Contract Problem Question Structure
Notes:
- Formal language
- Define important terms
- Deal with events in chronological order
- Don’t make the distinction between common law and equitable doctrine (promissory estoppel)
- Very structured – follow the structure provided
- Deal with each distinct contract issue separately (logical structure) (Issue, Contract, Breach, Exemption
Clause, Incorporated, Remedies, etc)
- IRAC – state the Introduction identifying the Issue, legal rule (with Authority – case or statutory provision)
apply to the facts and Conclude
Overall Structure:
1. Identify a contract/VARIATION of a contract
a. If there’s no contract there will not be a remedy in contract law
i. Agreement (offer and acceptance)
ii. Consideration
iii. Intention to create legal relations
1. Parties
a. Agency
2. Contract established terms of the contract
a. Express
b. Implied
i. By the courts
ii. Statute
c. Exemption clauses
i. Common law rules
ii. Statutory controls
3. Remedies for breach of contract a breach of contract occurs when a party fails to perform its obligations
under the contract without lawful excuse
, a. Damages aim is to compensate the innocent party for loss of bargain
b. Termination
c. Specific Performance/injunction
d. Discharge The parties relieved from performance i.e. by agreement, performance, breach, and
frustration
e. Restitution
f. Guarantees and indemnities
g. Rescission
4. Doctrine of complete performance
5. Frustration
6. Vitiating Factors
a. Misrepresentation
b. Mistake
c. Duress and undue influence
Agreement and Contractual Intention
Offer and acceptance questions
- Issue – is there a valid contract?
- Rule – a contract requires agreement (offer + acceptance), consideration and intention to create legal
relations
o Offer – a definite promise to be bound by specified terms (Professor Treitel) (offeror)
o Acceptance – the unqualified assent to the terms of the offer which is normally required to have been
communicated to the offeror (R v Clarke) (offeree)
o [identify the parties] – consider capacity if relevant
- Application – apply the facts to each legal requirement
o Offer: Identify if a statement is an offer or an invitation to treat
Offer caveats:
Counteroffer
o Will destroy the original offer (Hyde v Wrench)
, o ‘Battle of the forms’ – The last counter-offer accepted without objection will govern
the contract ‘last shot rule’ (Butler Machine Tool v Ev- Cell- O Corp; Brogden v
Metropolitan Railway Co) [links to incomplete agreements below]
However up to the court’s discretion (First form won - TRW Ltd v Panasonic
Industry Europe GmbH and another company; neither party’s terms - Lidl UK
Gmbh v Hertford Foods Ltd. & Anor)
Incomplete agreements – [LINK TO VARIATION OF CONTRACT]
o The court will consider the whole correspondence to assess intent and completeness
(objectively), but the facts have to be judged in context
Judged objectively consideration of both vagueness and incompleteness
Vagueness: A contract addresses key issues but lacks precision
o The courts task is to find a meaning of the words which is both
sufficiently certain to allow the court to work out whether the contract
has been compiled with, but which can fairly be said to reflect the
intentions of the parties
o Incompleteness: A contract omits important matters entirely
If something ‘key’ or ‘legally essential’ is omitted, then,
contractual intention or not, the agreement can’t be enforced
The bottom line is that the law will strive to uphold contracts. So
the contract will be enforceable unless the contract is either
unworkable, or too uncertain without the term in question being
added in
Statutory implications can imply terms into contracts
1. Terms implied by custom if the custom is notorious,
certain and reasonable, and generally regarded as binding
2. Term implied in fact if it is necessary to give the contract
business efficacy (The Moorcock)
3. Term implied in law if it is what the nature of the contract
itself implicitly requires
o If key express terms remain unresolved, no binding offer exists (Hussey v Horne-
Payne)
, Whether the parties are in the same trade
Trade usage
Whether the agreement has been acted on for any length of time
Whether there is an objective mechanism for resolving any uncertainty such as
an arbitration clause
Request for information
o Will not destroy the offer but neither will it amount to an acceptance (Stevenson
Jacques and Co v McLean)
Invitation to treat
o Shop-service and shop window displays the customer offers to buy the goods
when the customer presents them at the payment point, and acceptance takes place
when the shop takes payment for the goods (Pharmaceutical Society of Great Britain
v Boots Cash Chemists; Fisher v Bell)
o Advertisements (Partridge v Crittenden) HOWEVER
An advertisement of a reward treated as an offer (Williams v Carwardine)
o Auctions
S 57(2) of the Sale of Goods Act (SGA) 1979
Auctioneer calls for bids (invitation to treat)
Bids can be withdrawn at any time before acceptance
a sale by auction is complete on the fall of the auctioneer’s hammer
(acceptance)
Auctioneer acts as the agent of the owner in order to form the contract
S 57(3) – ‘reserve price’
Without reserve price – unilateral contract (Barry v Davies) – can claim
damages against the auctioneer NOT the owner
With reserve price – bilateral contract between owner and bidder
o Tenders (Spencer v Harding) HOWEVER
Could give rise to a unilateral contract (Harvela Investments Ltd v Royal Trust
Company Ltd; Blackpool & Fylde Aero Club v Blackpool Borough Council –
implied promise to consider all tenders submitted on time)
Notes:
- Formal language
- Define important terms
- Deal with events in chronological order
- Don’t make the distinction between common law and equitable doctrine (promissory estoppel)
- Very structured – follow the structure provided
- Deal with each distinct contract issue separately (logical structure) (Issue, Contract, Breach, Exemption
Clause, Incorporated, Remedies, etc)
- IRAC – state the Introduction identifying the Issue, legal rule (with Authority – case or statutory provision)
apply to the facts and Conclude
Overall Structure:
1. Identify a contract/VARIATION of a contract
a. If there’s no contract there will not be a remedy in contract law
i. Agreement (offer and acceptance)
ii. Consideration
iii. Intention to create legal relations
1. Parties
a. Agency
2. Contract established terms of the contract
a. Express
b. Implied
i. By the courts
ii. Statute
c. Exemption clauses
i. Common law rules
ii. Statutory controls
3. Remedies for breach of contract a breach of contract occurs when a party fails to perform its obligations
under the contract without lawful excuse
, a. Damages aim is to compensate the innocent party for loss of bargain
b. Termination
c. Specific Performance/injunction
d. Discharge The parties relieved from performance i.e. by agreement, performance, breach, and
frustration
e. Restitution
f. Guarantees and indemnities
g. Rescission
4. Doctrine of complete performance
5. Frustration
6. Vitiating Factors
a. Misrepresentation
b. Mistake
c. Duress and undue influence
Agreement and Contractual Intention
Offer and acceptance questions
- Issue – is there a valid contract?
- Rule – a contract requires agreement (offer + acceptance), consideration and intention to create legal
relations
o Offer – a definite promise to be bound by specified terms (Professor Treitel) (offeror)
o Acceptance – the unqualified assent to the terms of the offer which is normally required to have been
communicated to the offeror (R v Clarke) (offeree)
o [identify the parties] – consider capacity if relevant
- Application – apply the facts to each legal requirement
o Offer: Identify if a statement is an offer or an invitation to treat
Offer caveats:
Counteroffer
o Will destroy the original offer (Hyde v Wrench)
, o ‘Battle of the forms’ – The last counter-offer accepted without objection will govern
the contract ‘last shot rule’ (Butler Machine Tool v Ev- Cell- O Corp; Brogden v
Metropolitan Railway Co) [links to incomplete agreements below]
However up to the court’s discretion (First form won - TRW Ltd v Panasonic
Industry Europe GmbH and another company; neither party’s terms - Lidl UK
Gmbh v Hertford Foods Ltd. & Anor)
Incomplete agreements – [LINK TO VARIATION OF CONTRACT]
o The court will consider the whole correspondence to assess intent and completeness
(objectively), but the facts have to be judged in context
Judged objectively consideration of both vagueness and incompleteness
Vagueness: A contract addresses key issues but lacks precision
o The courts task is to find a meaning of the words which is both
sufficiently certain to allow the court to work out whether the contract
has been compiled with, but which can fairly be said to reflect the
intentions of the parties
o Incompleteness: A contract omits important matters entirely
If something ‘key’ or ‘legally essential’ is omitted, then,
contractual intention or not, the agreement can’t be enforced
The bottom line is that the law will strive to uphold contracts. So
the contract will be enforceable unless the contract is either
unworkable, or too uncertain without the term in question being
added in
Statutory implications can imply terms into contracts
1. Terms implied by custom if the custom is notorious,
certain and reasonable, and generally regarded as binding
2. Term implied in fact if it is necessary to give the contract
business efficacy (The Moorcock)
3. Term implied in law if it is what the nature of the contract
itself implicitly requires
o If key express terms remain unresolved, no binding offer exists (Hussey v Horne-
Payne)
, Whether the parties are in the same trade
Trade usage
Whether the agreement has been acted on for any length of time
Whether there is an objective mechanism for resolving any uncertainty such as
an arbitration clause
Request for information
o Will not destroy the offer but neither will it amount to an acceptance (Stevenson
Jacques and Co v McLean)
Invitation to treat
o Shop-service and shop window displays the customer offers to buy the goods
when the customer presents them at the payment point, and acceptance takes place
when the shop takes payment for the goods (Pharmaceutical Society of Great Britain
v Boots Cash Chemists; Fisher v Bell)
o Advertisements (Partridge v Crittenden) HOWEVER
An advertisement of a reward treated as an offer (Williams v Carwardine)
o Auctions
S 57(2) of the Sale of Goods Act (SGA) 1979
Auctioneer calls for bids (invitation to treat)
Bids can be withdrawn at any time before acceptance
a sale by auction is complete on the fall of the auctioneer’s hammer
(acceptance)
Auctioneer acts as the agent of the owner in order to form the contract
S 57(3) – ‘reserve price’
Without reserve price – unilateral contract (Barry v Davies) – can claim
damages against the auctioneer NOT the owner
With reserve price – bilateral contract between owner and bidder
o Tenders (Spencer v Harding) HOWEVER
Could give rise to a unilateral contract (Harvela Investments Ltd v Royal Trust
Company Ltd; Blackpool & Fylde Aero Club v Blackpool Borough Council –
implied promise to consider all tenders submitted on time)
