PGDL STUDY GUIDE
CONTRACT
LAW
Understand it. Apply it. Ace it.
Clear notes. Key cases. Exam focused.
Everything you need to succeed.
CONTENTS
01 Agreement and Contractual Intention 2
02 Offers 3
03 Acceptance 4
04 Terminating an Offer 5
05 Consideration & Promissory Estoppel 6
06 Contents of a Contract 8
07 Exclusion Clauses & Unfair Terms 9
08 Remedies (Damages) 10
09 Discharge of a Contract 12
10 Misrepresentation & Mistake 13
11 Privity, Capacity, Agency & Duress 14
12 Certainty & Interpretation 15
★ 30-Second Full Revision 16
You've got this! ♡
, 01 AGREEMENT AND CONTRACTUAL INTENTION
WHAT IS A CONTRACT?
A legally binding agreement between two or more parties which the law will enforce. It is formed once one
party makes an offer which is accepted by the other.
THREE ESSENTIAL INGREDIENTS
Agreement + Intention to create + Consideration
legal relations
INTENTION TO CREATE LEGAL RELATIONS
Assessed objectively (Smith v Hughes) — would a reasonable person think the parties intended to be bound?
Contracts need not be in writing — oral agreements are enforceable
DOMESTIC & SOCIAL COMMERCIAL
Presumed NOT intended to be legally binding. Strong presumption parties DO intend legal relations
Balfour v Balfour [1919] — husband's maintenance (Edwards v Skyways [1964]). Rebutted by an express
promise to wife was purely domestic. clause — Rose & Frank v Crompton [1925].
REBUTTING THE PRESUMPTION
Courts weigh: (a) value of the consideration, (b) whether parties bargained at arm's length (e.g. separated couples), (c)
whether the agreement is formal/written. Merritt v Merritt [1970] — written, signed agreement between separated
spouses was binding.
EXAM TIP
Identify the type of relationship first, then look for words, conduct and circumstances that could rebut the presumption.
, 02 OFFERS
Professor Treitel: an offer is 'an expression of willingness to contract on certain terms, made with the
intention that it shall become binding as soon as it is accepted' (confirmed in Allied Marine Transport v Vale do
Rio Doce (The Leonidas D)).
KEY FEATURES OF AN OFFER
Intention to Definite Communicated Capable of
be bound terms to the offeree acceptance
INVITATIONS TO TREAT
A statement inviting negotiation — no intention to be bound. Common examples: adverts, price lists, shop
displays, tenders.
Pharmaceutical Society of GB v Boots [1953] — goods on a shelf are an invitation to treat; the offer is made at the till.
Partridge v Crittenden [1968] — a classified ad is an invitation to treat, not an offer.
CASE EXAMPLE — CARLILL v CARBOLIC SMOKE BALL CO [1893]
A £100 reward advert for anyone who caught flu despite using the smoke ball as directed was an offer — sincere,
addressed to the world, and acceptance was by performance (no need to communicate acceptance). Basis of the
unilateral contract.
UNILATERAL BILATERAL
A promise for an act — 'if you do X, I promise Y'. No A promise for a promise — 'I promise to sell if you
obligation until the act is performed (Errington v promise to buy'.
Errington).
AUCTIONS TENDERS
The call for bids = invitation to treat; bids = offers; the fall of Invitations to tender are usually invitations to treat (Spencer
the hammer = acceptance. 'Without reserve' can bind the v Harding); submitted tenders are offers. Exception: an
auctioneer to accept the highest bid (Barry v Davies). implied duty to consider all conforming tenders (Blackpool
Aero Club v Blackpool BC).
CONTRACT
LAW
Understand it. Apply it. Ace it.
Clear notes. Key cases. Exam focused.
Everything you need to succeed.
CONTENTS
01 Agreement and Contractual Intention 2
02 Offers 3
03 Acceptance 4
04 Terminating an Offer 5
05 Consideration & Promissory Estoppel 6
06 Contents of a Contract 8
07 Exclusion Clauses & Unfair Terms 9
08 Remedies (Damages) 10
09 Discharge of a Contract 12
10 Misrepresentation & Mistake 13
11 Privity, Capacity, Agency & Duress 14
12 Certainty & Interpretation 15
★ 30-Second Full Revision 16
You've got this! ♡
, 01 AGREEMENT AND CONTRACTUAL INTENTION
WHAT IS A CONTRACT?
A legally binding agreement between two or more parties which the law will enforce. It is formed once one
party makes an offer which is accepted by the other.
THREE ESSENTIAL INGREDIENTS
Agreement + Intention to create + Consideration
legal relations
INTENTION TO CREATE LEGAL RELATIONS
Assessed objectively (Smith v Hughes) — would a reasonable person think the parties intended to be bound?
Contracts need not be in writing — oral agreements are enforceable
DOMESTIC & SOCIAL COMMERCIAL
Presumed NOT intended to be legally binding. Strong presumption parties DO intend legal relations
Balfour v Balfour [1919] — husband's maintenance (Edwards v Skyways [1964]). Rebutted by an express
promise to wife was purely domestic. clause — Rose & Frank v Crompton [1925].
REBUTTING THE PRESUMPTION
Courts weigh: (a) value of the consideration, (b) whether parties bargained at arm's length (e.g. separated couples), (c)
whether the agreement is formal/written. Merritt v Merritt [1970] — written, signed agreement between separated
spouses was binding.
EXAM TIP
Identify the type of relationship first, then look for words, conduct and circumstances that could rebut the presumption.
, 02 OFFERS
Professor Treitel: an offer is 'an expression of willingness to contract on certain terms, made with the
intention that it shall become binding as soon as it is accepted' (confirmed in Allied Marine Transport v Vale do
Rio Doce (The Leonidas D)).
KEY FEATURES OF AN OFFER
Intention to Definite Communicated Capable of
be bound terms to the offeree acceptance
INVITATIONS TO TREAT
A statement inviting negotiation — no intention to be bound. Common examples: adverts, price lists, shop
displays, tenders.
Pharmaceutical Society of GB v Boots [1953] — goods on a shelf are an invitation to treat; the offer is made at the till.
Partridge v Crittenden [1968] — a classified ad is an invitation to treat, not an offer.
CASE EXAMPLE — CARLILL v CARBOLIC SMOKE BALL CO [1893]
A £100 reward advert for anyone who caught flu despite using the smoke ball as directed was an offer — sincere,
addressed to the world, and acceptance was by performance (no need to communicate acceptance). Basis of the
unilateral contract.
UNILATERAL BILATERAL
A promise for an act — 'if you do X, I promise Y'. No A promise for a promise — 'I promise to sell if you
obligation until the act is performed (Errington v promise to buy'.
Errington).
AUCTIONS TENDERS
The call for bids = invitation to treat; bids = offers; the fall of Invitations to tender are usually invitations to treat (Spencer
the hammer = acceptance. 'Without reserve' can bind the v Harding); submitted tenders are offers. Exception: an
auctioneer to accept the highest bid (Barry v Davies). implied duty to consider all conforming tenders (Blackpool
Aero Club v Blackpool BC).
