Made a coherant & Workable contract
4. Implied by Statute
  1. Examples
    1. Sale of Goods act 1979
    2. Supply of goods and services act 1982
    3. Building Act 1984
    4. HGCRA 1996
    5. DDM 2007
  2. Sale of goods act 1979
    1. S.13/ Goods must corespond with their descriptions
    2. S.14/ (2) Satisfactory quality
    3. S.14/ (3) Fit for particular purpose
    4. S.15/ Sale by sample
      1. bulk of goods/ corresopond with sample
      2. Defect free not aparant/ reasonable examination
    5. S.12/ Seller must have title to goods
  3. Supply of goods and services act 1982
    1. S.2/ Implied warranty as to title
    2. S.4/ Implied term as to quality or fitness
    3. S.12/ Contract for the supply of a service
    4. S.13/ Reasonable care and skill
    5. S.14/ Carry out service within a reasonable time
    6. S.15/ Pay a reasonable charge
  4. Contracts for work & materials
    1. Young & Martin V Mcmanus Childs (1969)
      1. Roofing tiles selected by employers
      2. Suitable warranties, adapted to the nature of contract should be applied in contracts where mixed elements of supply/ goods/ work to be done
  5. Title to goods
    1. Aluminium industries V Romalpa (1976)
      1. Court of appeal upheld a clause which prevented the passing of property in goods until paid for
      2. Quicquick plantitur solo solo credit
      3. Some perculiarities within construction contracts
  6. Sale of dwellings
    1. National house building council (NHBC)
    2. Defective premises act 1972
      1. Workmanlike or proffessinal manner
      2. Proper materials
      3. Fit for habitation
    3. Housing act 2004
      1. Vendor to provide energy performance certificate
  7. Time for performance
    1. Time of the essence cannot be implied
    2. Needs to be express terms
    3. Time for completion can be stipulated in construction contract although no normally an essential element
      1. Remedy
        Common law assertainment of damages
        Liquidated damages for late completion

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	Created by p.christmas-12 almost 11 years ago