Contract Law

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Define a contract
A contract is an agreement giving rise to
obligations which can be enforced or recognised
by law; unilateral and bilateral contracts.
1 of 21
Explain the legal requirements for the
formation of an enforceable contract
Offer and acceptance (agreement), intention,
consideration.
2 of 21
Explain the factual indicators of the
existence of agreement
Offer and acceptance.
3 of 21
Explain who can enforce a contract
Doctrine of privity: only the parties to a contract
can sue or be sued on it, e.g.: Tweddle v
Atkinson (1861) and Dunlop v Selfridge (1915).
The exceptions in the Contracts (Rights of Third
Parties) Act 1999 (i.e. ss1(1)(a) and (b);
s.1(2))
4 of 21
Describe what constitutes a valid
offer
An offer is an expression of willingness to
contract on certain terms with the intention it
shall become binding upon acceptance. It may
be made orally, in writing or by conduct.
5 of 21
Define an invitation to treat
An invitation for offers or to open negotiations e.g advertisements
(Gibson v Manchester City Council)
6 of 21
What is the main difference between an offer and an invitation to treat
An offer potentially gives rise to liability if accepted
7 of 21
Explain the requirements of the communication of an offer
The offer must be communicated to the offeree (Taylor v Laird)
8 of 21
Describe how an offer is terminated
Acceptance
Rejection (i.e. counter offer)
Lapse of time
Withdrawal (revocation)
9 of 21
Explain the nature and effect of a counter offer
Destroys the original offer
Hyde v Wrench
10 of 21
Explain how, and in what
circumstance, the lapse of time may
terminate an offer
Offer for a limited period expires at the end of
the period; if no period is stated offer lapses
after a reasonable time. Court decides what is
reasonable on all the facts of the case:
Ramsgate Victoria Hotel v Montefiore (1866).
11 of 21
Explain the nature of, and
requirements for, withdrawal
(revocation) of offer
Withdrawal of offer by offeror must be done
before acceptance by the offeree: Payne v Cave
(1789); must be communicated: Byrne v van
Tienhoven (1880), even if by a reliable thirdparty: Dickinson v Dodds (1876). Withdrawal of
an offer to enter a unilat
12 of 21
Describe a valid acceptance of an
offer
The final and unqualified assent to all the terms
of an offer. The acceptance must ‘mirror’ the
offer. Acceptance of the offer amounts to
agreement - consensus ad idem. Acceptance of
an offer to enter into a unilateral contract
13 of 21
Is silence considered acceptance?
No, the offeror cannot stipulate that silence is valid
acceptance: Felthouse v Bindley (1862)
14 of 21
Explain the postal rule
Adams v Lindsell
Acceptance occurs at the time the letter was properly posted
15 of 21
Define consideration
A benefit to the
promisor or a detriment to the promisee: Currie
v Misa (1875); or the price for which the other
party’s promise is bought: Dunlop v Selfridge
(1915). The types of consideration: executed and executory
16 of 21
Explain the rules governing what
amounts to valid consideration
Consideration must move from the promisee:
Dunlop v Selfridge but not necessarily to the
promisor – relevance of doctrine of privity of
contract: Tweddle v Atkinson (1861) -
Contracts (Rights of Third Parties) Act 1999;
17 of 21
Explain the rule on past consideration and its exception
Past consideration is not good consideration:
Re McArdle (1951). Exception where act done
at request of promisor; understood that
payment would be made; and payment This specification is for 2021 examinations
otherwise legally recoverable, e.g. Lamplei
18 of 21
Name two of the requirements for valid consideration
Consideration must be sufficient: Thomas v
Thomas (1842).
• Consideration need not be adequate:
Chappell v Nestlé (1960).
19 of 21
State the rules relating to performance of an existing duty
Rules relating to performance of an existing duty:
i) Performance of an existing public duty is not
good consideration: Collins v Godefroy
(1831) unless promise goes beyond what
they are bound to do: Harris v Sheffield
United FC Ltd (1988).
ii) Perform
20 of 21
Explain how performance of an existing duty may be good consideration.
However, the performance
of an existing duty may be good
consideration for a promise of extra payment
if the promisor derives a practical benefit
from its performance
: Williams v Roffey Bros
21 of 21

Other cards in this set

Card 2

Front

Explain the legal requirements for the
formation of an enforceable contract

Back

Offer and acceptance (agreement), intention,
consideration.

Card 3

Front

Explain the factual indicators of the
existence of agreement

Back

Preview of the front of card 3

Card 4

Front

Explain who can enforce a contract

Back

Preview of the front of card 4

Card 5

Front

Describe what constitutes a valid
offer

Back

Preview of the front of card 5
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