Contract revision
Monday, May 19, 2025 1:40 PM
✅ MISREPRESENTATION 📌 Discharge by Performance
🔹 Definition: ✅ Elements:
1. Performance must be complete
A false statement of fact or law made by one party that induces
📚 Cutter v Powell – Part performance is insufficient unless
another to enter into a contract.
accepted.
🔸 Elements: 2. Divisible contracts may allow part performance
1. False statement of fact or law 📚 Ritchie v Atkinson – If contract is divisible, payment may be due
• Must not be opinion or future intention unless dishonest. for parts completed.
• 📌 Bisset v Wilkinson [1927] — An honest opinion (about sheep 3. Substantial performance may suffice
capacity) is not misrepresentation. 📚 Hoenig v Isaacs – Substantial performance = payment minus
2. Made by a party to the contract defects.
• It must come from the other contracting party, not a third party. 4. Acceptance of partial performance
• 📌 Peek v Gurney [1873] — Misrepresentation in a prospectus, not 📚 Sumpter v Hedges – If one party accepts partial performance
by a direct party = no claim. voluntarily, payment may be due.
3. Induces the other party to enter the contract
• Must be a real and material influence.
• 📌 Attwood v Small [1838] — Buyer relied on their own survey, not 🌪️ Discharge by Frustration
on the seller’s statement = no inducement. ✅ Elements:
4. Statement is untrue 5. Unforeseen event occurs after contract formation
• If the statement becomes untrue before the contract and is not 📚 Taylor v Caldwell – Destruction of subject matter = frustration.
corrected = misrepresentation. 6. The event makes performance impossible, illegal or radically
• 📌 With v O’Flanagan [1936] — Change of circumstances must be different
disclosed. • Impossible: Robinson v Davison – Pianist illness made performance
impossible.
🔸 Types of Misrepresentation: • Illegal: Denny, Mott & Dickinson v James Fraser – Law change made
• Fraudulent → knowingly or recklessly false (Derry v Peek) contract illegal.
• Negligent → carelessly false (under Misrepresentation Act 1967, • Radically different: Krell v Henry – Coronation cancelled = no purpose
s2(1)) for renting room.
• Innocent → honestly believed to be true 7. Self-induced frustration is not allowed
📚 Maritime National Fish v Ocean Trawlers – Can’t claim frustration
🔸 Key Remedies: if your own actions caused the issue.
• Rescission (all types) 8. Increased difficulty or expense is not frustration
• Damages (fraudulent & negligent only, not innocent unless under 📚 Davis Contractors v Fareham UDC – Mere inconvenience ≠
Misrep Act 1967 s2(2)) frustration.
✅ MISTAKE 💥 Discharge by Breach
🔹 Definition: ✅ Elements:
A misunderstanding or error relating to a fundamental aspect of the 9. Actual breach – A party fails to perform at time of performance.
contract. 📚 Poussard v Spiers – Breach of condition → right to terminate +
damages.
🔸 Types & Elements: 10. Anticipatory breach – A party indicates in advance they won’t
5. Common Mistake (Both parties share the same mistaken belief) perform.
• 📌 Bell v Lever Bros [1932] — Mistake must be fundamental, not just 📚 Hochster v De la Tour – Innocent party may sue immediately.
as to quality or value. 11. Breach of condition vs warranty
• 📌 Couturier v Hastie [1856] — Subject matter didn’t exist = contract • Condition: Goes to the root of the contract → terminate + damages
void. • Warranty: Minor term → damages only
6. Mutual Mistake (Both parties misunderstand each other) 📚 Bettini v Gye – Breach of warranty → cannot terminate.
• 📌 Raffles v Wichelhaus [1864] — Two ships named Peerless → no 12. Innocent party must elect to accept or affirm
consensus ad idem. 📚 White & Carter v McGregor – Can affirm contract and insist on
7. Unilateral Mistake (Only one party is mistaken, and the other knows performance.
or ought to know)
• 📌 Smith v Hughes [1871] — No obligation to correct the other’s
mistake if you haven’t misled.
• 📌 Hartog v Colin & Shields [1939] — One party took advantage of a
pricing error = contract void. 🔹 Compensatory Damages
📌 Key Concepts:
🔸 Key Doctrine: • Purpose: To compensate the claimant for losses due to breach of contract,
• Mistake as to identity (especially in fraud cases) not to punish.
• 📌 Cundy v Lindsay — Contract void where the identity of a written-
• Types of Losses:
party was mistaken. • Financial Loss:
• 📌 Shogun Finance v Hudson [2003] — Rogue used false identity → • Expectation Loss (benefit of the bargain)
contract void. ▸ Robinson v Harman (1848): The injured party should be placed in the
position as if the contract had been performed.
🔸 Effect: ▸ Measuring:
• Renders contract void (not voidable) → No legal contract ever • Cost of cure or diminution in value
existed. • Ruxley Electronics v Forsyth (1996): Cost of cure may not be awarded if
disproportionate to actual loss.
Monday, May 19, 2025 1:40 PM
✅ MISREPRESENTATION 📌 Discharge by Performance
🔹 Definition: ✅ Elements:
1. Performance must be complete
A false statement of fact or law made by one party that induces
📚 Cutter v Powell – Part performance is insufficient unless
another to enter into a contract.
accepted.
🔸 Elements: 2. Divisible contracts may allow part performance
1. False statement of fact or law 📚 Ritchie v Atkinson – If contract is divisible, payment may be due
• Must not be opinion or future intention unless dishonest. for parts completed.
• 📌 Bisset v Wilkinson [1927] — An honest opinion (about sheep 3. Substantial performance may suffice
capacity) is not misrepresentation. 📚 Hoenig v Isaacs – Substantial performance = payment minus
2. Made by a party to the contract defects.
• It must come from the other contracting party, not a third party. 4. Acceptance of partial performance
• 📌 Peek v Gurney [1873] — Misrepresentation in a prospectus, not 📚 Sumpter v Hedges – If one party accepts partial performance
by a direct party = no claim. voluntarily, payment may be due.
3. Induces the other party to enter the contract
• Must be a real and material influence.
• 📌 Attwood v Small [1838] — Buyer relied on their own survey, not 🌪️ Discharge by Frustration
on the seller’s statement = no inducement. ✅ Elements:
4. Statement is untrue 5. Unforeseen event occurs after contract formation
• If the statement becomes untrue before the contract and is not 📚 Taylor v Caldwell – Destruction of subject matter = frustration.
corrected = misrepresentation. 6. The event makes performance impossible, illegal or radically
• 📌 With v O’Flanagan [1936] — Change of circumstances must be different
disclosed. • Impossible: Robinson v Davison – Pianist illness made performance
impossible.
🔸 Types of Misrepresentation: • Illegal: Denny, Mott & Dickinson v James Fraser – Law change made
• Fraudulent → knowingly or recklessly false (Derry v Peek) contract illegal.
• Negligent → carelessly false (under Misrepresentation Act 1967, • Radically different: Krell v Henry – Coronation cancelled = no purpose
s2(1)) for renting room.
• Innocent → honestly believed to be true 7. Self-induced frustration is not allowed
📚 Maritime National Fish v Ocean Trawlers – Can’t claim frustration
🔸 Key Remedies: if your own actions caused the issue.
• Rescission (all types) 8. Increased difficulty or expense is not frustration
• Damages (fraudulent & negligent only, not innocent unless under 📚 Davis Contractors v Fareham UDC – Mere inconvenience ≠
Misrep Act 1967 s2(2)) frustration.
✅ MISTAKE 💥 Discharge by Breach
🔹 Definition: ✅ Elements:
A misunderstanding or error relating to a fundamental aspect of the 9. Actual breach – A party fails to perform at time of performance.
contract. 📚 Poussard v Spiers – Breach of condition → right to terminate +
damages.
🔸 Types & Elements: 10. Anticipatory breach – A party indicates in advance they won’t
5. Common Mistake (Both parties share the same mistaken belief) perform.
• 📌 Bell v Lever Bros [1932] — Mistake must be fundamental, not just 📚 Hochster v De la Tour – Innocent party may sue immediately.
as to quality or value. 11. Breach of condition vs warranty
• 📌 Couturier v Hastie [1856] — Subject matter didn’t exist = contract • Condition: Goes to the root of the contract → terminate + damages
void. • Warranty: Minor term → damages only
6. Mutual Mistake (Both parties misunderstand each other) 📚 Bettini v Gye – Breach of warranty → cannot terminate.
• 📌 Raffles v Wichelhaus [1864] — Two ships named Peerless → no 12. Innocent party must elect to accept or affirm
consensus ad idem. 📚 White & Carter v McGregor – Can affirm contract and insist on
7. Unilateral Mistake (Only one party is mistaken, and the other knows performance.
or ought to know)
• 📌 Smith v Hughes [1871] — No obligation to correct the other’s
mistake if you haven’t misled.
• 📌 Hartog v Colin & Shields [1939] — One party took advantage of a
pricing error = contract void. 🔹 Compensatory Damages
📌 Key Concepts:
🔸 Key Doctrine: • Purpose: To compensate the claimant for losses due to breach of contract,
• Mistake as to identity (especially in fraud cases) not to punish.
• 📌 Cundy v Lindsay — Contract void where the identity of a written-
• Types of Losses:
party was mistaken. • Financial Loss:
• 📌 Shogun Finance v Hudson [2003] — Rogue used false identity → • Expectation Loss (benefit of the bargain)
contract void. ▸ Robinson v Harman (1848): The injured party should be placed in the
position as if the contract had been performed.
🔸 Effect: ▸ Measuring:
• Renders contract void (not voidable) → No legal contract ever • Cost of cure or diminution in value
existed. • Ruxley Electronics v Forsyth (1996): Cost of cure may not be awarded if
disproportionate to actual loss.
