CONTRACT EXAM STRUCTURE
Points to note:
Answer the question in CHRONOLOGICAL order.
Remember to use IRAC on every individual issue. ISSUE, RULE, APPLICATION, CONCLUSION.
DEFINE important terms.
THERE IS NO RIGHT ANSWER – show that you understand the implications of applying a legal rule and the difficulties of applying it in practice.
Use headings:
o Head each paragraph with the relevant legal issue: Adam v Harry in Negligence.
Language:
o Clear, concise, to the point.
CONCLUSION = CRITICAL EVALUATION + ANALYTICAL.
,UNIT 1 – Offer and Acceptance
Step 1: Identify who is seeking to show a contract exists. (If there is more than one character, deal with SEPERATELY and in CHRONOLOGICAL order)
If it’s in a commercial context STATE that contractual intention will be presumed (Edwards v Skyways) and then state what the real issue is.
Step 2: State the elements needed to form a contract
1) AGREEMENT (Offer & Acceptance)
a. Offer: definite promise to be bound by specified terms capable by being accepted without further negotiation (Treitel)
b. Acceptance: a complete and unqualified acceptance of all the terms of the offer (Treitel)
2) INTENTION TO CREATE LEGAL RELATIONS
a. SOCIAL/DOMESTIC AGREEMENTS: there is a presumption that there is no ICLR (Balfour v Balfour)
b. COMMERCIAL AGREEMENTS: there is a presumption that there is ICLR, but hard to rebut (Edwards v Skyways)
3) CONSIDERATION – If it’s a question on offer & acceptance, this wont even be an issue.
Step 3: Is a party making an offer or an ITT?
1) Distinguish between an Offer and ITT.
a. Locate the DEFINITE PROMISE and SPECIFIED TERMS.
2) If it an ADVERT:
a. Adverts are generally regarded as ITT (Partridge v Crittenden)
i. However, an advert of reward is an offer (Williams v Carwardine)
b. UNILATERAL CONTRACT OFFER (Carlill v Carbolic Smoke Ball Co)
i. An advertisement may be a unilateral contract offer.
ii. A unilateral contract: a promise in return for a specified act.
c. An advert can constitute as an offer to ‘the world’ (Carlill v Carbolic Smoke Ball Co)
3) If it’s a TENDER:
a. Generally, an invitation to tender is an ITT, not an offer. (Offeror can choose which bid).
b. TELEXES are offers of a UNILATERAL CONTRACT to sell to the highest bidder, which would be followed by a bilateral contract for the sale
of the shares (Harvela Investments Ltd v Royal Trust Company of Canada Ltd)
, c. Blackpool & Fylde Aero Club Ltd v Blackpool Borough Council
i. An invitation to tender MAY GIVE RISE to an offer.
4) If it’s an AUCTION:
a. RESERVE PRICE: a price agreed between the auctioneer and the seller as being the lowest price which the auctioneer may accept for the
lot (Sale of Goods Act 1979, s57(3)).
i. An auctioneer’s request for bids is an ITT.
ii. The bid is an offer which the auctioneer may accept or reject (Sale of Goods Act 1979, s57(2))
iii. Acceptance is the ‘fall of the hammer’ (s57(2)) and creates a bilateral contract between the bidder and the owner of the goods.
b. ‘WITHOUT RESERVE’: an auction lot that does not have a reserve price.
i. There is an offer of a unilateral contract by the auctioneer (i.e. a promise to accept the highest bid) which is accepted by the
highest bidder.
ii. If the auctioneer refuses to accept the bid, the highest bidder will have a claim in damages against the auctioneer for breach of
contract (Barry v Davies) but will not have a claim against the owner.
Step 4: Has the offer been accepted?
1) Define acceptance: (see above)
2) Distinguish between COUNTEROFFER and REQUEST FOR INFORMATION.
3) ACCEPTANCE ELEMENTS:
a. It must be communicated (Entores v Miles Far East Corp Ltd)
i. Can be communicated by a 3rd party authorised by the offeree (Powell v Lee)
ii. Acceptance by conduct is also possible (Brogden v Metropolitan Railway)
iii. Silence will not normally amount to acceptance (Felthouse v Bindley)
- In Re Selectmove Ltd the Court of Appeal saw no reason in principle why offerees should not bind themselves by silence
(e.g.: If you don’t hear from me, assume I accept your offer).
b. Instantaneous communication effective when and where received (The Brimnes)
4) EXCEPTIONS:
a. The Postal Rule (Adams v Lindsell)
i. Acceptance occurs at the moment of posting.
Points to note:
Answer the question in CHRONOLOGICAL order.
Remember to use IRAC on every individual issue. ISSUE, RULE, APPLICATION, CONCLUSION.
DEFINE important terms.
THERE IS NO RIGHT ANSWER – show that you understand the implications of applying a legal rule and the difficulties of applying it in practice.
Use headings:
o Head each paragraph with the relevant legal issue: Adam v Harry in Negligence.
Language:
o Clear, concise, to the point.
CONCLUSION = CRITICAL EVALUATION + ANALYTICAL.
,UNIT 1 – Offer and Acceptance
Step 1: Identify who is seeking to show a contract exists. (If there is more than one character, deal with SEPERATELY and in CHRONOLOGICAL order)
If it’s in a commercial context STATE that contractual intention will be presumed (Edwards v Skyways) and then state what the real issue is.
Step 2: State the elements needed to form a contract
1) AGREEMENT (Offer & Acceptance)
a. Offer: definite promise to be bound by specified terms capable by being accepted without further negotiation (Treitel)
b. Acceptance: a complete and unqualified acceptance of all the terms of the offer (Treitel)
2) INTENTION TO CREATE LEGAL RELATIONS
a. SOCIAL/DOMESTIC AGREEMENTS: there is a presumption that there is no ICLR (Balfour v Balfour)
b. COMMERCIAL AGREEMENTS: there is a presumption that there is ICLR, but hard to rebut (Edwards v Skyways)
3) CONSIDERATION – If it’s a question on offer & acceptance, this wont even be an issue.
Step 3: Is a party making an offer or an ITT?
1) Distinguish between an Offer and ITT.
a. Locate the DEFINITE PROMISE and SPECIFIED TERMS.
2) If it an ADVERT:
a. Adverts are generally regarded as ITT (Partridge v Crittenden)
i. However, an advert of reward is an offer (Williams v Carwardine)
b. UNILATERAL CONTRACT OFFER (Carlill v Carbolic Smoke Ball Co)
i. An advertisement may be a unilateral contract offer.
ii. A unilateral contract: a promise in return for a specified act.
c. An advert can constitute as an offer to ‘the world’ (Carlill v Carbolic Smoke Ball Co)
3) If it’s a TENDER:
a. Generally, an invitation to tender is an ITT, not an offer. (Offeror can choose which bid).
b. TELEXES are offers of a UNILATERAL CONTRACT to sell to the highest bidder, which would be followed by a bilateral contract for the sale
of the shares (Harvela Investments Ltd v Royal Trust Company of Canada Ltd)
, c. Blackpool & Fylde Aero Club Ltd v Blackpool Borough Council
i. An invitation to tender MAY GIVE RISE to an offer.
4) If it’s an AUCTION:
a. RESERVE PRICE: a price agreed between the auctioneer and the seller as being the lowest price which the auctioneer may accept for the
lot (Sale of Goods Act 1979, s57(3)).
i. An auctioneer’s request for bids is an ITT.
ii. The bid is an offer which the auctioneer may accept or reject (Sale of Goods Act 1979, s57(2))
iii. Acceptance is the ‘fall of the hammer’ (s57(2)) and creates a bilateral contract between the bidder and the owner of the goods.
b. ‘WITHOUT RESERVE’: an auction lot that does not have a reserve price.
i. There is an offer of a unilateral contract by the auctioneer (i.e. a promise to accept the highest bid) which is accepted by the
highest bidder.
ii. If the auctioneer refuses to accept the bid, the highest bidder will have a claim in damages against the auctioneer for breach of
contract (Barry v Davies) but will not have a claim against the owner.
Step 4: Has the offer been accepted?
1) Define acceptance: (see above)
2) Distinguish between COUNTEROFFER and REQUEST FOR INFORMATION.
3) ACCEPTANCE ELEMENTS:
a. It must be communicated (Entores v Miles Far East Corp Ltd)
i. Can be communicated by a 3rd party authorised by the offeree (Powell v Lee)
ii. Acceptance by conduct is also possible (Brogden v Metropolitan Railway)
iii. Silence will not normally amount to acceptance (Felthouse v Bindley)
- In Re Selectmove Ltd the Court of Appeal saw no reason in principle why offerees should not bind themselves by silence
(e.g.: If you don’t hear from me, assume I accept your offer).
b. Instantaneous communication effective when and where received (The Brimnes)
4) EXCEPTIONS:
a. The Postal Rule (Adams v Lindsell)
i. Acceptance occurs at the moment of posting.
