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 1.4.1 Offers and invitations to treat 1.4.2 Pre-contract negotiations 1.4.2.1 Advertisements 1.4.2.2 Displays of goods for sale 1.4.2.3 Mechanised sales: vending machines and websites 1.4.2.4 Running a bus service 1.5 Auctions and tenders 1.5.1 Auction sales 1.5.2 Tenders 1.6 Communication of offers 1.7 Ending an offer 1.7.1 Revocation 1.7.1.1 Communication of a revocation 1.7.1.2 Unilateral contracts and revocation 1.7.2 Lapse of time 1.7.3 Death 1.7.4 Failure of a condition precedent 1.8 Acceptance 1.8.1 The fact of acceptance 1.8.1.1 Qualified acceptance and counter-offers 1.8.1.2 Requests for information compared with counter-offers 1.8.1.3 The battle of the forms 1.8.1.4 Certainty 1.8.2 Communication of acceptance 1.8.2.1 Silence 1.8.2.2 Acceptance by post the postal rule 1.8.2.3 Which rule on acceptance applies to instantaneous and near instantaneous forms of communication? 1.8.3 Contracts concluded by shrink wrap, click wrap or browse wrap 1.8.4 Confusing communications 1.8.5 Cross-offers 1.8.6 Revocation of posted acceptance 1.9 Acceptance: a summary 1.9.1 Contract formation: a summary 1.10 Summary i
Chapter 2: Consideration 2.1 Introduction 2.2 Types of consideration 2.3 Consideration must move from the promisee 2.4 Consideration must be of some value 2.4.1 Adequacy of consideration 2.5 Insufficiency of consideration 2.5.1 Past consideration 2.5.1.1 Evasions of the past consideration rule 2.5.2 Performance of existing duties 2.5.2.1 Public duty imposed by law 2.5.2.2 Where the claimant is under a pre-existing contractual duty to the defendant 2.5.2.3 Where the claimant is under a pre-existing contractual duty to a third party 2.5.2.4 Summary of performance of existing duties 2.5.3 Part payment of a debt 2.5.3.1 The rule at common law 2.5.3.2 Promissory estoppel 2.5.3.3 Compositions with creditors 2.5.3.4 Payment by third parties 2.6 Summary Chapter 3: Intention to Create Legal Relations 3.1 Introduction 3.2 Social and domestic arrangements 3.2.1 Husband and wife 3.2.2 Children and parents 3.2.3 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 4.2.1 Oral contracts 4.2.2 Written contracts: the parol evidence rule 4.2.3 Incorporation of statements as terms of a contract 4.2.3.1 Timing 4.2.3.2 Importance of the terms 4.2.3.3 Reduction of terms to writing 4.2.3.4 Special knowledge/skills 4.3 Interpretation 4.4 Terms implied by the courts 4.4.1 Terms implied as fact/the officious bystander test 4.4.2 Terms implied by law 4.5 Terms implied by statute ii
4.5.1 The Sale of Goods Act 1979 and Supply of Goods and Services Act 1982 4.5.1.1 Implied terms as to right to sell: commercial sales under s12 Sale of Goods Act 1979 4.5.1.2 The goods must correspond with their description: commercial sales under s13 Sale of Goods Act 1979 4.5.1.3 The quality obligations for commercial transactions under ss14(2) and 14(3) Sale of Goods Act 1979 4.5.1.4 Sale by sample: commercial transactions (s15 Sale of Goods Act 1979) 4.5.2 The Consumer Rights Act 2015 4.5.2.1 Implied terms, the trader s right to supply the goods: consumer sales under s17 Consumer Rights Act 2015 4.5.2.2 The goods to be as described: consumer sales under s11 Consumer Rights Act 2015 4.5.2.3 Satisfactory quality and fitness for purpose: consumer sales under ss9 10 Consumer Rights Act 2015 4.5.2.4 Sale by sample: commercial transactions (ss13 14 Consumer Rights Act 2015) 4.5.2.5 Digital content (ss33 47 Consumer Rights Act 2015) 4.5.3 Supply of services 4.5.4 Consumer rights remedies 4.5.5 Excluding the statutory implied terms from contracts 4.6 Terms implied by custom 4.7 The classification of terms conditions and warranties 4.7.1 Conditions 4.7.2 Warranties 4.7.3 Innominate or intermediate terms 4.7.4 How to classify terms 4.8 Summary Chapter 5: Exemption Clauses and Unfair Terms 5.1 Introduction 5.2 A term of the contract? 5.2.1 Signature 5.2.2 Notice 5.2.2.1 The nature of the document 5.2.2.2 Degree of notice 5.2.2.3 Onerousness of the clause 5.2.2.4 Time the notice was given 5.2.3 Previous course of dealing 5.3 Construction of exemption clauses 5.3.1 The contra proferentem rule 5.3.2 Negligence 5.3.3 Seriousness of the breach 5.3.4 Common law reasons for failure 5.3.4.1 Misrepresentation 5.3.4.2 Third parties 5.4 Statutory controls: Unfair Contract Terms Act 1977 5.4.1 Scope of the Act 5.4.1.1 Negligence: definition 5.4.1.2 Terms made totally ineffective 5.4.1.3 Terms subject to the test of reasonableness 5.4.1.4 The requirement of reasonableness iii
5.4.1.5 Secondary contracts 5.4.1.6 s13 clauses 5.4.1.7 Summary of the Unfair Contract Terms Act 1977 5.5 Unfair terms under the Consumer Rights Act 2015 5.6 Summary Chapter 6: Misrepresentation 6.1 Introduction 6.2 Proving misrepresentation 6.2.1 The statement must be false 6.2.2 There must be a statement silence cannot constitute a misrepresentation 6.2.2.1 Half-truths 6.2.2.2 Change of circumstances 6.2.2.3 Contracts uberrimae fidei (of the utmost good faith) 6.2.2.4 Fiduciary relationships 6.2.3 The misrepresentation must be one of fact 6.2.3.1 Statements of opinion 6.2.3.2 Statements of intention 6.2.4 The misrepresentation must have induced the contract 6.3 Liability for third party statements 6.4 The types of misrepresentation 6.4.1 Fraudulent misrepresentation 6.4.2 Non-fraudulent ( negligent ) misrepresentation under the Misrepresentation Act 1967 6.4.3 Innocent misrepresentation 6.5 Remedies for misrepresentation 6.5.1 Rescission 6.5.1.1 How rescission works 6.5.1.2 Loss of right to rescind 6.5.1.3 Indemnity 6.5.1.4 s2(2) Misrepresentation Act 1967 6.5.1.5 Example of rescission 6.5.2 Damages 6.5.2.1 Tortious nature of damages in misrepresentation 6.5.2.2 Fraudulent misrepresentation 6.5.2.3 s2(1) Misrepresentation Act 1967 6.5.2.4 Innocent misrepresentation 6.6 Exclusion of liability for misrepresentations 6.7 Summary Chapter 7: Duress and Undue Influence 7.1 Introduction 7.2 Duress at common law 7.2.1 The development of the doctrine 7.2.2 Economic duress 7.3 The effects of duress 7.4 The equitable notion of undue influence 7.4.1 Actual undue influence 7.4.2 Undue influence where a relationship of trust and confidence exists 7.4.3 Undue influence exercised by a third party iv
7.4.4 The effects of undue influence and bars to relief 7.4.4.1 Restoring the parties to their original position (restitutio in integrum) is impossible 7.4.4.2 Affirmation 7.4.4.3 Delay 7.4.4.4 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 8.6.1 Criminal liability 8.6.2 Civil liability 8.7 Contracts contrary to public policy 8.7.1 Contracts tending to lead to corruption in public life 8.7.2 Contracts promoting sexual immorality 8.7.3 Contracts prejudicial to the administration of justice 8.7.4 Trading with the enemy 8.7.5 Contracts relating to matrimonial matters 8.7.5.1 Contracts for future separation 8.7.5.2 Contracts in restraint of marriage 8.7.5.3 Marriage brokerage contracts 8.7.6 Contracts to oust the jurisdiction of the courts 8.8 Contracts restricting personal liberty 8.9 Contracts in restraint of trade 8.9.1 The test of reasonableness 8.9.1.1 Reasonableness as between the parties 8.9.1.2 Reasonableness in respect of the public interest 8.9.1.3 Other factors potentially affecting reasonableness 8.9.2 Different types of covenant 8.9.2.1 Covenants between employers and employees 8.9.2.2 Sale of a business 8.9.2.3 Solus agreements and restrictive trading agreements 8.9.2.4 Other agreements 8.10 The effects of illegality 8.10.1 The intention of the parties 8.10.1.1 Guilty parties 8.10.1.2 Innocent parties 8.10.2 Contracts unlawful per se 8.10.3 Recovery of money or property 8.10.3.1 Withdrawal from the illegal contract 8.10.3.2 The statutory authorisation of restitution 8.10.3.3 Parties not in pari delicto (equally wrong) 8.10.3.4 Restitution without reliance on the illegal contract v
8.11 Severance 8.11.1 The blue pencil test 8.11.2 The illegal part must not be the main consideration 8.11.3 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 9.3.1 Contracts (Rights of Third Parties) Act 1999 9.3.2 Collateral contracts 9.3.3 Statutes 9.3.3.1 Married Women s Property Act 1882 9.3.3.2 Road Traffic Act 1988 9.3.3.3 Bills of Exchange Act 1882 9.3.3.4 Companies Act 2006 9.3.3.5 Third Parties (Rights against Insurers) Act 2010 9.3.4 Equity 9.3.5 Damages on behalf of another 9.3.6 The law of agency 9.3.7 s56 Law of Property Act 1925 9.4 Exceptions: third party obligations 9.4.1 Obligations concerning land 9.4.1.1 Freehold land 9.4.1.2 Leasehold land 9.4.2 Obligations concerning personal property (chattels) 9.4.3 Privity and exemption/exclusion clauses 9.5 Summary Chapter 10: Discharge of Contract 10.1 Introduction 10.2 Discharge by performance: terms of the contract 10.2.1 Severable contracts or obligations 10.2.2 Voluntary acceptance of partial performance and partial payment a quantum meruit 10.2.3 Substantial performance 10.2.4 Wrongful prevention of performance by the promisee 10.2.5 Tender of performance 10.2.6 Time of performance 10.3 Discharge by agreement 10.3.1 Bilateral discharge 10.3.2 Accord and satisfaction 10.3.3 Rescission 10.3.4 Variation 10.3.5 Waivers 10.3.6 Provision in the contract for discharge 10.3.7 Unilateral discharge 10.4 Discharge by breach 10.4.1 Repudiation contrasted with affirmation 10.4.2 Anticipatory breach 10.5 Discharge by frustration 10.5.1 The development of the doctrine vi
10.5.2 Limitations on the scope of the doctrine 10.5.2.1 Unforseen by the parties 10.5.2.2 Not due to the fault of either party 10.5.2.3 Renders further performance impossible, illegal or makes it radically different from that contemplated by the parties at the time of the contract 10.5.3 Examples of possible frustrating events 10.5.3.1 Subject matter destroyed 10.5.3.2 Subject matter unavailable 10.5.3.3 Impossibility of stipulated method of performance 10.5.3.4 Failure of a specific event 10.5.3.5 Supervening illegality 10.5.3.6 Leases 10.5.3.7 Delay 10.5.4 The effects of frustration at common law 10.5.5 The Law Reform (Frustrated Contracts) Act 1943 10.5.5.1 Right to recover money paid 10.5.5.2 Performance conferring a valuable benefit 10.5.5.3 Other considerations in relation to the Law Reform (Frustrated Contracts) Act 1943 10.5.6 Summary of the effects of frustration 10.6 Summary Chapter 11: Damages for Breach of Contract 11.1 Introduction 11.2 Causation 11.3 Aim of damages in contract law 11.4 Damages: remoteness of damage 11.5 Quantum of damages: general principles 11.5.1 Quantifying a lost bargain 11.5.1.1 Expectation Loss 11.5.1.2 Reliance loss 11.5.1.3 Restitutionary damages 11.5.1.4 Recovery of the price in restitution 11.5.2 Time for assessment of loss 11.5.3 The market value rules 11.5.3.1 Market value: seller at fault 11.5.3.2 Market value: buyer at fault 11.5.4 The effect of taxation 11.5.5 Speculative damages 11.6 Damages for non-pecuniary losses and the consumer surplus 11.7 Restitutionary damages 11.8 Mitigation of loss 11.9 Contributory negligence 11.10 Liquidated damages and penalties 11.11 Summary Chapter 12: Other Remedies for Breach of Contract 12.1 Introduction 12.2 Deposits and part-payments 12.3 Equitable remedies 12.3.1 Specific performance vii
12.3.1.1 Effect of a decree of specific performance on other remedies 12.3.1.2 Mutuality 12.3.1.3 Specific performance in particular situations 12.3.1.4 Defences to specific performance 12.3.2 Injunctions 12.3.2.1 Restrictions 12.4 Damages in equity: Chancery Amendment Act 1858 (Lord Cairns Act) 12.4.1 Measure of damages under s50 Senior Courts Act 1981 12.5 Limitation of actions: basic rules 12.5.1 Fraud and mistake 12.5.2 Disabilities and minors 12.6 Summary Answers to Self-assessment Questions Index viii
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