Agreement Problems

Scammell & Nephew Ltd v Ouston (1941) (HL) - Agreements to purchase a van on hire purchase terms but the details of these hire purchase terms had not been agreed. It was held that there were so many interpretations of hire purchase terms that the courts could not imply terms based on commercial practice and the contract was therefore void for uncertainty of terms. 

Hillas & Co. Ltd v Arcos Ltd (1932) (HL) - the plaintiff's agreed to buy '22,000 standards of softwood goods of fair specification' for 1930 and there was a further option for '100,000 standards' for 1931. It was held that the agreement was binding as it had been performed in 1930 and there was an accepted understanding of the meaning of these words in commercial practice. 

Nicolene Ltd v Simmonds (1953) (CA) - the agreement referred to acceptance as being on 'the usual conditions of acceptance'. In fact there were no such usual conditions and, when the defendant failed to deliver, the plaintiffs brought an action for breach of contract. It was held that the clause in question was severed so that the rest of the agreement was enforceable. 

Walford v Miles (1992) (HL) - the defendants were negotiating for the sale of a company to the plaintiffs. They had entered into an agreement whereby, in return for the provision of a comfort letter from the plaintiff's bank (indicating that loan facilities had been granted to cover the price of £2m), the defendants agreed to terminate any negotiations with third parties, agreed not to entertain offers from any other prospective purchasers, and agreed to deal exclusively with the plaintiff's (a lockout agreement). Although the plaintiff's complied with their side of the agreement, the defendants withdrew from the negotiations and decided to sell to a third party. The plaintiff's claimed damages for breach of this lockout agreement. It was held that it was only an agreement to negotiate and was therefore unenforceable for uncertainty. Although there was consideration for the lockout, it extended for an indefinite period. The House of Lords rejected the argument that there was an implied duty placed on the party who had agreed to the lockout to negotiate in good faith with the party to that lockout for a reasonable period of time. Their Lordships considered that such an implied duty could not be reconciled with the adversarial nature of contractual negotiations. 

May & Butcher Ltd v R (1934) (HL) - the contract provided for the price to be agreed upon by the parties from time to time. There was no party agreement. It was held that the contract contained a mechanism for fixing the price but this had failed. Therefore the argument that the agreement should be construed as an agreement to sell at a fair and reasonable price was rejected. 

Foley v Classique Coaches Ltd (1934) (CA) - there was an agreement to purchase petrol at a price to be agreed by the parties from time to time. The defendants had purchased…