Contents. Table of Statutes. Table of Secondary Legislation. Table of Cases. The Agreement to Contract
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1 Contents Table of Statutes Table of Secondary Legislation Table of Cases Chapter 1: The Agreement to Contract 1.1 Introduction 1.2 Elements required for a valid simple contract 1.3 The phenomenon of agreement 1.4 Offer Offers and invitations to treat Pre-contract negotiations Advertisements Displays of goods for sale Mechanised sales: vending machines and websites Auction sales Running a bus service 1.5 Communication of offers 1.6 Ending an offer Revocation Communication of a revocation Unilateral contracts and revocation Lapse of time Death Failure of a condition precedent 1.7 Acceptance The fact of acceptance Qualified acceptance and counter-offers Requests for information compared with counter-offers The battle of the forms Certainty Tenders 1.8 Communication of acceptance Silence Acceptance by post the postal rule Which rule on acceptance applies to instantaneous and near instantaneous forms of communication? Contracts concluded by shrink wrap, click wrap or browse wrap Confusing communications Cross-offers Revocation of posted acceptance 1.9 Acceptance: a summary Contract formation: a summary 1.10 Summary Chapter 2: Consideration 2.1 Introduction 2.2 Types of consideration Exceptions 2.3 Consideration must move from the promisee i
2 2.4 Consideration must be of some value Adequacy of consideration Insufficiency of consideration Performance of existing duties Part-payment of debt 2.5 Summary Chapter 3: Intention to Create Legal Relations 3.1 Introduction 3.2 Social and domestic arrangements Husband and wife Children and parents Other social arrangements 3.3 Commercial agreements 3.4 Cases in which the existence of an intention to create legal relations is denied by the courts or by statute 3.5 Letters of comfort 3.6 Capacity to contract 3.7 Summary Chapter 4: Terms of a Contract 4.1 Introduction 4.2 Express terms Oral contracts Written contracts: the parol evidence rule Incorporation of statements as terms of a contract Timing Importance of the terms Reduction of terms to writing Special knowledge/skills 4.3 Terms implied by the courts Terms implied as fact/the officious bystander test Terms implied by law 4.4 Terms implied by statute Implied terms as to right to sell: commercial sales under s12 SGA Implied terms, the trader s right to supply the goods: consumer sales under s17 CRA The goods must correspond with their description: commercial sales under s13 SGA What is a sale by description? Were the goods sold by reference to their description? The goods to be as described: consumer sales under s11 CRA The quality obligations for commercial transactions under ss14(2) and 14(3) SGA Satisfactory quality: commercial transactions under s14(2) SGA Quality and fitness for purpose: commercial transactions under s14(3) SGA Satisfactory quality: consumer sales under s9 CRA Sale by sample: commercial transactions (s15 SGA 1979) ii
3 Sale by sample: consumer transactions (ss13-14 CRA 2015) Excluding the implied terms from contracts Supply of services 4.5 Terms implied by custom 4.6 The classification of terms conditions and warranties Conditions Warranties Innominate or intermediate terms 4.7 Summary Chapter 5: Exemption Clauses and Unfair Terms 5.1 Introduction 5.2 A term of the contract? Signature Notice The nature of the document Degree of notice Time the notice was given Previous course of dealing 5.3 Construction of exemption clauses The contra proferentem rule Negligence Seriousness of the breach Common law reasons for failure Misrepresentation Overriding undertaking Third parties Collateral contracts 5.4 Statutory controls: Unfair Contract Terms Act Scope of the Act Negligence: definition Terms made totally ineffective Terms subject to the test of reasonableness The requirement of reasonableness Secondary contracts s13 clauses 5.5 Unfair terms under the Consumer Rights Act Summary Chapter 6: Misrepresentation 6.1 Introduction 6.2 The misrepresentation must be one of fact (or law?) Statements of opinion Statements of intention The effect of silence Half-truths Change of circumstances Contracts uberrimae fidei (of the utmost good faith) Fiduciary relationships 6.3 The misrepresentation must have induced the contract 6.4 Liability for third party statements 6.5 The types of misrepresentation iii
4 6.5.1 Fraudulent misrepresentation Negligent misrepresentation under the Misrepresentation Act Innocent misrepresentation 6.6 Remedies for misrepresentation Affirmation Rescission: general principles Loss of right to rescind Damages Fraudulent misrepresentation s2(1) Misrepresentation Act Innocent misrepresentation Damages in lieu of rescission 6.7 Exclusion of liability for misrepresentations 6.8 Summary Chapter 7: Duress and Undue Influence 7.1 Introduction 7.2 Duress at common law The development of the doctrine Economic duress 7.3 The effects of duress 7.4 The equitable notion of undue influence Actual undue influence Undue influence where a relationship of trust and confidence exists Undue influence exercised by a third party The effects of undue influence and bars to relief Restoring the parties to their original position (restitutio in integrum) is impossible Affirmation Delay Third party rights 7.5 Inequality of bargaining power and unconscionability 7.6 Statutory protection afforded to consumers 7.7 Summary Chapter 8: Illegality 8.1 Introduction 8.2 Contracts to commit a crime 8.3 Contracts to commit a civil wrong 8.4 Subject-matter ordered for an unlawful purpose 8.5 Unlawful manner of performance 8.6 Contracts to indemnify against liability for unlawful acts Criminal liability Civil liability 8.7 Contracts contrary to public policy Contracts tending to lead to corruption in public life Contracts promoting sexual immorality Contracts prejudicial to the administration of justice Trading with the enemy Contracts relating to matrimonial matters iv
5 Contracts for future separation Contracts in restraint of marriage Marriage brokerage contracts Contracts to oust the jurisdiction of the courts 8.8 Contracts restricting personal liberty 8.9 Contracts in restraint of trade The test of reasonableness Reasonableness as between the parties Reasonableness in respect of the public interest Other factors potentially affecting reasonableness Different types of covenant Covenants between employers and employees Sale of a business Solus agreements and restrictive trading agreements Other agreements 8.10 The effects of illegality The intention of the parties Guilty parties Innocent parties Contracts unlawful per se Recovery of money or property Withdrawal from the illegal contract The statutory authorisation of restitution Parties not in pari delicto (equally wrong) Restitution without reliance on the illegal contract 8.11 Severance The blue pencil test The illegal part must not be the main consideration The severance must not alter the agreement 8.12 Summary Chapter 9: Privity of Contract 9.1 Introduction 9.2 The general rule 9.3 Exceptions: third party rights Contracts (Rights of Third Parties) Act Collateral contracts Statutes Married Women s Property Act Road Traffic Act Bills of Exchange Act Companies Act Third Parties (Rights against Insurers) Act Equity Damages on behalf of another The law of agency s56 Law of Property Act Exceptions: third party obligations Obligations concerning land Freehold land Leasehold land Obligations concerning personal property (chattels) Privity and exemption/exclusion clauses 9.5 Summary v
6 Chapter 10: Discharge of Contract 10.1 Introduction 10.2 Discharge by performance: terms of the contract Severable contracts or obligations Voluntary acceptance of partial performance and partial payment a quantum meruit Substantial performance Prevention of performance by the promisee Tender of performance Time of performance 10.3 Discharge by agreement Bilateral discharge Accord and satisfaction Rescission Variation Waivers Provision in the contract for discharge Unilateral discharge 10.4 Discharge by breach 10.5 Discharge by frustration The development of the doctrine Examples of possible frustrating events Subject-matter destroyed Subject-matter unavailable Impossibility of stipulated method of performance Failure of a specific event Supervening illegality Leases Delay Limitations on the scope of the doctrine Express provisions Self-induced frustration Loss of profits/increase in expenses The effects of frustration at common law The Law Reform (Frustrated Contracts) Act Right to recover money paid Performance conferring a valuable benefit Other considerations in relation to LR(FC)A Summary Chapter 11: Remedies for Breach of Contract 11.1 Introduction 11.2 Basis for an award for damages 11.3 Damages: remoteness of damage 11.4 Causation 11.5 Quantum of damages: general principles Time for assessment of loss The market value rules The effect of taxation Speculative damages 11.6 Damages for non-pecuniary losses and the consumer surplus 11.7 Mitigation of loss 11.8 Contributory negligence vi
7 11.9 Liquidated damages and penalties Deposits and part-payments Equitable remedies Specific performance Effect of a decree of specific performance on other remedies Mutuality Specific performance in particular situations Defences to specific performance Injunctions Restrictions Damages in equity: Chancery Amendment Act 1858 (Lord Cairns Act) Measure of damages under s50 Senior Courts Act Limitation of actions: basic rules Fraud and mistake Disabilities and minors Summary Answers to Self-assessment Questions Index vii
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