0802MP 2 Contract

Module Planner LLB (Hons)
Contract Law
Holborn College Ltd 2008 All rights reserved. No part of this publication may be reproduced or transmitted in any form or by any means, electronic, mechanical, photocopying, recording or otherwise, or stored in any retrieval system of any nature without either the written permission of the copyright holder, application for which should be made to Holborn College Ltd, Woolwich Road, Charlton, London SE7 8LN, or a licence permitting restricted copying in the United Kingdom issued by the Copyright Licensing Agency. Any person who infringes the above in relation to this publication may be liable to criminal prosecution and civil claims for damages. The College reserves the right to modify any information contained herein. Produced in January 2008.
HOLBORN COLLEGE
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CONTRACT LAW
Module Title: Pre-requisites: Level: Total Learning Hours: Credits: Teaching Method: Law of Contract None Level 1
300 hours 30 Lectures and seminars (in term time). The teaching element of the module will be delivered by means of one one-and-a-half hour lecture and a one one- anda-half hour seminar each week. The lecture will set out the general rules and principles concerning each topic, perhaps making particular reference to any especially problematic areas. Seminars will both develop and test students understanding of each topic. As well as their general research and reading, students will be expected to prepare research and reading, students will be expected to prepare specific discursive and / or problem solving questions for discussion in class. Yes
Core Module: Aims
To fulfil the Law Society and the Bar Councils requirements for the Foundation in Contract Law element of a Qualifying Law Degree; To acquire a basic understanding of the basic principles of the English law of Contract, including formation, privity, vitiating factors, terms, discharge and remedies; To be stimulated into acquiring an enquiring and critical appreciation of the law; To acquire a willingness to accept responsibility for his or her own learning and to learn independently using initiative and self discipline; To develop a range of graduate skills including transferable intellectual skills and key skills; To apply their knowledge and understanding to unseen questions under examination conditions; To research individually and report back upon matters of contract law;
UNDERGRADUATE PROGRAMME
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Content The module considers the formation of a contract including offer, acceptance, consideration & privity of contract. It goes on to consider the contents of the contract including conditions & warranties, express and implied terms, standard form contracts and exclusion clauses. The module then considers vitiating factors such as misrepresentation, mistake, undue influence, duress, unconscionable bargains and inequality of bargaining power. The module also examines the law relating to the discharge of contractual obligations (including performance, agreement, frustration and breach) and remedies for breach of contract such as damages, specific performance, recission and injunctions. Learning Outcomes Knowledge At the end of this module students will be able to: demonstrate a knowledge of foundation concepts in Contract law apply this knowledge to the solution of simple problems in contract law
Skills As well as their knowledge and understanding of the syllabus students will be assessed upon their ability to: retrieve up-to-date primary and secondary sources of legal information using both paper and electronic sources; Analyse primary legal materials Use legal terminology concerning the law of contract with accuracy Communicate effectively in writing Develop time and management skills Prioritise tasks effectively
Assessment Method(s): Examination: 70% Unseen Coursework 30% Indicative Reading: Core Texts (provided to students) Poole, Jill, Textbook on Contract Law, 2006 8th ed OUP UNDERGRADUATE PROGRAMME -3CONTRACT LAW
HOLBORN COLLEGE Further Reading: Beatson Ansons Law of Contract 28th ed. OUP Furmston, Michael Cheshire Fifoot & Firmstone Law of Contract, 14th edn Butterworths McKendrick E., Contract Law 5th ed. Palgrave Law Masters Stone, Modern Contract law 5th edn Cavendish Press Treitel GH, The Law of contract 11th ed Sweet and Maxwell Websites
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Increasingly the Internet is becoming a good source of information for law students. The following may be of use, but bear in mind that URLs are subject to change. (a) Law Reports www.the-times.co.uk/news This site has a searchable database going back to 1st January 1996. Law reports can be accessed for printing or downloading to disk. http://www.parliament.the-stationery-office.co.uk/pa/ld199697/ldjudgmt/ldjudgmt.htm Excellent free site containing full text of recent House of Lords' decisions - fully downloadable to print or disk. http://www.smithbernal.com/casbase Currently provides free transcripts of recent English cases very useful www.lawreports.co.uk This is the official law reports site has special student pages with case summaries. Also has 24 hour updated legal news pages day by day decision reports. http://www.courtservice.gov.uk/lexicon Court Service homepage has limited number of appeal case transcripts. (b) Parliament www.parlchan.co,uk/index.htm Quick reference guide to the House of Commons and its business www.parliament.uk Gateway site for the House of Commons and House of Lords (c) Legal referral sits www.venables.co.uk/ Excellent free general resources site provides a gateway to a host of other Web resources related to law. UNDERGRADUATE PROGRAMME -4CONTRACT LAW
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http://www.ukc.ac.uk/library/lawlinks/default.htm Currently one of the best gateway sites in the UK, maintained by the University of Kent. Numerous useful links. www.legal.net Gateway site to huge database of USA law - useful for comparative research www.findlaw.com/ Very comprehensive US searchable database great for comparative studies www.westlaw.com excellent summaries of cases on all subjects (d) Publishers www.cavendishpublishing.com Lots of useful information for students and good links regular case updates and a virtual classroom www.butterworths.co.uk Site for Butterworths the leading legal publishers - allows free access to a recent developments archive that is useful for quick reference - fully downloadable to print or disk. www.smlawpub.co.uk Site for Sweet & Maxwell, leading law publishers (e) Government sites www.hmso.gov.uk/stat.htm Very useful site providing full text of recent Acts of Parliament and some delegated legislation. Fully downloadable to print or disk. www.open.gov.uk/law.comm/hompage.htm Site allows access to full text of Law Commission consultation papers and reports. Requires Adobe Acrobat Reader for downloading to disk. http://www.open.gov.uk/index.htm Click on Whats new to get a list of recent government publications good for Law Commission updates, Home Office statements etc
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Contents
Introduction
Description of Module
Brief Indicative lecture outline Contract Law A Brief Outline Syllabus How To Use This Planner Reading List Learning Outcomes
Part 1
Study Unit One Offer Study Unit Two Acceptance Study Unit Three Consideration and Intention to Create Legal Relations Study Unit Four Promissory Estoppel Study Unit Five Privity of Contract Study Unit Six Certainty of Contract; Contents of Contracts Express Terms Study Unit Seven Contents of Contracts Implied Terms Study Unit Eight Relative Importance of Contractual Terms
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Study Unit Nine Exclusion Clauses Incorporation and Construction Study Unit Ten Exclusion Clauses The Unfair Contract Terms Act 1977
Part 2
Study Unit Eleven Misrepresentation Study Unit Twelve Mistake at Common Law Study Unit Thirteen Incapacity Minors Liability Study Unit Fourteen Duress and Undue Influence Study Unit Fifteen Illegality Study Unit Sixteen Restraint of Trade Study Unit Seventeen Frustration Study Unit Eighteen Discharge of Contracts Performance, Agreement and Breach Study Unit Nineteen Remedies for Breach of Contract Damages (1) Study Unit Twenty Remedies for Breach of Contract Damages (2) Study Unit Twenty One Remedies Equitable Remedies and Restitution Revision and Examination Technique
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HOLBORN COLLEGE Indicative lecture Outline
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Lecture 1 Lecture 2 Lecture 3 Lecture 3 Lecture 4 Lecture 5 Lecture 6 Lecture 7 Lecture 8 Lecture 9 Lecture 10
Introduction to the law of contract. Brief overview and reference to general ideas. Agreement The concept of an offer Agreement The concept of an offer and an invitation to treat Agreement Acceptance in contract Offer and Acceptance Recap and relationship between the two. Consideration 1 Consideration 2 Intention to create legal relations Part Payment/Promissory Estoppel Part Payment/Promissory Estoppel Problem solving skills How to answer a problem question, with reference to an examination type of question. How to answer an essay question. Privity of Contract 1 Privity of Contract 2 Terms of contract Express Terms of contract - Implied Terms Terms of a contract Exclusion Clauses 1 Terms of a contract Exclusion Clauses 2 Terms of a contract Exclusion Clauses 3 Vitiating factors Misrepresentation 1 Vitiating factors Misrepresentation 2 Vitiating factors Misrepresentation 3 Vitiating factors Mistake 1 Vitiating factors Mistake 2 Vitiating factors Mistake 3 Vitiating factors Duress Vitiating factors - Economic Duress Vitiating factors Undue influence 1
Lecture 11 Lecture 12 Lecture 13 Lecture 14 Lecture 15 Lecture 16 Lecture 17 Lecture 18 Lecture 19 Lecture 20 Lecture 21 Lecture 22 Lecture 19 Lecture 20 Lecture 21 Lecture 22
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HOLBORN COLLEGE Lecture 23 Lecture 24 Lecture 25 Lecture 26 Lecture 27 Lecture 28 Lecture 29 Lecture 30 Lecture 31 Lecture 32 Lecture 33 Lecture 34 Lecture 35 Lecture 36 Lecture 37 Lecture 38 Lecture 39 Vitiating factors Undue influence 2 Incapacity Illegality 1 Illegality 2 Contracts in restraint of trade 1 Contracts in restraint of trade 2 Discharge of Contracts Discharge by breach and agreement Discharge of contracts Discharge by performance Discharge of contracts Discharge by frustration 1 Discharge of contracts Discharge by frustration 2 Remedies for breach of contract Generally Remedies for breach of contract Damages 1 Remedies for breach of contract Damages 2 Remedies for breach of contract Equitable remedies Examination Technique Skills relevant to examination success
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Exams preparation A look at past problem papers and going through them Exams preparation A look at past essay questions and going through them
Remaining lectures will focus on revision of the subjects covered throughout the year. Students will be given the opportunity to ask for those subjects to be covered again which they have found particularly problematic.
There will be an opportunity to look at the assessments at the end of the planner and go through the steps of how to answer them.
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Introduction
Contract Law A Brief Outline

Contract Law is usually taught in the first year of undergraduate study leading to the LLB degree. It is fundamentally important as it lays down the foundations of the legal principles which would also apply and/or overlap in other areas of study, for example, property law, tort law, trusts law and employment law. It is also one of the few areas of law with which almost everyone comes into day-to-day contact. A simple examination of everyday activities would reveal the extent to which the law of contract makes an impact. Basically it is concerned with the enforceability of promises. The general body of contract law is immense, and this in fact creates one of the students greatest problems the sheer volume of information facing a student may seem, at least initially, a daunting if not downright impossible task to grasp. The general principles of contract law are of judge-made origin. That is to say, most of the major principles are contained in judicial decisions rather than statute. Hence, case law is the most important source of contract law, and as such it is very important that the student becomes accustomed to reading and researching case reports and statutory implications on the general principles of the law of contract. For the purposes of this course planner, the syllabus has been distinctly divided into three parts. The first tends to focus on preliminary issues pertaining to the formation of a legally enforceable contractual relationship. The second part examines the factors that may have the effect of vitiating a contract and analyses when a contract is void and when it is voidable. The third part analyses concepts relating to the performance of the contract and the ramifications of a breach. It also, within this context, assesses the remedies available. It is vital that the student attains a good understanding of the subject as a whole in order to perform well in the examinations. To this end, a good grasp or appreciation of the individual topics is necessary, so as to appraise the subject as a whole collectively. Students SHOULD NOT prepare individual topics for the examination, as examiners are looking for wellrounded answers that exhibit a thorough understanding of the subject as a whole. Hence, the following guidelines are suggested to aid the study of contract law. a) What does it take to form a contract? b) offer; acceptance; consideration; intention to create legal relations; certainty and privity of contract. contents of contract; contractual terms, implied and express terms; exclusion clauses and restraint of trade clauses. What can make a contract become void or voidable? vitiating factors such as misrepresentation, mistake, incapacity, duress and undue influence, illegality and frustration.
What becomes binding in a contract?
c) d)
When is a contract fully discharged?
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Remedies available
Students should learn to enjoy the subject. Once the interest is kindled, the rest of the task becomes easy.
Syllabus
a) The formation of contracts Offer and acceptance; consideration; certainty of agreement; intention to create legal relations. [Note: questions will not be set on requirements as to the form of contracts.] b) The content of the contract Conditions, warranties and intermediate terms; exemption clauses; implied terms at common law; collateral contracts; statutory implied terms with regard to the quality of goods sold and goods or services supplied. c) Vitiating factors Mistake; misrepresentation; duress and undue influence. d) Illegality and public policy (excluding gaming and wagering) Contracts illegal at common law; consequences of illegality; contracts in restraint of trade. e) f) g) Capacity to contract with particular reference to the capacity of minors. Privity of contract (excluding agency and assignment). Performance and breach Substantial performance; repudiation and anticipatory breach; discharge by breach; discharge under the doctrine of frustration. h) Remedies for breach of contract General principles governing the assessment of damages; remoteness of damage; damages for non-financial loss; mitigation; restitutionary remedies; liquidated damages and penalties; specific performance. [Note:the subject will also take account of relevant European Union legislation and how this is applied in the UK.] [Note:students are permitted to bring into the examination hall the following specified document: either one copy of Blackstones Statutes on Contract, Tort and Restitution (OUP), or one copy of Butterworths Student Statutes: Contract, Tort and Restitution or one copy of Sweet and Maxwells Contract, Tort & Restitution Statutes.]
How to Use this Planner

This Course Planner sets out in detail the full scope and extent of The Law of Contract. We intend it to be the basis of your work on this module.
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There is an indicative lecture outline which will enable the students to follow the lecture topics. This will assist them in preparation for the lecture, whether before or after the lecture takes place. There are also Seminars which students are expected to prepare for. These include interrograms and questions. Students are expected to prepare for each seminar and they will be expected to contribute to the discussions that take place in the seminars. The introduction will give you a brief overview of the subject areas to be studied. It is important to remember, while you learn each individual topic, that the areas all relate to one another and you should look at the subject as a whole, rather than as a series of isolated parts. The Planner is divided into two Parts, each Part dealing with each semester of the year.
Reading List
a) You must obtain the following books Obligations: Contract Law, Cracknell (4th edition) 2003 (Old Bailey Press) A Casebook on Contract, Smith and Thomas (11th edition) 2000 (Sweet and Maxwell) Contract Law, McKendrick (5th edition) 2003 (Macmillan) b) You should obtain the following book Contract, Cases and Materials, Beale, Bishop and Furmston (4th edition) 2001 (Butterworths) c) It would be useful to obtain the following book The Law of Contract, Treitel (11th edition) 2003 (Sweet and Maxwell) Please note that externally produced books (ie those not published by Old Bailey Press) may have new editions published during the life span of this Planner. This list is correct at the time of going to press. d) Reference to Journals CLJ JBL KCLJ Cambridge Law Journal Journal of Business Law Kings College Law Journal
LMCLQ Lloyds Maritime and Commercial Law Quarterly LQR LS MLR NLJ PL Law Quarterly Review Legal Studies Modern Law Review New Law Journal PublicLaw
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HOLBORN COLLEGE Learning Outcomes
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Each seminar contains a number of learning outcomes which are intended to guide students in their study of each topic. Once they have completed the reading for each study unit, students should go back to the learning outcomes and ensure that they understand the topics to which they refer. Remember that the subject must always be looked at as a whole: if you do not understand what the learning outcomes refer to, you will need to repeat your reading. You should not progress from one study unit to the next until you understand, and have reached, the learning outcomes for that particular study unit. Needless to say, if students have any problems of understanding key concepts, they can be clarified in the seminars.
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Part 1: Study Unit One Part 1: Study Unit One

Topic Topic Offer
Offer
Prologue Prologuethe first ingredient in the formation of a contract. Without an offer no contract The offer is
can ever be formed. The distinction between an offer and an invitation to treat is important to The offer is the first ingredient in the formation of a contract. Without an offer no contract be understood. can ever be formed. The distinction between an offer and an invitation to treat is important to be understood.
Essential Reading Essential Reading

Textbook on Contract Law Relevant Chapter(s)
Other Reading Other ReadingMaterials, Beale, Bishop and Furmston Relevant Chapter(s) Contract, Cases and
Contract,of Contract,Materials,Relevant Chapter(s)Furmston Relevant Chapter(s) The Law Cases and Treitel Beale, Bishop and The Law of Contract, Treitel Relevant Chapter(s) Contract Law, McKendrick Relevant Chapter(s)
Learning Outcomes Learning Outcomes

Students will be expected: Students will be expected: a) b) a) c) b) d) c) d)
To have understood what constitutes an offer. be able to distinguish constitutes an offer. To have understood whatan offer from an invitation to treat. To be able to distinguish a unilateral contract from ato treat. contract. an offer from an invitation bilateral understand the abovementioned principles by reference to decided To be able to distinguish a unilateral contract from a bilateral contract.cases To understand the abovementioned principles by reference to decided cases
Sources of Law Sources of Law Case Law

Case Law Offer
Bigg v Boyd-Gibbins Ltd [1971] 1 WLR 913; [1971] 2 All ER 183 Offer Carlill v Carbolic Smoke Ball Co [1893] 1 QB 256 Bigg v Boyd-Gibbins Ltd [1971] 1 WLR 913; [1971] 2 All ER 183 Carlill v Carbolic Smoke Ball Co [1893] 1 QB 256
UNDERGRADUATE PROGRAMME UNDERGRADUATE PROGRAMME
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INVITATIONS TO TREAT a) Generally Bigg v Boyd-Gibbins Ltd (above) Clifton v Palumbo [1944] 2 All ER 497 Gibson v Manchester CC [1979] 1 WLR 294; [1979] 1 All ER 972 (HL) Harvey v Facey [1893] AC 552 Spencer v Harding (1870) LR 5 CP 561 b) Display of goods Fisher v Bell [1961] 1 QB 394 Pharmaceutical Society of GB v Boots [1953] 1 All ER 482 c) Advertisements Carlill v Carbolic Smoke Ball Co (above) Grainger v Gough [1896] AC 325 Partridge v Crittenden [1968] 1 WLR 1204; [1968] 2 All ER 421 d) Ticket cases Chapelton v Barry UDC [1940] 1 KB 532 Thornton v Shoe Lane Parking [1971] 2 QB 163 e) Auctions Barry v Davies [2001] 1 All ER 944 Payne v Cave (1789) 3 Term R 148 Warlow v Harrison (1859) 29 LJ QB; (1859) 1 E and E 309 f) Tenders Blackpool and Fylde Aero Club v Blackpool BC [1990] 1 WLR 1195 Great Northern Railway v Witham (1873) LR 9 CP 16 Harvela v Royal Trust of Canada [1985] 2 All ER 966 (HL) Spencer v Harding (above) TERMINATION OF OFFER a) Revocation Byrne v Van Tienhoven (1880) 5 CPD 344 Daulia v Four Millbank Nominees [1978] 2 All ER 557 Dickenson v Dodds (1876) 2 Ch D 463 Errington v Errington and Woods [1952] 1 KB 290 Payne v Cave (above) Routledge v Grant (1828) 4 Bing 653 b) Lapse of time Ramsgate Victoria Hotel v Montefiore (1866) LR 1 Ex Ch 109 c) Terminating condition Financings Ltd v Stimson [1962] 1 WLR 1184 d) Death Bradbury v Morgan (1862) 1 H & C 249 Graves v Cohen (1929) 46 TLR 121
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Article
McMeel Contractual Intention: The Smoke Ball Strikes Back (1997) 113 LQR 47
Interrograms
1. 2. 3. 4. 5. 6. 7. 8. 9. 10. 11. 12. 13. 14. 15. 16. Define the word offer used in its contractual sense. What was the offer in Carlill v Carbolic Smoke Ball Co? Explain the meaning of an invitation to treat? Explain the decision in Partridge v Crittenden. How does Partridge v Crittenden differ from Carlill? Why is the display of goods in a shop window an invitation to treat? Why is the display of goods on supermarket shelves an invitation to treat? What is a Notice for Reward in contractual terms? Can an offer be made to the world at large? Who or what makes the offer in Thornton v Shoe Lane Parking? At an auction who or what makes the offer? What is an auction advertised as being without reserve? Must an acceptor have knowledge of the offer? If services are rendered that coincidentally fulfil the terms of an offer but are performed in ignorance of that offer do contractual obligations arise? How long does an offer remain open? Explain the decision in Routledge v Grant.
Questions
Past examination questions usually link the topic of offer and acceptance. See unit 2 for questions covering offer and acceptance. Do not attempt those questions until you have completed unit 2.
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Part 1: Study Unit Two Part 1: Study Unit Two

Topic Acceptance Topic
Acceptance
Prologue Once an offer is made, an acceptance should/must follow for a valid contract to be formed. Prologue
This topic examines the conditions relating to acceptance. Once an offer is made, an acceptance should/must follow for a valid contract to be formed. This topic examines the conditions relating to acceptance.
Essential Reading Obligations: Contract Law, Cracknell Relevant Chapter(s) Essential Reading
Textbook on Contract Law RelevantChapter(s)Chapter(s) Obligations: Contract Law, Cracknell Chapter(s) Contract Law, McKendrick Relevant Relevant Contract Law, McKendrick Relevant Chapter(s)
Other Reading Contract,ReadingMaterials, Beale, Bishop and Furmston Relevant Chapter(s) Other Cases and
Learning Outcomes Students will be expected: Learning Outcomes

b) a) c) b) c) d) e) d) e)
Students will be expected: a) To have understood what constitutes an acceptance. To have examined the battle of the an acceptance. To have understood what constitutesforms. To have examined the battle of the forms. To have learned the general rule on communication of acceptance and its exceptions, especially the postal rule. To have learned the general rule on communication of acceptance and its exceptions, To have examined revocation of unilateral contracts. especially the postal rule. To have examined the difficulties of Williams v Carwardine and R v Clarke. To have examined revocation of unilateral contracts. To have examined the difficulties of Williams v Carwardine and R v Clarke.
Brogden v Metropolitan Railway (1877) 2 App Cas 666 Acceptance by conductBall Co [1893] 1 QB 256 Carlill v Carbolic Smoke Brogden 4 Millbank Nominees [1978] Ch App Cas 666 Daulia v v Metropolitan Railway (1877) 2231; [1978] 2 All ER 557 Carlill v Carbolic Welsh Ball Co [1893] 1 QB [1983] Wettern Electric v Smoke Development Agency 256 2 All ER 629 Daulia v 4 Millbank Nominees [1978] Ch 231; [1978] 2 All ER 557 Wettern Electric v Welsh Development Agency [1983] 2 All ER 629
Acceptance Case Law by conduct
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HOLBORN COLLEGE COUNTER-OFFERS Butler Machine Tool Co v Ex-cell-o Corp [1979] 1 WLR 401 Hyde v Wrench (1840) 3 Beav 334 Society of Lloyds v Twinn (2000) The Times 4 April (CA) REQUEST FOR INFORMATION Stevenson v McLean (1880) 5 QBD 346 MOTIVE FOR ACCEPTANCE R v Clarke (1927) 40 CLR 227 Williams v Carwardine (1833) 5 Car and P 566 CROSS-OFFERS Tinn v Hoffman & Co (1873) 29 LT 271 COMMUNICATION a) General rule Entores v Miles Far East Corporation [1955] 2 QB 327; [1955] 3 WLR 48 b) Exceptions Entores v Miles Far East Corporation (above) Powell v Lee (1908) 99 LT 284 c) Instantaneous communications Brinkibon v Stahag Stahl [1983] 2 AC 34; [1982] 1 All ER 293 Entores v Miles Far East Corporation (above) d) Postal rule Adams v Lindsell (1818) B & Ald 681 Henthorn v Fraser [1892] 2 Ch 27 Holwell Securities v Hughes [1974] 1 WLR 155 Household Fire Insurance v Grant (1879) 4 Ex D 216 e) Prescribed form of acceptance Tinn v Hoffman & Co (above) f) Silence Felthouse v Bindley (1862) 11 CBNS 869 g) Revocation and the postal rule A to Z Bazaars (Pty) Ltd v Minister of Agriculture [1974] (4) SA 392 (c) Wenkheim v Arndt (1873) 1 JR 73 (NZ)
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Articles
Goh-Loo Soen Yin Construction of a Contract (1996) 30 L Teach 363
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HOLBORN COLLEGE Rawlings The Battle of Forms (1979) 42 MLR 715 Woodward Contracts and Communications [1982] CLJ 236
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Interrograms
1. 2. 3. 4. 5. 6. 7. 8. 9. Would the words I intend to take up your offer operate as an acceptance? Can acceptance of an offer be by conduct? Will a qualified acceptance be an acceptance, a counter-offer or a revocation? What is the last shot doctrine? How would you advise a client to avoid losing the battle of the forms? In a bilateral contract when is an oral acceptance effective? In a bilateral contract when is a telephoned oral acceptance effective? If the sound of an oral acceptance is drowned by a passing aircraft is there a contract? If an offer is telexed to B from As office and the acceptance is telexed by B to As office during office hours but As telex has run out of ink so no words appear, is there a contract? A writes to B offering to sell a certain property at a stated price. B writes to A offering to buy the same property at the same price. The letters cross in the post. Is there a contract? A sent a written offer to B in the next town. B posted a letter of rejection but then sent A a telegram accepting the offer, which reached A before Bs letter. Is there a contract? A sent an offer to B in the next town by telegram. B posted a letter of acceptance but then sent A a telegram rejecting the offer which reached A before Bs letter. Is there a contract? If the offeror expressly stipulates that he will not be bound until actual delivery of a letter of acceptance will the rule in Adams v Lindsell apply? If the written acceptance is lost in the post is there a contract? If the written acceptance is lost in the post because it was wrongly addressed is there a contract? When can silence be an effective acceptance? Can a unilateral offer be revoked when performance has commenced? What is the effect of a counter-offer on the original offer? If the parties describe their transactions as offer and acceptance, will that be conclusive? At an auction who or what makes the acceptance?
10.
11. 12.
13. 14. 15. 16. 17. 18. 19. 20.
Questions
1. John places an advertisement in the local gazette advertising the sale of his BMW for 6,500. Bill calls John and wishes to see the car. Bill sees the car and is deeply impressed by the condition of the car. He offers John 5000. John replies, On your bike! Bill leaves and is deeply disappointed. Bill calls on John again and says he is willing to pay 5,700. John maintains he will accept no less than 6,200 and Bill said he would get back to John the following day.
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Margaret sees Bill before he contacts John and says that John has sold the car on to somebody else. Advise Bill 2. Jamil is trying to sell his computer and places a notice in his College. Rahul is interested and meets Jamil offering him 650. Jamil accepts. An hour later, Jamil meets up with Rahul and says he has changed his mind. Discuss 3. Distinguish, by reference to decided cases, between unilateral and bilateral contracts. 4. Is it true to say that acceptance is the unconditional assent to the terms of the offer? Discuss by reference to decided cases. 5. Akill offers in writing to sell his motorbike to Iftikhar. Iftikhar writes back saying that he accepts at the price specified by Akill. Although Iftikhar duly posts the letter, it gets lost in the post. Akill is very angry and because he is in quick need of the money, sells the car onto someone else. Iftikhar is determined to sue Akill insisting that there was a legally binding agreement. Advise Akill
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Part 1: Study Unit Three Part 1: Study Unit Three

Topic
Consideration and Intention to Create Legal Relations Topic Consideration and Intention to Create Legal Relations
Prologue
This topic looks at the role and function of consideration (the price of the promise, or Prologue value) in the enforceability of contracts. It also looks at the traditional something of This topic looks at the role and function of consideration (the price of theexamines the benefit/detriment approach and the rules governing consideration. It further promise, or something of value) intention to create legalof contracts. It also looks at the traditional crucial element of an in the enforceability relations, without which the enforcement of a benefit/detriment a problem. and the rules governing consideration. It further examines the contract would be approach crucial element of an intention to create legal relations, without which the enforcement of a contract would be a problem.
Essential Reading
Obligations: Contract Law, Cracknell Relevant Chapter(s) Essential Reading Textbook on Contract Law RelevantChapter(s)Chapter(s) Contract Law, McKendrick Cracknell Chapter(s) Obligations: Contract Law, Relevant Relevant Contract Law, McKendrick Relevant Chapter(s)
Other Reading
Contract,ReadingMaterials, Beale, Bishop and Furmston Relevant Chapter(s) Other Cases and The Law Cases and Treitel Beale, Bishop and Contract,of Contract,Materials,Relevant Chapter(s)Furmston Relevant Chapter(s) Contract Law, McKendrick Relevant Chapter(s) The Law of Contract, Treitel Relevant Chapter(s)
Learning Outcomes
b) a) c) b) d) c) d) e) e)
a) To have appreciated that Learning Outcomes consideration is the economic reason for enforcing contracts.
Sources of Law
Case Law Sources of Law
CONSIDERATION Case Law
To have examined the traditional benefit/detriment approach. To have appreciated that consideration is the economic reason for enforcing contracts. To have learned the difficulties caused by so called past consideration. To have examined the traditional benefit/detriment approach. To have learned the difficulties surrounding performance of an existing duty as being To have learned the difficulties caused by so called past consideration. proper consideration. To have learned the difficulties surrounding performance of an existing duty as being To have considered the difference between agreements and contracts, especially the proper consideration. distinction between social arrangements and commercial dealings. To have considered the difference between agreements and contracts, especially the distinction between social arrangements and commercial dealings.
DEFINITION CONSIDERATION Currie v Misa (1875) LR 10 Ex 153 DEFINITION Dunlop Pneumatic Tyre v Selfridge [1915] AC 847 Currie v Misa (1875) LR 10 Ex 153 Dunlop Pneumatic Tyre v Selfridge [1915] AC 847
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HOLBORN COLLEGE MOVING FROM PROMISEE Bolton v Madden (1873) LR 9 QB 55 De le Bere v Pearson [1908] 1 KB 280 Dickenson v Abel [1969] 1 WLR 295 Thomas v Thomas (1842) 11 LJ QB 104 NOT NECESSARILY TO PROMISOR Tanner v Tanner [1975] 1 WLR 1346 PAST CONSIDERATION Lampleigh v Braithwaite (1615) Hob 105 Pau On v Lau Yiu Long [1980] AC 614; [1979] 3 All ER 65 (PC) Re Caseys Patents [1892] 1 Ch 104 Re McArdle [1951] Ch 669 Roscorla v Thomas (1842) 3 QB 234 SUFFICIENT NOT NECESSARILY ADEQUATE a) Adequacy Arrale v Costain Civil Engineering Ltd [1976] 1 Lloyds Rep 98 Callisher v Bischoffsheim (1870) LR 5 QB 449 Chappell v Nestl [1960] AC 87 Midland Bank v Green [1981] AC 513 Pitt v PHH Asset Management [1993] 4 All ER 961 (CA) White v Bluett (1853) 23 LJ Ex 36 b) Duties owed by law Collins v Godefroy (1831) 1 B & Ad 950 Glasbrook v Glamorgan CC [1925] AC 270 Ward v Byham [1956] 1 WLR 496 c) Duties owed by contract with promisor
LLB
Hartley v Ponsonby (1857) 2 El & B 872 North Ocean Shipping v Hyundai Construction (The Atlantic Baron) [1979] QB 705; [1978] 3 All ER 1170 Re Selectmove [1995] 2 All ER 531 (CA) Stilk v Myrick (1809) 2 Camp 317 Williams v Roffey Bros & Nicholls Ltd [1990] 1 All ER 512 (CA) d) Duties owed to third parties New Zealand Shipping v Satterthwaite (The Eurymedon) [1975] AC 154; [1974] 1 All ER 1015 Pao On v Lau Yiu Long (above) Scotson v Pegg (1861) 6 H and N 295 Shadwell v Shadwell (1860) 9 CBMS 159 INTENTION TO CREATE LEGAL RELATIONS SOCIAL AND DOMESTIC AGREEMENTS Balfour v Balfour [1919] 2 KB 571 Gould v Gould [1970] 1 QB 275
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CONTRACT LAW
HOLBORN COLLEGE Hardwick v Johnson [1978] 1 WLR 683 Jones v Padavatton [1969] 1 WLR 328 Merritt v Merritt [1970] 1 WLR 1211 Pettit v Pettit [1970] AC 777 Ramnarace v Lutchman [2001] 1 WLR 1651 Simpkins v Pays [1955] 1 WLR 975 COMMERCIAL AGREEMENTS Edwards v Skyways Ltd [1964] 1 WLR 349 Esso Petroleum v Customs & Excise Commissioners [1976] 1 WLR 1; [1976] 1 All ER 117 Evans v Merzario Ltd [1976] 1 WLR 1078 Kleinwort Benson Ltd v Malaysia Mining Corp Bhd [1989] 1 All ER 785 Percy Trentham Ltd v Archital Luxfer Ltd [1993] 1 Lloyds Rep 25 Pitt v PHH Asset Management [1993] 4 All ER 961 (CA) Walford v Miles [1992] 2 WLR 174; [1992] 1 All ER 453 HONOUR CLAUSES Jones v Vernon Pools Ltd [1938] 2 All ER 626 Rose and Frank v Crompton [1925] AC 445
LLB
Article
Adams Contract Law at Sea? North Ocean Shipping Co Ltd v Hyundai (1979) 42 MLR 557
Interrograms
CONSIDERATION 1. 2. 3. 4. 5. 6. 7. 8. 9. 10. 11. 12. 13. 14. What is meant by reciprocity? What was the consideration in Thomas v Thomas? Who must offer a benefit for a promise to be enforceable? Who must suffer a detriment for a promise to be enforceable? For 100 A promises to deliver 100 plastic gnomes to B. What is the consideration for such a promise? What is the ratio of Chappell v Nestl? In 1997 A gives B his car. In 1998 B promises A 1,000. Is that promise enforceable? Will there be consideration for a guarantee given after the goods were purchased? Why could Lampleigh enforce the promise from Braithwaite (Lampleigh v Braithwaite (1615)? Has Lord Scarmans obiter dicta in Pau On v Lau Yiu Long ever been applied? Did Lord Scarmans obiter dicta in Pau On v Lau Yiu Long change the law? Is a promise not to sue on a valid claim consideration for any settlement of the claim? If a person promises to do what he is already legally bound to do will that be good consideration? Do you think the mother was really providing something extra to provide consideration in Ward v Byham?
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CONTRACT LAW
HOLBORN COLLEGE 15. 16. 17. 18. 19. 20.
LLB
Why was the promise to pay the police force good consideration in Glasbrook v Glamorgan CC? Explain the distinction between Stilk v Myrick and Hartley v Ponsonby. Explain the difference between Stilk v Myrick and Williams v Roffey Bros & Nicholls. If A is bound by an existing contract to B and B promises A something new in return for the existing contractual duties can A enforce that promise? If a person promises to do what he is already bound by contract with a third party to do will that be good consideration? What was the consideration in Scotson v Pegg?
INTENTION TO CREATE LEGAL RELATIONS 21. 22. 23. 24. 25. 26. Does the law assume that mutual promises are intended to be enforceable? What is a domestic agreement? What is a commercial agreement? How does the law determine whether or not the parties intended to make a legallybinding contract? Could two businessmen entering into an agreement to further their business interests ensure it is binding in honour only? What is meant by a rebuttable presumption?
Questions
1. Champa is on trial for murder. Jan, a close friend of hers, visits her in prison one day. Jan says that she has received a subpoena to attend court to give evidence. Jan does not wish to give evidence because she is afraid of attending court. Champa promises to pay her 1000 if she attends. Jan duly attends and there is an acquittal. Champa is now refusing to pay. Advise Jan 2. a) b) With reference to case examples explain whether past consideration is valid consideration? Brian is a keen Chelsea supporter, but his son Wayne prefers West Ham United. Brian told Wayne that he would give him 1,000 if he did not support West Ham for a year. Wayne stopped going to West Hams home games and never wore his scarf in the team colours for a whole year. Secretly, however, he always hoped that West Ham would win their games. Wayne is now demanding the 1,000 from Brian.
3.
Consideration need not be adequate but must be sufficient Discuss the validity of this assertion.
4.
Which of the following is true of consideration? (i) (ii) (iii) It must be adequate and of sufficient value; It must move from the promise; It must never be past;
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CONTRACT LAW
HOLBORN COLLEGE (iv) (v) 5. It must be given in every binding agreement; It may be performance of an existing obligation
LLB
Anup organizes a Bhangra concert in a local field, and complies with all legal requirements. He is informed by the police that there will be a charge for the supervision of the crowds of people likely to be attracted to the event. He goes ahead with the concert but, on the day of the event, the weather is exceptionally cold and only a small crowd attend. The police are now claiming their money for attending the concert, but Anup is reluctant to pay because he says the police have only performed a public duty for which they are not entitled to payment. Advise Anup
6. 7. 8.
Critically analyse the main principles applicable in the law of consideration. Explain whether or not an intention to create legal relations is an essential element in a binding contract. Javed and Monica have been married for 3 years now. Javed promises to pay Monica 300 per month to cover her expenses and those of their 2 year old girl. They then end up separating and Javed refuses to pay Monica any further. Advise Monica.
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CONTRACT LAW
LLB LLB
Part 1: Study Unit Four Part 1: Study Unit Four

Topic Promissory Estoppel Topic
Promissory Estoppel
Prologue This study unit analyses the evolution of the concept of promissory (or equitable) estoppel Prologue
and its impact on the doctrine of consideration. This study unit analyses the evolution of the concept of promissory (or equitable) estoppel and its impact on the doctrine of consideration.
Textbook on Contract Law RelevantChapter(s)Chapter(s) Contract Law, McKendrick Relevant Relevant Obligations: Contract Law, Cracknell Chapter(s) Contract Law, McKendrick Relevant Chapter(s)
The Law Cases and Treitel Beale, Bishop and Contract,of Contract,Materials,Relevant Chapter(s)Furmston Relevant Chapter(s) The Law of Contract, Treitel Relevant Chapter(s) Contract Law, McKendrick Relevant Chapter(s)
Learning Outcomes a) To have examined Lord Learning Outcomes Dennings judgment in the High Trees case.
b) a) c) b) c) To have understood the Dennings judgment in the High To have examined Lord scope of promissory estoppel. Trees case. To have reconciled promissory estoppel to the doctrine of consideration. To have understood the scope of promissory estoppel. To have reconciled promissory estoppel to the doctrine of consideration.
Sources of Law Case Lawof Law Sources
COMMON LAW POSITION Case Law Foakes v Beer (1884) 9 App Cas 605 COMMON LAW POSITION Pinnels Case (1602) 5 Co Rep 117a Foakes v Beer (1884) 9 App Cas 605 Pinnels Case (1602) 5 Co Rep 117a BIRTH OF PROMISSORY ESTOPPEL Central London Property Trust v High Trees House [1947] 1 KB 130 BIRTH OF PROMISSORY ESTOPPEL Hughes v Metropolitan Railway (1877) 2 App Cas 439 Central London (1854) 5 HL Cas 185 Jordan v Money Property Trust v High Trees House [1947] 1 KB 130 Hughes v Metropolitan Railway (1877) 2 App Cas 439 Jordan v Money (1854) 5 HL Cas 185 SUBSEQUENT DEVELOPMENT a) Nature of promise SUBSEQUENT DEVELOPMENT HIH Casualty v AXA Corporate Solutions [2002] Lloyds Rep IR 325 a) Nature of promise HIH Casualty v AXA Corporate Solutions [2002] Lloyds Rep IR 325 UNDERGRADUATE PROGRAMME UNDERGRADUATE PROGRAMME - 26 - 26 CONTRACT LAW CONTRACT LAW
HOLBORN COLLEGE Scaptrade, The [1983] 2 All ER 763 Taylor v Lancashire [2001] NPC 34 Woodhouse v Nigeria Produce [1972] AC 741 b) Shield not sword Baird Textiles v Marks & Spencer [2002] 1 All ER (Comm) 737 Combe v Combe [1951] 2 KB 215 c) Clean hands doctrine D & C Builders v Rees [1966] 2 QB 617 d) Reliance Ajayi v Briscoe (above) Alan v El Nasr [1972] 2 WLR 109; [1972] 2 All ER 127 Central London Property Trust v High Trees House (above) Goldsworthy v Brickell [1987] 1 All ER 853 Societe Italo-Belge v Palm Oils (The Post Chaser) [1982] 1 All ER 19 Tool Metal v Tungsten Electric [1955] 1 WLR 761; [1955] 2 All ER 657 e) Suspensive or extinctive Ajayi v Briscoe (above) Alan v El Nasr (above) Central London Property Trust v High Trees House (above) D & C Builders v Rees (above) Tool Metal v Tungsten Electric (above) f) Relationship with proprietary estoppel Baird Textiles v Marks & Spencer (above) Crabb v Arun DC [1976] Ch 179 ESTOPPEL BY CONVENTION
LLB
Amalgamated Investment and Property Co v Texas Commerce International Bank [1981] 3 All ER 577 Keen v Holland [1984] 1 All ER 75
Articles
Donaldson Part-payment of Debt Cheque Principle of High Trees Case [1966] CLJ 14 Dugdale and Yates Variation, Waiver and Estoppel A Re-Appraisal (1976) 39 MLR 680 Halson The Offensive Limits of Promissory Estoppel [1999] LMCLQ 256 Nolan Following in their Footsteps: Equitable Estoppel in Australia and the United States (2000) KCLJ 202 OSullivan In Defence of Foakes v Beer [1996] CLJ 219 Peel Part Payment of a Debt is No Consideration (1994) 110 LQR 353 Thompson From Representation to Expectation: Estoppel as a Cause of Action [1983] CLJ 257 Unger The High Trees Case: Promise or Gift (1965) 28 MLR 231
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CONTRACT LAW
HOLBORN COLLEGE
LLB
Interrograms
1. 2. 3. 4. 5. 6. 7. What is the meaning of the word estoppel? Is a creditor bound by an undertaking to accept part-payment in full settlement of a debt? A owes B 10 to be paid on June 1st. A pays B 5 on May 30th in full satisfaction of the debt. Can B sue for the remainder? Why did Mrs Beer succeed in her claim against Dr Foakes (Foakes v Beer (1884))? Why could D & C Builders enforce the original contract price of 482 after accepting 300 in full satisfaction? Do the courts allow a cause of action of breach of an estoppel? If the plaintiff in Foakes v Beer could go back on her promise not to ask for interest, why could the plaintiffs not go back on their promise and ask for full rent during the war years in High Trees? What would have been the position if the landlord had given reasonable notice during the war of the termination of the agreement for a reduced rent in the High Trees case? Is it true to say that the landlords rights to full rent during the war years were extinguished by the estoppel? What is the concept of equitable forbearance mentioned by Lord Cairns in Hughes v Metropolitan Railway? How does Lord Denning deal with the conflicting case of Jordan v Money? What is the ratio of Tool Metal Engineering v Tungsten? What is meant by the description of estoppel in Combe v Combe as a shield and not a sword? Can a promissory estoppel create new rights? Does the party hearing the representation not to insist on strict legal rights have to act to his detriment in order to enable the estoppel to work? Has High Trees, and in particular, Denning LJs obiter, ever been applied? What is proprietary estoppel? How is the decision in WJ Alan v El Nasr reconciled with that of D & C Builders? How far is it true to say that a promise given without consideration has no effect in law? What are the disadvantages for the law of contract of the doctrine of promissory estoppel? What do you understand by estoppel by convention?
8. 9. 10. 11. 12. 13. 14. 15. 16. 17. 18. 19. 20. 21.
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CONTRACT LAW
HOLBORN COLLEGE
LLB
Questions
1. The principle of promissory estoppel is a shield but not a sword Discuss the validity of this assertion. 2. John owes 600 to Matilda. Matilda has agreed to accept 500 from John in full settlement of Johns debt. Two weeks later when John is in a position to pay Matilda, she changes her mind and insists on full payment of the outstanding amount. Advise John. 3. 4. To what extent is it possible to argue that the doctrine of promissory estoppel will prevent a party to a contract from enforcing his or her legal rights? William had asked Melissa, a garage proprietor and qualified mechanic, to do some repairs on his Lamborghini insisting it needed to be completed within 4 months. When the time was drawing to a close Melissa called William saying that the car would not be done in time, and William therefore agreed to give a further 2 months. Melissa assured him the work would be complete. Two months later the work still had not been done, and William gave Melissa notice that if the work would not be done in 2 weeks he would cancel. The work was still not done and William refued to accept the car. Advise Melissa
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CONTRACT LAW
LLB LLB
Part 1: Study Unit Five Part 1: Study Unit Five

Topic
Privity of Contract Topic Privity of Contract
Prologue
This examines the traditional doctrine of privity which states that only the parties to a contract Prologue can acquire rights and/or liabilities in respect of that contract. However, the new Contracts This examines theParties) Act 1999 seeks to confer benefitsthat only the parties to a contract (Rights of Third traditional doctrine of privity which states on third parties who may now can acquire rights and/or they were notrespect of that contract. However, the new Contracts enforce contracts to which liabilities in privy initially. (Rights of Third Parties) Act 1999 seeks to confer benefits on third parties who may now enforce contracts to which they were not privy initially.
Essential Reading
Obligations: Contract Law, Cracknell Relevant Chapter(s) Essential Reading Contract Law, McKendrick Relevant Relevant Textbook on Contract Law RelevantChapter(s)Chapter(s) Obligations: Contract Law, Cracknell Chapter(s) Contract Law, McKendrick Relevant Chapter(s)
Other Reading
Contract,ReadingMaterials, Beale, Bishop and Furmston Relevant Chapter(s) Other Cases and The Law Cases and Treitel Beale, Bishop and Contract,of Contract,Materials,Relevant Chapter(s)Furmston Relevant Chapter(s) Contract Law, McKendrick Relevant Chapter(s) The Law of Contract, Treitel Relevant Chapter(s)
Learning Outcomes
b) a) b)
a) To have considered the Learning Outcomes doctrine of privity of contract. To have understood the impact of the Contracts (Rights of Third Parties) Act 1999 on To have considered the doctrine of privity of contract. the doctrine of privity. To have understood the impact of the Contracts (Rights of Third Parties) Act 1999 on the doctrine of privity.
Sources of Law
Statutes of Law Sources
Contracts (Rights of Third Parties) Act 1999 Statutes Road Traffic Act of Third Parties) Contracts (Rights 1972: s148(4) Act 1999 Law Traffic Act 1972: s148(4) Roadof Property Act 1925: s56 MarriedProperty Act 1925: s56 1882 (s11) Law of Womens Property Act Married Womens Property Act 1882 (s11)
Case Law
THE BASIC RULE Case Law Darlington BC v Wiltshire Ltd [1995] 1 WLR 68; [1995] 3 All ER 895 (CA) THE BASIC RULE Dunlop v Selfridge [1915] AC 847 Darlington BC v Wiltshire Ltd [1995] 1 WLR 68; [1995] 3 All ER 895 (CA) Dunlop v Selfridge [1915] AC 847 UNDERGRADUATE PROGRAMME UNDERGRADUATE PROGRAMME - 30 - 30 CONTRACT LAW CONTRACT LAW
HOLBORN COLLEGE
LLB
New Zealand Shipping Co v Satterthwaite (The Eurymedon) [1975] AC 154; [1974] 1 All ER 1015 Port Jackson Stevedoring v Salmond and Spraggon (The New York Star) [1981] 1 WLR 138 Scruttons v Midland Silicones [1962] AC 446 Southern Water Authority v Carey [1985] 2 All ER 1077 Taddy v Sterious [1904] 1 Ch 354 Tweddle v Atkinson (1861) 1 B & S 393 RULE NOT APPLICABLE a) Collateral contracts Alicia Hosiery v Brown Shipley [1970] 1 QB 195 Shanklin Pier v Detel [1951] 2 KB 854 b) Multi-party agreements Clarke v Earl of Dunraven [1897] AC 59 EQUITY IMPOSING LIABILITY Bendall v McWhirter [1952] 2 QB 466 Port Line v Ben Line [1958] 2 QB 146 Tulk v Moxhay (1848) 2 Ph 774 EQUITY CREATING BENEFITS Flavell, Re (1883) 25 Ch D 89 Schebsman, Re [1944] Ch 83 Vandepitte v Preferred Accident Insurance [1933] AC 70 SUING IN ANOTHER CAPACITY Beswick v Beswick [1968] AC 58 DAMAGES Jackson v Horizon Holidays [1975] 1 WLR 1468 Woodar Investments v Wimpey Construction [1980] 1 WLR 227; [1980] 1 All ER 571
Articles
Adams and Brownsword Privity of Contract: The Pestilential Nuisance (1993) 56 MLR 722 Andrews Reform of the Privity Rule in English Contract Law The Law Commissions Report No 242 [1997] CLJ 25 Davey Privity of Contract and Leases Reform at Last (1996) 59 MLR 78 Ramage The Contract (Rights of Third Parties) Act 1999 [2000] 14 April NLJ 540 Tettenbom Symbolic but Sensible the Contracts (Rights of Third Parties) Act 1999 Amicus Curiae (Journal of the Society for Advanced Legal Studies) Issue 25, 24 March 2000
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CONTRACT LAW
HOLBORN COLLEGE
LLB
Interrograms
1. 2. 3. 4. 5. 6. Why could Dunlop not enforce the price clause with Selfridge (Dunlop v Selfridge (1915))? In Beswick v Beswick did the House of Lords mitigate the doctrine of privity? Are there any statutory exceptions to the doctrine of privity of contract? Privity of contract has been described as a blot on our law and most unjust. Do you agree? How has the Contracts (Rights of Third Parties) Act 1999 changed the previous law? What are its main provisions?
Questions
1. Has the doctrine of privity of contract been amended by the Contract (Rights of Third Parties) Act? 2. Frank is an internationally recognized architect. He was engaged by Global plc to act as supervising architect for their prestigious new shopping centre development. Global agreed to pay a fee of 30,000 to Holdings Ltd, a company wholly owned by Franks children, in return for Franks services, on the completion of the centre. Immediately after the centre is completed, and before the fee is paid, Frank dies from a heart attack. Gloabal are refusing to pay the 30,000 to Holdings Ltd. Advise Holdings Ltd
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CONTRACT LAW
LLB LLB
Part 1: Study Unit Six Part 1: Study Unit Six

Topic
Certainty of Contract; Contents of Contracts Express Terms Topic Certainty of Contract; Contents of Contracts Express Terms
Prologue
Certainty of contracts examines and illustrates the need for contracts to be certain and Prologue unambiguous. If contracts are too vague they cannot be enforced. Certainty of contracts examines and illustrates the need for contracts to be certain and unambiguous. If contracts are too vague they cannot be enforced.
Essential Reading
Obligations: Contract Law, Cracknell Relevant Chapter(s) Essential Reading Textbook on Contract Law RelevantChapter(s)Chapter(s) Contract Law, McKendrick Relevant Relevant Obligations: Contract Law, Cracknell Chapter(s) Contract Law, McKendrick Relevant Chapter(s)
Other Reading
Contract,ReadingMaterials, Beale, Bishop and Furmston Relevant Chapter(s) Other Cases and The Law of Contract,Materials,Relevant Chapter(s)Furmston Relevant Chapter(s) Contract, Cases and Treitel Beale, Bishop and The Law of Contract, Treitel Relevant Chapter(s) Contract Law, McKendrick Relevant Chapter(s)
Learning Outcomes
a) To have considered the Learning Outcomes need for certainty of contractual terms and ways of determining certainty. a) To have considered the need for certainty of contractual terms and ways of determining b) To be able to classify a pre-contractual statement as a term or a representation. certainty. c) To have understood the guidelines for making the term/representation distinction. b) To be able to classify a pre-contractual statement as a term or a representation. d) To have examined the concept of a collateral contract. c) To have understood the guidelines for making the term/representation distinction. e) To have learned the parol evidence rule and its exceptions. d) To have examined the concept of a collateral contract. e)
Sources of Law
Statutes of Law Sources
Certainty Statutes Certainty
To have learned the parol evidence rule and its exceptions.
Law of Property (Miscellaneous Provisions) Act 1989: s2 Sale of Goods Act 1979: s8 Law Property (Miscellaneous Provisions) Act 1989: s2 Supply of Goods and Services Sale of Goods Act 1979: s8 Act 1982: s15(1) Sale and Supply and Services 1994 Supply of Goodsof Goods Act Act 1982: s15(1) Sale and Supply of Goods Act 1994
- 33 - 33 -
HOLBORN COLLEGE
LLB
Case Law
Certainty
Baird Textiles v Marks & Spencer [2002] 1 All ER (Comm) 737 Campbell v Edwards [1976] 1 WLR 403 Foley v Classique Coaches [1934] 2 KB 1 Forrester v UYCF Ltd [2000] NPC 141 Hillas v Arcos (1932) 147 LT 503 Mamidoil-Jetoil Greek Petroleum v Okta Crude Oil Refinery [2001] 2 All ER (Comm) 193 Manatee Towing Co v Oceanbulk Maritime SA [1999] 2 All ER (Comm) 306 May & Butcher v R [1934] 2 KB 17 Scammel v Ouston [1941] AC 251 Sudbrook Trading Estate Ltd v Eggleton [1983] 1 AC 444; [1982] 3 All ER 1 Walford v Miles [1992] 2 WLR 174; [1992] 1 All ER 453 INCORPORATION OF TERMS a) Strength of statement Schawel v Reade [1913] 1 IR 81 b) Importance of statement Bannerman v White (1861) 10 CB (NS) 844 Couchman v Hill [1947] KB 54 c) Relative knowledge Dick Bentley Productions Ltd v Harold Smith Motors [1965] 1 WLR 623; [1965] 2 All ER 65 Harling v Eddy [1951] 2 KB 739 Oscar Chess v Williams [1957] 1 WLR 370 d) Reduction to writing Routledge v McKay [1954] 1 WLR 615; [1954] 1 All ER 855 e) Lapse of time Bannerman v White (1861) 10 CB (NS) 844 Routledge v McKay [1954] 1 All ER 855 f) Overall test Heilbut, Symons v Buckleton [1913] AC 30 COLLATERAL CONTRACTS City & Westminster Properties v Mudd [1959] Ch 129 De Lasalle v Guildford [1901] 2 KB 215 Esso Petroleum v Mardon [1976] QB 801; [1976] 2 All ER 5 Evans v Merzario Ltd [1976] 1 WLR 1078 Eyre v Measday [1986] 1 All ER 488 Heilbut, Symons v Buckleton (above) Pitt v PHH Asset Management [1993] 4 All ER 961 (CA) Shanklin Pier v Detel Products [1951] 2 KB 854 Thake v Maurice [1986] 1 All ER 497
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CONTRACT LAW
HOLBORN COLLEGE PAROL EVIDENCE RULE Goss v Lord Nugent (1833) 5 B & Ad 58 EXCEPTIONS City & Westminster Properties v Mudd (above) Couchman v Hill (above) Pym v Campbell (1856) 6 E & B 370
LLB
Articles
Milne Trusts and Contracts for the Sale of Land [2000] NLJ (Easter Appeals), 23 Wilde Contracts for the Sale of Disposition of Land (1993) 109 LQR 191
Interrograms
CERTAINTY OF CONTRACT 1. 2. 3. 4. 5. Distinguish May & Butcher v R from Foley v Classique Coaches. Why was there no contract in Scammel v Ouston? What does the expression subject to contract mean? Why is it so important to solicitors that their letters marked subject to contract should not be of legal effect? Does the law recognise an agreement to agree something?
CONTENTS EXPRESS TERMS 6. 7. 8. 9. 10. 11. 12. 13. 14. 15. 16. 17. 18. What is an express term of contract? What is a mere puff? Is a pre-contractual statement likely to be a term if the person making it expressly asks the other party to verify its truth? Is a pre-contractual statement likely to be a term where its importance is such that, if it had not been made, there would have been no contract formed? Distinguish Oscar Chess v Williams from Dick Bentley Productions v Harold Smith Motors. Why was the defendants statement as to the age of the motorcycle not a term of the contract in Routledge v McKay? What is the ratio of Heilbut Symons v Buckleton? What is a collateral contract? What is the consideration for a collateral contract? What is the parol evidence rule? Where a contract is written will extrinsic evidence be allowed to show when the contract should begin to operate? Where a contract is written will extrinsic evidence be allowed to show in what capacities the parties contracted? Is the parol evidence rule still good law at present?
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CONTRACT LAW
HOLBORN COLLEGE 19. 20.
LLB
Why did the Court of Appeal not allow the defendants to rely on their printed standard terms for carrying the goods above deck in Evans v Merzario? How does a mere representation become an express term?
Questions
See unit 8. Do not attempt those questions until you have completed units 7 and 8.
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CONTRACT LAW
LLB LLB
Part 1: Study Unit Seven Part 1: Study Unit Seven

Topic Contents of Contracts Implied Terms Topic
Contents of Contracts Implied Terms
Prologue Contents of contracts looks at the terms and representations that form the contract. Implied Prologue
terms are one of two types of terms that are implied into contracts by either the courts, custom Contents of contracts looks at Primarily these terms give the contract the contract. Implied or by the parties themselves. the terms and representations that form business efficacy or terms are one of two types of terms that are implied into contracts by either the courts, custom commercial sense. or by the parties themselves. Primarily these terms give the contract business efficacy or commercial sense.
Essential Reading Obligations: Contract Law, Cracknell Relevant Chapter(s Essential Reading
Textbook on Contract Law RelevantChapter(s)Chapter(s Contract Law, McKendrick Relevant Relevant Obligations: Contract Law, Cracknell Chapter(s) Contract Law, McKendrick Relevant Chapter(s)
The Law Cases and Treitel Beale, Bishop and Contract,of Contract,Materials,Relevant Chapter(s)Furmston Relevant Chapter(s) Contract Law, McKendrick Relevant Chapter(s) The Law of Contract, Treitel Relevant Chapter(s)
Learning Outcomes a) To have understood the Learning Outcomes principles a court considers when deciding to imply a term.
b) a) b) c) c) d) d) To have understood the principles abystander test as expressed in Shirlawa v Southern To have examined the officious court considers when deciding to imply term. Foundries. To have examined the officious bystander test as expressed in Shirlaw v Southern To have learnt the principal terms implied by law in a sale of goods contract and a Foundries. contract for the supply of goods and services. To have learnt the principal terms implied by law in a sale of goods contract and a To have examined under what circumstances a term can be implied by custom. contract for the supply of goods and services. To have examined under what circumstances a term can be implied by custom.
Sources of Law Statutes of Law Sources
Late Payment of Commercial Debts (Interest) Act 1998 Statutes Sale Payment Act 1979: ss1215 Late of Goods of Commercial Debts (Interest) Act 1998 (Amendment) Act Sale of Goods Act 1979: ss1215 1995 Supply Goods (Amendment) Act 1982: ss210 and 1315 Sale of of Goods & Services 1995 (Implied Terms) Act ss210 and 1315 Supply of Goods & Services Act 1982:1973: ss8 11 Sale and Supply (Implied Terms) Act Supply of Goodsof Goods Act 1994 1973: ss8 11 Sale and Supply of Goods Act 1994 UNDERGRADUATE PROGRAMME UNDERGRADUATE PROGRAMME - 37 - 37 CONTRACT LAW CONTRACT LAW
HOLBORN COLLEGE
LLB
Case Law
TERMS IMPLIED BY INTENTION OF PARTIES Ali and Others v Christian Salvesan Food Services Ltd [1997] 1 All ER 721 (CA) Equitable Life Assurance Society v Hyman [2002] 1 AC 408 (HL) Eyre v Measday [1986] 1 All ER 488 Luxor v Cooper [1941] AC 108 Moorcock, The (1889) 14 PD 64 Reigate v Union Manufacturing Co [1918] 1 KB 592 Shell UK v Lostock Garages [1976] 1 WLR 1187 Shirlaw v Southern Foundries [1940] AC 701 (HL) Times Newspapers v George Weidenfeld & Nicolson [2002] FSR 463 TERMS IMPLIED FROM RELATIONSHIP BETWEEN PARTIES Alghussein Establishment v Eton College [1991] 1 WLR 587; [1991] 1 All ER 267 (HL) Harvela v Royal Trust of Canada [1985] 2 All ER 966 (HL) Lister v Romford Ice & Cold Storage [1957] AC 555 Liverpool CC v Irwin [1977] AC 236 (HL) Malik v BCCI [1997] 3 WLR 95; [1997] 3 All ER 1 (HL) Wettern Electric v Welsh Development Agency [1983] 2 All ER 629 TERMS IMPLIED BY CUSTOM British Crane Hire v Ipswich Plant Hire [1975] QB 303 Hutton v Warren (1836) 1 M & W 466 TERMS IMPLIED UNDER SALE OF GOODS LEGISLATION Marimpex Minerall Handelgesellschaft MbH v Louis Dreyfus GmbH [1995] 1 Lloyds Rep 167 Saphena Computing Ltd v Allied Collection Agencies Ltd [1995] FSR 616 (CA) Wilson v Best Travel [1993] 1 All ER 353
Articles
Boon & Phang Implied Terms in English Law Some Recent Developments [1993] JBL 242 Smith Contracts Mistake, Frustration and Implied Terms (1994) 110 LQR 400
Interrograms
1. 2. 3. 4. 5. 6. 7. What is the ratio decidendi of The Moorcock? What is the officious bystander test? What remedies are available for breach of an implied term? Why is the decision in Shell UK v Lostock Garages of great importance? Explain the decision in Lister v Romford Ice. Is Lister v Romford Ice good law today? Explain briefly the effect of s14 of Sale of Goods Act 1979, as amended by s1 Sale and Supply of Goods Act 1994.
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CONTRACT LAW
HOLBORN COLLEGE 8. 9. 10. 11. 12. 13. 14. 15. 16. What term is implied by s12 of Sale of Goods Act 1979? What term is implied by s13 of the Supply of Goods and Services Act 1982? Part I of the Supply of Goods and Services Act 1982 is concerned with what?
LLB
How do the statutes mentioned above protect consumers? What are the effects of the Sale and Supply of Goods Act 1994 and Sale of Goods (Amendment) Act 1995? What is a custom? Explain the decision in British Crane Hire v Ipswich Plant Hire. How is a term implied into a contract? Give a case where the courts have implied a term into a contract for reasons of public policy. Give a case where the courts have refused to imply a term into a contract for reasons of public policy.
Questions
See unit 8. Do not attempt those questions until you have completed unit 8.
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CONTRACT LAW
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Part 1: Study Unit Eight Part 1: Study Unit Eight

Topic Relative Importance of Contractual Terms Topic
Relative Importance of Contractual Terms
Prologue The relative importance of contractual terms looks at the nature of contractual terms and Prologue
distinguishes between mere representations and legally binding (contractual) terms. It also The relative importance of contractual terms looks or implied terms contractual terms in a examines the various situations in which express at the nature of may be present and distinguishes between mere representations and legally binding (contractual) terms. It also contract. examines the various situations in which express or implied terms may be present in a contract.
Contract,of Contract,Materials,Relevant Chapter(s)Furmston Relevant Chapter(s) The Law Cases and Treitel Beale, Bishop and Contract Law, McKendrick Relevant Chapter(s) The Law of Contract, Treitel Relevant Chapter(s)
Learning Outcomes a) To have understood the Learning Outcomes threefold classification of contractual terms.
b) a) c) b) d) c) d) To have learnt the remedies available to the innocent party for breach To have understood the threefold classification of contractual terms. of a term. To have examined remedies availablethe the innocent party the innominate term. To have learnt the the importance of to development of for breach of a term. To have examined any developments of development of the innominate term. To have examined the importance of the the law since the Hong Kong Fir case. To have examined any developments of the law since the Hong Kong Fir case.
Sources of Law Sources of Law Statutes
Sale of Goods Act 1979 Statutes Sale of Goods Act 1979 Act 1994 and Supply of Goods Sale and Supply of Goods Act 1994
Case Law
CONDITIONS Case Law Barber v NSW Bank plc [1996] 1 All ER 906 (CA) CONDITIONS Behn v Burness (1863) 3 B and S 751 Barber & NSW Bank plc [1996] 1 All ER 906 (CA) 3 WLR 723 British v Commonwealth Holdings v Quadrex [1989] Behn vv Tradax (1863) 3 B [1981]751 Bunge Burness Export SA and S 1 WLR 711; [1981] 2 All ER 513 British & Commonwealth Holdings v Quadrex [1989] 3 WLR 723 Bunge v Tradax Export SA [1981] 1 WLR 711; [1981] 2 All ER 513 UNDERGRADUATE PROGRAMME UNDERGRADUATE PROGRAMME - 40 - 40 CONTRACT LAW CONTRACT LAW
HOLBORN COLLEGE Head v Tattersall (1871) LR7 Ex7 Mihalis Angelos, The [1971] 1 QB 164 Poussard v Spiers (1876) 1 QBD 410 Pym v Campbell (1856) 6 E & B 370 WARRANTIES Bettini v Gye (1876) 1 QBD 183 INNOMINATE TERMS Cehave v Bremer Handelgesellschaft (The Hansa Nord) [1976] QB 44 Federal Commerce & Navigation Co v Molena Alpha Inc [1979] AC 757 Hong Kong Fir Shipping v Kawasaki Kisen Kaisha [1962] 2 QB 26 Reardon Smith v Hansen-Tangen [1976] 1 WLR 989; [1976] 3 All ER 570 INTERPRETATION Lombard North Central plc v Butterworth [1987] 1 All ER 267 Schuler v Wickman Machine Tools [1974] AC 235 (HL)
LLB
Article
MacMillan When Standard Terms are Terms of a Contract [1996] CLJ 427
Interrograms
1. 2. 3. 4. 5. 6. 7. 8. 9. 10. 11. 12. 13. 14. 15. 16. What is a warranty? What is a condition? What remedy is available to the innocent party for breach of a warranty? What remedy is available to the innocent party for breach of a condition? Distinguish Poussard v Spiers from Bettini v Gye. Why was the innocent party not entitled to terminate in the Hong Kong Fir case? On the facts of Hong Kong Fir what would have been the decision if the voyage had been delayed for 12 months? What is an intermediate stipulation in a contract? What classification of terms is used in the Sale of Goods legislation? Why did Lord Denning MR decide that the expected ready to load clause in the Mihalis Angelos was a condition? Why did the court not give effect to the parties intentions in Schuler v Wickman? Why did the court not allow repudiation in Reardon Smith v Hansen-Tangen? In Bunge v Tradax what was the underlying reason as far as the House of Lords was concerned for allowing repudiation? What was the innominate term in the Hansa Nord case? How has the law developed since the Hong Kong Fir case? How can a party find out if his breach is such as to excuse all further performance?
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CONTRACT LAW
HOLBORN COLLEGE
LLB
Questions
1. Whether a breach of contract discharges the contract or not depends upon the nature of the term broken. Discuss. 2. The remedies open to the innocent party for breach of a contractual stipulation no longer depend upon the classification of the stipulation as a condition or a warranty. Explain and comment. 3. The attempt by some judges to define the provisions of a contract in terms other than that of conditions and warranties is no more than a romantic exercise in semantics. Discuss. 4. Not all contractual terms are treated as conditions or warranties. In the past few decades it has been recognised that the classification of terms into conditions and warranties is somewhat unsatisfactory. Commercial certainty requires that business people should know what risks they are undertaking. This can only be achieved by classifying contractual terms at the time of the contract. Consider how these views have been reflected in recent case law. 5. J made a contract with K, a builder, for K to build an extension to Js house for a price of 8,000 to be paid on completion. The contract stated: It is a condition of this contract that all work will be performed with proper skill and care and that the house will remain habitable throughout the period of the works. The work was estimated to take six weeks to complete. Two weeks after work started J learned that other local builders would have done the same job for 6,000. A week after that L, a labourer employed by K, carelessly fractured a water pipe: the house was flooded and J and his family were forced to leave it for three days. J informed K that he regarded the contract as cancelled, but K wishes to complete the job. Advise K. 6. In January P appointed R as his personal assistant for three years at a salary of 20,000. Rs service agreement included the following provisions: a) b) c) R will work such hours as are required; R will not consume alcohol when on duty; it is strictly understood and it is a condition of the agreement that R will maintain a credit balance in his bank account at all times.
P has just discovered that R occasionally drinks a can of light ale at the office when working late at night and that Rs bank account was overdrawn by 10 for four days last week. Advise P, who thinks he could now find a suitable personal assistant at a salary of 15,000.
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CONTRACT LAW
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Part 2: Study Unit Nine Part 2: Study Unit Nine

Topic Exclusion Clauses Incorporation and Construction Topic
Exclusion Clauses Incorporation and Construction
Prologue Exclusion clauses, and their incorporation and construction, examines how a party can deny Prologue
or reduce liability by using exclusion or limitation clauses as a term in a contract. The Exclusion clauses, and their incorporation and construction, examines how a party can deny position at common law is also analysed. or reduce liability by using exclusion or limitation clauses as a term in a contract. The position at common law is also analysed.
Learning Outcomes a) To have learned the correct approach to an exclusion or limitation clause in a contract. Learning Outcomes
b) a) c) b) d) c) d) To have understood the concept of incorporation into limitation clause in a contract. To have learned the correct approach to an exclusion orthe contract. To have learnt the case law illustrating the various into the contract. To have understood the concept of incorporation methods of incorporation. To have understood the contra proferentem rule methods of incorporation. To have learnt the case law illustrating the variouswhen construing a term in a contract. To have understood the contra proferentem rule when construing a term in a contract.

a) a)
Incorporation Case Law of exclusion clauses Incorporation of exclusion clauses

Reasonable notice Geier v Kujawa [1970] 1 Lloyds Rep 364 Reasonable notice Parker v SE Railway (1877) 2 CPD 416 Geier v Kujawa [1970] 1 Lloyds Rep 364 Sugar v London, Midland & Scottish Railway [1941] 1 All ER 172 Parker v SE Railway Railway [1930] 1 KB 41 Thompson v LM & S (1877) 2 CPD 416 Sugar Waltham Midland & Scottish Railway [1941] All ER Vine v v London,Forest Borough Council [2000] 4 All1ER 169 172 Thompson v LM & S Railway [1930] 1 KB 41 Vine v Waltham Forest Borough Council [2000] 4 All ER 169 Unusual terms Interfoto terms Library Ltd v Stiletto Visual Programmes Ltd [1988] 1 All ER 348 Unusual Picture Spurling v Bradshaw [1956] 1 WLR 461; [1956] 2 All ER 121 Interfoto Picture Lane Parking Stiletto Visual Programmes Ltd [1988] 1 All ER 348 Thornton v Shoe Library Ltd v Ltd [1971] 2 QB 163 Spurling v Bradshaw [1956] 1 WLR 461; [1956] 2 All ER 121 Thornton v Shoe Lane Parking Ltd [1971] 2 QB 163 - 43 - 43 CONTRACT LAW CONTRACT LAW
b) b)
HOLBORN COLLEGE c) Time of notice Olley v Marlborough Court Hotel [1949] 1 KB 532 d) Course of dealing
LLB
British Crane Hire Corporation v Ipswich Plant Hire [1975] QB 303; [1974] 1 All ER 1057 Henry Kendall v William Lillico [1968] 2 All ER 444 Hollier v Rambler Motors [1972] 2 QB 71; [1972] 2 WLR 401 McCutcheon v David MacBrayne [1964] 1 WLR 125; [1964] 1 All ER 430 e) Documents Chapelton v Barry UDC [1940] 1 KB 532 f) Effect of signature and misrepresentation Curtis v Chemical Cleaning Co [1951] 1 KB 805 LEstrange v Graucob [1934] 2 KB 394 CONSTRUCTION OF EXCLUSION CLAUSES a) Part written/part oral Couchman v Hill [1947] KB 54 Evans v Merzario Ltd [1976] 1 WLR 1078 b) Contra proferentem rule Wallis Son & Wells v Pratt & Haynes [1911] AC 394 c) Liability for negligence Alderslade v Hendon Laundry Ltd [1945] KB 189 Smith v South Wales Switchgear [1978] 1 WLR 165 d) Fundamental breach Ailsa Craig Fishing Co Ltd v Malvern Fishing Co [1983] 1 WLR 964; [1983] 1 All ER 101 George Mitchell Ltd v Finney Lock Seeds Ltd [1983] 2 AC 803; [1983] 2 All ER 737 Photo Productions v Securicor Transport [1980] AC 827; [1980] 1 All ER 556 (HL) Suisse Atlantique [1967] 1 AC 361
Articles
Adams Fundamental Breach Positively Last Appearance (1983) 46 MLR 771 Coote Pity the Poor Stevedore! [1981] CLJ 13 Palmer Limiting Liability for Negligence (1982) 45 MLR 322 Sealy Sale of Goods Reasonableness of Exemption Clause Under Yesterdays Law [1984] CLJ 29 Sealy Contract Farewell to the Doctrine of Fundamental Breach [1980] CLJ 252
Interrograms
1. What is a limitation clause? - 44 CONTRACT LAW
HOLBORN COLLEGE 2. 3. 4. 5. 6. 7. 8. 9. 10. What is an exclusion clause? How many ways can an exclusion clause be incorporated into a contract? Why was the exclusion clause not incorporated in Chapelton v Barry UDC? Was the exclusion clause incorporated in McCutcheon v David MacBrayne? Why were the exclusion clauses not incorporated in Thornton v Shoe Lane Parking?
LLB
Why was the exclusion clause not incorporated in Olley v Marlborough Court Hotel? Does the nature of the document containing the exclusion clause determine incorporation? Would railway tickets be considered contractual documents today? In Thornton v Shoe Lane Parking Denning MR said some clauses I have seen would need to be printed in red ink on the face of the document with a red hand pointing to it before the notice could be held to be sufficient. Explain this comment. What is the contra proferentem rule? Why did the clause not apply in Hollier v Rambler Motors? Why are there special considerations for the exclusion of negligence liability? What is the ratio decidendi of Suisse Atlantique? Can liability for a very serious breach be excluded by a carefully worded clause? Can liability for a fundamental breach be excluded by a carefully worded clause? Why were Securicor protected by the limitation clause in Photo Productions v Securicor? Why were Malvern Fishing protected by the limitation clause in Ailsa Craig Fishing v Malvern Fishing? Is Suisse Atlantique still good law? Why are limitation clauses in a contract between businessmen dealing at arms length encouraged?
11. 12. 13. 14. 15. 16. 17. 18. 19. 20.
Questions
See next unit
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CONTRACT LAW
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Part 2: Study Unit Ten Part 2: Study Unit Ten

Topic Topic Exclusion Clauses The Unfair Contract Terms Act 1977
Exclusion syllabus The Unfair Contract Terms Act 1977 Note: the Clauses takes account of relevant European Union legislation in the field of unfair contract terms. Note: the syllabus takes account of relevant European Union legislation in the field of unfair contract terms.
Prologue Prologue of exclusion clauses at statute is examined here. The effects of the recent Unfair The position
Terms in Consumer Contracts Regulations 1999 will also here. The effects of the recent Unfair The position of exclusion clauses at statute is examined be reviewed. Terms in Consumer Contracts Regulations 1999 will also be reviewed.
Essential Reading EssentialContract Law, Cracknell Relevant Chapter(s) Obligations: Reading

Other Reading Other ReadingMaterials, Beale, Bishop and Furmston Relevant Chapter(s) Contract, Cases and
Learning Outcomes Learning Outcomes scope of the Unfair Contract Terms Act 1977. a) To have understood the
a) b) c) b) c) d) d) e) e) To have understood the scope ofof businessContract Terms Act 1977.a consumer. examined the concepts the Unfair liability and dealing as To have examined the clauses are rendered totally ineffective by the a consumer. are learnt which concepts of business liability and dealing as Act and which made subject towhich clauses are rendered totally ineffective by the Act and which are To have learnt the requirement of reasonableness. To have examined requirement of reasonableness. made subject to thethe concept of reasonableness imposed by the Act. To have examined the concept ofof European Union law by the Act. particularly the have examined the impact reasonableness imposed in this area, Unfair Terms in Consumer Contracts Regulations 1999. in this area, particularly the To have examined the impact of European Union law Unfair Terms in Consumer Contracts Regulations 1999.
Sources of Law Sourcesand Regulations Statutes of Law

Statutes and Regulations Misrepresentation Act 1967: s3
Misrepresentation Act 1967: s3 Occupiers Liability Act 1984 Occupiers Liability1979:1984 Sale of Goods Act Act ss1215 Sale of Goods Act 1979: ss1215
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HOLBORN COLLEGE Unfair Contract Terms Act (UCTA) 1977: Parts I and III Unfair Terms in Consumer Contracts Regulations (1999)
LLB
Case Law
UNFAIR CONTRACT TERMS ACT 1977 a) Effect not form Phillips Products Ltd v Hyland [1987] 2 All ER 620 Thompson v T Lohan Ltd [1987] 2 All ER 631 b) Dealing as a consumer R & B Customs Brokers Co Ltd v United Dominion Trust Ltd [1988] 1 All ER 847 c) Reasonableness George Mitchell (Chesterhall) Ltd v Finney Lock Seeds [1983] 2 AC 803; [1983] 2 All ER 737 (HL) RW Green Ltd v Cade Bros [1978] 1 Lloyds Rep 602 St Albans City and District Council v International Computers Ltd [1996] 4 All ER 482 (CA) Stag Line v Tyne Ship Repair Group [1984] 2 Lloyds Rep 211 Smith v Eric S Bush [1989] 2 All ER 514 Stewart Gill Ltd v Horatio Myer [1992] 2 WLR 721; [1992] 2 All ER 257 UNFAIR TERMS IN CONSUMER CONTRACTS REGULATIONS 1999 Director General of Fair Trading v First National Bank [2001] 3 WLR 1297 Standard Bank v Apostolokis [2002] CLC 933
Articles
Beatson European Law and Unfair Terms in Consumer Contracts [1995] CLJ 235 Bradgate Unreasonable Standard Terms (1997) 60 MLR 582 Bright Winning the Battle Against Unfair Contract Terms (2000) LS 331 Brown and Chandler Unreasonableness and the Unfair Contract Terms Act (1993) 109 LQR 41 Dean The EC Directive on Unfair Terms in Consumer Contracts (1993) 56 MLR 581 Hedley Defective Software in the Court of Appeal [1997] CLJ 21 MacDonald The Council, the Computer and the Unfair Contract Terms Act 1977: St Albans DC v International Computers (1995) 58 MLR 585 Peel Making More Use of UCTA 1977: Stewart Gill Ltd v Horatio Myer and Co (1993) 56 MLR 98 Peel Reasonable Exemption Clauses (2001) 117 LQR 545 Reynolds Unfair Contract Terms (1994) 110 LQR 1 Sealy Unfair Contract Terms Act 1977 [1978] CLJ 15
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CONTRACT LAW
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LLB
The Unfair Terms in Consumer Contracts Regulations 1999 SLR Autumn 1999 (Vol 28) 8 (Student Law Review)
Report
Law Com No 166: Unfair Terms in Contracts
Interrograms
1. 2. 3. 4. 5. 6. 7. 8. 9. 10. 11. 12. 13. 14. 15. 16. 17. 18. 19. 20. What is a contract on written standard terms? What is a standard form contract? For the purposes of ss27 UCTA what is meant by business liability? Can a contracting party exclude liability for negligently injuring another party? Can a contracting party exclude liability for negligently damaging property of another party? What is meant by deals as a consumer? What section of UCTA defines deals as a consumer? Will a person bidding at an auction deal as a consumer? Will a child buying chocolate at a local shop deal as a consumer? Can a businessman exclude liability with a consumer for breach of contract? Can a contract on written standard terms ever exclude liability for breach? Can s12 Sale of Goods Act obligations be excluded by a contract term? As against a person dealing as a consumer, can ss13, 14 and 15 Sale of Goods Act obligations be excluded? Explain the effect of s8 UCTA on s3 of the Misrepresentation Act 1967. What is the effect of s9 UCTA? How does a court decide reasonableness? Where are the guidelines for application of the reasonableness test to be found? If a company like Securicor enter into a negotiated contract with a company like Photo Products will s3 UCTA apply? Why was the clause not upheld by the House of Lords in George Mitchell v Finney Lock Seeds? In what ways, if any, do the Unfair Terms in Consumer Contracts Regulations 1994 and 1999 give consumers better protection than the Unfair Contract Terms Act 1977?
Questions
1. K advertised in a local newspaper that he had a Sumpter 1997 car for sale for 7,200. The vehicle was described as in excellent condition. J went to the address which K had given. After a test drive J agreed to buy the car. Two days later, when Js wife was driving the car, a wheel came off; the car crashed through the window of a police station and J and his wife were injured. The agreement between K and J contained the following clauses. 22. It is agreed that K has not made any statement which has induced the contract.
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CONTRACT LAW
HOLBORN COLLEGE 23. The parties agree that there is no undertaking of quality or fitness for purpose. 24. There is a limit of 500 for damages for breach of contract by K. 25. There is no liability for consequential loss.
LLB
Advise J. What difference, if any, would it make to your advice if K had sold the car in the course of his business? 2. R, a car dealer, agreed to sell a car to S for 5,000 after S had examined the car on the garage forecourt. The document on the car windscreen indicated the price and in large letters said, All our cars are in tip top condition! Later in small print was a clause which read, we accept no legal responsibility for the condition of the vehicle. For terms of sale see the notice in the office and the details in the sale agreement. In the office, where there was a large notice on the wall indicating all the major provisions, S signed the agreement to purchase the car. It contained the following provisions: It is agreed that there is no warranty, condition, or statement about the condition of the car and that no statement was made which persuaded the purchaser to enter into the contract. It is agreed that the maximum damages payable for breach of contract shall be 2,500. There is no express term, implied term (statutory or otherwise) or warranty or statement about the vehicle which is to have any legal effect. There is no promise about the condition of the vehicle. Two days later, when Ss wife was driving the car which S had given to her as a birthday present, the car crashed because the brakes were defective. Mrs S was injured and off work for six months causing her to lose 14,000 in wages. The car was a writeoff. Advise S. 3. Urban, a window cleaner, hired a ladder from Vitus Equipment Hire Ltd to use while painting the outside of his house. He paid a deposit of 20 and was given a receipt on which was stated: Conditions of hire. Vitus accepts no responsibility for any loss or damage suffered as a result of the use of the equipment. Hirers use the equipment at their own risk. Because of a defective rung on the ladder, Urban fell off it and landed on an expensive radio that he was listening to while he worked. Urban suffered a broken and leg and the radio was badly damaged. Advise Urban. How would your answer differ if he had hired the ladder for use in cleaning windows and had been doing that when the accident happened? 4. Last May Gavin, an estate agent, bought a coffee machine for his office and a freezer for his home from Omnivend Stores. Gavin placed the orders by telephone. When the goods were delivered Gavin was in each case given a sales note, on which it was stated that the goods were guaranteed by Omnivend against all defects notified in the first six months from the date of delivery but that, apart from that, Omnivend accepted no liability for any loss or damage, however caused. In August the coffee machine overheated and exploded: Gavin was badly scalded and was off work for three weeks. Soon afterwards the freezer developed a fault with the result that 200 worth of frozen meat thawed out and had to be thrown away. Advise Gavin.
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CONTRACT LAW
HOLBORN COLLEGE 5.
LLB
K was a car dealer, who advertised his 1990 Sierra for sale for 5,500. He said that the car had travelled 35,000 miles with only one owner. L, a mini cab driver, saw the car, and K said to L, It is a good little bus. Id buy it if I were you. L agreed to purchase the vehicle for 5,500. The agreement contained the following clauses. (13) It is agreed that no statements made by K to L influenced the making of the contract. (14) There is no warranty, guarantee or undertaking about the fitness of the vehicle. (15) No implied condition or warranty, statutory or otherwise, is to be implied into the contract. (16) There is no liability for breach of contract, fundamental or otherwise. Three days after L took the car the brake system failed and L and his fare paying passenger were injured. Advise K. What difference, if any, would it make to your advice if K had been a private individual selling the car?
6.
Sarah owned a small engineering business and recently bought a new Ford Mondeo. She bought it from Mr Patels Garage, and she purchased it for both business and private use. The contract of sale excluded the implied terms in the Sale of Goods Act 1979. Sarah went on a touring holiday in the car with her husband Adnan. The car kept on breaking down. Sarah then booked into The Shish Mahal Hotel, which was part of a national chain. Whilst there Sarahs laptop was stolen from their room which was locked. She complained, and on doing so was referred to the booking conditions that she had been given at reception. On the back it said, no liability is accepted for loss or damage to items not deposited in the safe. Sarah had not read the conditions. Adnan hired two deckchairs from the Council and was given a ticket which stipulated on the front no liability for injury. When Adnan sat on his chair it collapsed due to a defect and he was injured. Advise Sarah and Adnan of any actions they may have in Civil Law
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CONTRACT LAW
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Part 2: Study Unit Eleven Part 2: Study Unit Eleven

Topic
Misrepresentation Topic Misrepresentation
Prologue
What constitutes an actionable misrepresentation Prologue misrepresentation, and their respective remedies in What constitutes an actionable misrepresentation examined in this unit. misrepresentation, and their respective remedies in examined in this unit.
in law? The both common in law? The both common
different categories law and statute will different categories law and statute will
of be of be
Essential Reading
Obligations: Contract Law, Cracknell Relevant Chapter(s) Essential Reading Textbook on Contract Law RelevantChapter(s)Chapter(s) Contract Law, McKendrick Relevant Relevant Obligations: Contract Law, Cracknell Chapter(s) Contract Law, McKendrick Relevant Chapter(s)
Other Reading
Contract,ReadingMaterials, Beale, Bishop and Furmston Relevant Chapter(s) Other Cases and The Law of Contract,Materials,Relevant Chapter(s)Furmston Relevant Chapter(s) Contract, Cases and Treitel Beale, Bishop and The Law of Contract, Treitel Relevant Chapter(s) Contract Law, McKendrick Relevant Chapter(s)
Learning Outcomes
b) a) c) b) c) d) e) d) e)
a) To have understood what Learning Outcomes constitutes an actionable misrepresentation in law. To be able to differentiate between the different types of misrepresentation. To have understood what constitutes an actionable misrepresentation in law. To have learnt the equitable remedy of recission, the bars to recission and the concept To be able to differentiate between the different types of misrepresentation. of a voidable contract. To have learnt the equitable remedy of recission, the bars to recission and the concept To have examined the scope and operation of the Misrepresentation Act 1967. of a voidable contract. To have examined contracts uberrimae fidei (of the utmost good faith). To have examined the scope and operation of the Misrepresentation Act 1967. To have examined contracts uberrimae fidei (of the utmost good faith).
Sources of Law
Statute Sources of Law
Misrepresentation Act 1967 Statute Misrepresentation Act 1967
Case Law
NATURE OF STATEMENT Case Law a) Fact not law NATURE OF STATEMENT Andre et Cie v Ets Michel Blanc [1977] 2 Lloyds Rep 166 a) Fact not law Pankhania v London Borough of Hackney [2002] NPC 123 Andre et Cie v Ets Michel Blanc [1977] 2 Lloyds Rep 166 Pankhania v London Borough of Hackney [2002] NPC 123 UNDERGRADUATE PROGRAMME UNDERGRADUATE PROGRAMME - 51 - 51 CONTRACT LAW CONTRACT LAW
HOLBORN COLLEGE b) Fact not opinion BG plc v Nelson Group Services (Maintenance Ltd) (unreported April 2002) Bissett v Wilkinson [1927] AC 177 Brown v Raphael [1958] Ch 636 Dimmock v Hallett (1866) LR 2 Ch App 21 Smith v Land & House Property Corp (1884) 28 Ch D 7 c) Fact not intention Edgington v Fitzmaurice (1885) 29 Ch D 459 d) Representation falsified by subsequent events Spice Girls Ltd v Aprilla World Service BV [2000] EMLR 478 With v OFlanagan [1936] Ch 575 INDUCEMENT TO CONTRACT a) No reliance on own investigations Attwood v Small (1838) 6 Cl and F 232 b) Means of verification irrelevant Redgrave v Hurd (1881) 20 Ch D 1 c) Extent of reliance Edgington v Fitzmaurice (above) JEB Fasteners v Marks, Bloom and Co [1983] 1 All ER 583 d) Materiality Museprime Properties v Adhill Properties [1990] 36 EG 114 FRAUDULENT MISREPRESENTATION Derry v Peek (1889) 14 App Cas 337 Goose v Wilson Sandford (No 2) [2001] Lloyds Rep PN 189 NEGLIGENT MISREPRESENTATION AT COMMON LAW Hedley Byrne v Heller Partners [1964] AC 465; [1963] 2 All ER 575 (HL) MISREPRESENTATION ACT 1967 Howard Marine v Ogden & Sons [1978] QB 574 REMEDIES: DAMAGES a) Fraudulent misrepresentation Chef Aquitaine SARL v Laporte Materials (Barrow) Ltd [2000] 3 All ER 493 (CA) Downs v Chappell [1996] 3 All ER 344 (CA) Doyle v Olby (Ironmongers) [1969] 2 QB 158 East v Maurer [1991] 2 All ER 733 Smith New Court Securities Ltd v Citibank NA [1997] AC 254 (HL) Standard Chartered Bank v Pakistan Shipping Corpn (No 2) [2002] 3 WLR 1547
LLB
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CONTRACT LAW
HOLBORN COLLEGE b) Negligent misrepresentation at common law Esso Petroleum Co Ltd v Mardon [1976] QB 801 c) Misrepresentation Act 1967
LLB
Floods of Queensferry v Shand Construction (No 3) [2000] BLR 81 Royscot Trust v Rogerson [1991] 3 WLR 57; [1991] 3 All ER 294 Sindall (William) v Cambridgeshire CC [1994] 1 WLR 1016; [1994] 3 All ER 932 (CA) Zanzibar v British Aerospace [2000] 1 WLR 2333 REMEDIES: RESCISSION Car & Universal Finance v Caldwell [1965] 1 QB 525 LIMITS TO RESCISSION Leaf v International Galleries [1950] 2 KB 86 Lewis v Averay [1972] 1 QB 198 Long v Lloyd [1958] 1 WLR 753 Peyman v Lanjani [1985] Ch 457; [1984] 3 All ER 703 Vadasz v Pioneer Concrete Ltd (1995) 130 ALR 570 (Australia) REMEDIES: INDEMNITY Whittington v Seale Hayne (1900) 82 LT 49 MISREPRESENTATION AND EXCLUSION CLAUSES EA Grimstead v McGarrigan [1998-99] Info TLR 384 (Noted (2002) NLJ 1898) Thomas Witter v TBP Industries [1996] 2 All ER 573 Watford Electronics v Sanderson [2001] 1 All ER (Comm) 696
Articles
Beale Points on Misrepresentation (1995) 111 LQR 385 Beale Damages in Lieu of Rescission for Misrepresentation: Sindall (William) v Cambridgeshire CC (1995) 111 LQR 61 Ferguson Partial Rescission for Misrepresentation Rejected: TSB Bank plc v Camfield (1995) 111 LQR 555 Malet Section 2(2) of the Misrepresentation Act 1967 (2001) 117 LQR 545 Oakley Rescission Ab Initio for Mistake and Misrepresentation: Sindall (William) v Cambridgeshire CC [1995] CLJ 17 OSullivan Partial Rescission for Misrepresentation in Australia (1997) 113 LQR 16 OSullivan Remedies for Misrepresentation: Up in the Air Again [2001] CLJ 239 Payne Measure of Damages for Fraudulent Misrepresentation [1997] CLJ 17
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HOLBORN COLLEGE
LLB
Interrograms
1. 2. 3. 4. 5. 6. 7. 8. 9. 10. 11. 12. 13. 14. 15. 16. 17. 18. What is a representation? What is a misrepresentation? Is a statement of opinion a representation? Is a misrepresentation of law actionable? Can an action for misrepresentation be brought where the misrepresentation is one of silence? In what circumstances does English law impose a duty to disclose facts? What does uberimae fidei mean? Explain the case of Attwood v Small. What is a fraudulent misrepresentation? What is the liability created by s2(1) of the Misrepresentation Act? Under s2(1) does the plaintiff have to prove negligence or does the defendant have to disprove negligence? What is the fiction of fraud set up by s2(1)? What change in the law was made by s2(2) of the Act? What types of misrepresentation give rise to the possibility of rescinding the contract? What are the bars to recission? If damages are awarded under s2(1) of the Act, on what scale are they measured contractual or tortious? Explain the ratio decidendi of Howard Marine v Ogden & Sons. If the court decides to award damages under s2(2) of the Act, on what scale are they measured?
Questions
1. Tom is the chairman of Macro Ltd a company which designs computer software. Tom, who needs more staff, interviews Sadie. During the interview Sadie asks Tom how the company is doing and Tome replies In my opinion we are doing phenomenally well and will be declaring huge dividends at the next year end. Sadie is offered the job and accepts. On the strength of Toms comments Sadie invests her savings in Macro shares. Soon afterwards Macro gets caught up in a copywright dispute which prevents it from launching its latest software. Shortly after the company collapses. Discuss 2. Ahmed and Co, who are auctioneers, auctioned an area of land described in the particulars of sale as A prime site in the middle of a rapidly growing industrial zone. Patel, who was looking for a new site for a factory, bid for the site and his bid was accepted. After signing a document confirming the sale, Patel discovered that the site was designated as one of outstanding beauty for which planning permission waould not be available. He is now refusing to go ahead with the purchase. The document signed by Patel repeated a provision in the particulars of sale which he read prior to the auction stating no error, misstatement or omission in these particulars shall
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CONTRACT LAW
HOLBORN COLLEGE
LLB
annul the sale nor has the purchaser relied on any representation regarding the subject matter of the contract. Advise Patel. 3. It is very difficult to distinguish between law, fact and opinion. Discuss the validity of this assertion.
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CONTRACT LAW
LLB LLB
Part 2: Study Unit Twelve Part 2: Study Unit Twelve

Topic Topic
Mistake Mistake
Prologue Prologue
Mistake at common law looks at how a mistake made by one or both parties will affect the Mistake at common law looks at howtypes of mistakes by one or both parties will affect and contract. It also analyses the different a mistake made and the distinction between void the contract. contracts. voidable It also analyses the different types of mistakes and the distinction between void and voidable contracts.
Obligations: Contract Law, Cracknell Relevant Chapter(s) Textbook on Contract Law Cracknell Chapter(s) Chapter(s) Obligations: Contract Law, Relevant Relevant Contract Law, McKendrick Relevant Chapter(s) Contract Law, McKendrick Relevant Chapter(s)
Essential Reading Essential Reading
Other Reading Other Reading
Contract, Cases and Materials, Beale, Bishop and Furmston Relevant Chapter(s) Contract, Cases and Materials, Beale, Bishop and Furmston Relevant Chapter(s) The Law of Contract, Treitel Relevant Chapter(s) The Law of Contract, Treitel Relevant Chapter(s) Contract Law, McKendrick Relevant Chapter(s)
Learning Outcomes Learning Outcomes

a) a) b) b) c) c)
d) d) e) e)
To have understood when a mistake made by one party or both parties will affect the To have understood when a mistake made by one party or both parties will affect the contract. contract. To have examined the case law on the common law effect of mistake. To have examined the case law on the common law effect of mistake. To have learned the effect of a mistake on a contract and to understand the concept of a To have learned void contract. the effect of a mistake on a contract and to understand the concept of a void contract. To have analysed Lord Atkins judgment in Bell v Lever Bros. To have analysed Lord Atkins judgment in Bell v Lever Bros. To have examined the scope of the defence of non est factum. To have examined the scope of the defence of non est factum.
Sources of Law Sources of Law

Statute Statute
Sale of Goods Act 1979: s6 Sale of Goods Act 1979: s6
Case Law Case Law
UNILATERAL MISTAKE UNILATERAL MISTAKE a) Mistake as to person a) Mistake as to person Citibank v Brown Shipley [1991] 2 All ER 690 Citibank v Brown Shipley [1991] 2 All ER 690
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HOLBORN COLLEGE Cundy v Lindsay (1878) 3 App Cas 459 Kings Norton Metal v Edridge Merritt & Co (1897) 14 TLR 98 b) Mistake as to person inter praesentes Ingram v Little [1961] 1 QB 31 Lake v Simmons [1927] AC 487 Lewis v Averay [1972] 1 QB 198 Phillips v Brooks [1919] 2 KB 243 Shogun Finance v Hudson [2002] QB 834 c) Mistake as to subject matter Raffles v Wichelhaus (1864) 2 H & C 906 Scriven v Hindley [1913] 3 KB 864 d) Mistake as to terms Clarion Ltd v National Provident Institution [2000] 2 All ER 265 Hartog v Colin & Shields [1939] 3 All ER 506 e) Mistake as to quality Smith v Hughes (1871) LR 6 QB 597 BILATERAL MISTAKE a) Mistake as to quality Associated Japanese Bank Ltd v Credit du Nord SA [1988] 3 All ER 902 Bell v Lever Bros [1932] AC 161 Great Peace Shipping v Tsavliris Salvage (International) [2002] 3 WLR 1617 Harrison & Jones v Bunten & Lancaster [1953] 1 QB 646 Leaf v International Galleries [1950] 2 KB 86 Nicholson & Venn v Smith Marriott (1947) 177 LT 189 b) Mistake as to existence of subject matter Barrow Lane & Ballard v Phillips [1929] 1 KB 574 Couturier v Hastie (1856) 5 HL Cas 673 Galloway v Galloway (1914) 30 TLR 531 McRae v Commonwealth Disposals Commission (1950) 84 CLR 377 Scott v Coulson [1903] 2 Ch 249 c) Mistake as to title Bell v Lever Bros (above) Cooper v Phibbs (1867) LR 2 HL 149 d) Mistake as to the possibility of performing the contract Sheik Bros v Ochsner [1957] AC 136 NON EST FACTUM
LLB
Gallie v Lee [1971] AC 1004 (HL) Gillman v Gillman (1946) 174 LT 272 Lewis v Clay (1898) 67 LJQB 224 Norwich & Peterborough Building Society v Steed [1992] 3 WLR 669; [1993] 1 All ER 330 (CA)
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CONTRACT LAW
HOLBORN COLLEGE
LLB
Articles
Cartwright Common Mistake in Common Law and in Equity (2002) 118 LQR 196
Interrograms
1. 2. 3. 4. 5. 6. 7. 8. 9. 10. 11. 12. 13. 14. 15. 16. 17. 18. 19. 20. What is the difference between a void contract and a voidable contract? Will a mistake as to quality generally have any effect on the contract? What was the mistake in Bell v Lever Bros? Explain the ratio decidendi of Bell v Lever Bros. Why did Leaf have no remedies open to him in Leaf v International Galleries? Why was the contract in Nicholson & Venn v Smith Marriott void? In Couturier v Hastie, did the House of Lords base their decision on the effect of the mistake? Why was the contract in McRae v Commonwealth Disposals Commission not void? What is the effect of s6 of the Sale of Goods Act 1979? Why was the contract void in Cundy v Lindsay? Will a mistake as to credit worthiness generally affect the contract? What is meant by a mistake inter praesentes? What steps did Phillips take to establish the identity of Sir George Bullough (Phillips v Brooks (1919))? Distinguish Lewis v Averay from Ingram v Little. Is Ingram v Little still good law today? Why was there no contract between the parties in Raffles v Wichelhaus? Why was there no contract in Boulton v Jones? What is meant by the expression the mistake must be operative? What is meant by the expression fundamental in the context of mistake? What was the mistake of law rule and what is the effect on it of Kleinworth Benson v Lincoln City Council (a point considered further in unit 22).
Questions
Note: some questions may raise issues involving misrepresentation (see unit 11). 1. Where both parties enter into a contract in the belief that certain assumed facts are true, and it turns out that they are not true, the contract is void for mistake. To what extent is this an accurate statement of the law? 2. a) X Ltd owned a disused warehouse which was built in the early nineteenth century. X Ltd entered into a contract for the sale of the warehouse to Y Ltd, knowing that Y Ltd intended to demolish the warehouse and build offices on the site. Unknown to either X Ltd or Y Ltd, however, the warehouse was, shortly before the conclusion of the contract, listed as being of outstanding historic importance, so that it became unlawful to demolish it. Advise Y Ltd.
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CONTRACT LAW
HOLBORN COLLEGE b)
LLB
S Ltd agreed to sell to T Ltd 500 tons of peanuts now on board the SS City of Plains en route from New York to London. When the City of Plains docked in London it was discovered that the peanuts had never been shipped. The market price of peanuts has risen sharply since the contract was made. Advise T Ltd, which has suffered heavy losses because of the non-delivery of the peanuts.
3.
A common mistake has no effect whatsoever at common law unless it is such as to eliminate the very subject-matter of the agreement, in other words, unless it empties the agreement of all content. (Cheshire and Fifoot) Discuss, with reference to decided cases.
4.
a)
Roger, who closely resembled the well known politician Mr Tony Benn, went into a camera shop in London and selected a camera priced at 600. The shopkeeper, Simon, said, Hello, Mr Benn, I thought the press treated you disgracefully during your election campaign. As it is you, Ill let you have that camera for 500. Roger smiled and said that he did not have his chequebook with him. Simon said, Dont worry, Ill send the bill to you at the House of Commons. Roger took the camera away and later that day pawned it to Peter. Simon later managed to trace it back to Peter. Advise Simon.
b)
Hammer, an auctioneer, sold a collection of paintings by auction. Each painting was fully described in the catalogue. When Hammer invited bids for Lot 15 described as Country Scene, artist unknown his assistant Mallet inadvertently held up Lot 16 instead for the bidders to see. Lot 16 was described in the catalogue as Village Life, (?) school of Brushman, but Sickle, who was sitting in the front row, immediately recognised it as a lost masterpiece by Brushman himself. No other bidders noticed Mallets error and Sickles bid of 25 was accepted by Hammer. When Hammer realised what had happened he refused to let Sickle have the painting, which is worth 5,000. Advise Sickle.
5.
a)
Mistake as to the attributes of the other contracting party does not make the contract void. Explain and comment.
b)
M walks into Ns art gallery and expresses interest in a painting for sale at 10,000. M says she would like to have that painting and tells N that she is Lady Cynthia Warburton and that she represents the well-known firm of Warburton & Co Ltd. M produces a cheque book with Warburton & Co Ltds name on it (which she had stolen earlier that day) and N allows her to take the painting away in return for a cheque signed by her on behalf of Warburton & Co Ltd. The cheque has now been dishonoured and M has disappeared, after selling the painting to O for 9,500. Advise N.
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CONTRACT LAW
HOLBORN COLLEGE 6. a)
LLB
Mistake is said to negative consent when it leads to a misunderstanding between the parties, so that they are at cross purposes It cannot be too strongly emphasised that in this type of case a mistake will not normally affect the validity of the contract at all the mistake will only impair the validity of the contract in a number of somewhat exceptional situations. (Treitel) Explain and illustrate the above passage with reference to the relevant case law.
b)
A computer firm with whom he has had previous dealings writes to Professor A Higgins, University of Life, offering a consultancy contract worth 5,000. The letter is forwarded to Professor Albert Higgins in the Faculty of Science. In fact the firm had meant it to go to Professor Andrew Higgins in the Faculty of Technology. Albert Higgins replies accepting the offer but the firm are now refusing to honour it. Advise him.
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CONTRACT LAW
LLB LLB
Part 2: Study Unit Thirteen Part 2: Study Unit Thirteen

Topic Topic Incapacity Minors Liability
Incapacity Minors Liability
Prologue Prologue Incapacity minors
liability examines the exceptions to the general rule that the law presumes everyone has legal capacity to contract. Incapacity minors liability examines the exceptions to the general rule that the law presumes everyone has legal capacity to contract.
Essential Reading Essential Reading Obligations: Contract Law, Cracknell Relevant Chapter(s)
Other Reading Other Cases and Contract,ReadingMaterials, Beale, Bishop and Furmston Relevant Chapter(s)
Learning Outcomes Learning Outcomes effect of the Minors Contracts Act 1987. a) To have examined the
b) a) c) b) d) c) d) understood the concept of Minors Contracts Act 1987. To have examined the effect of the necessaries. To have learnt the effectconceptlaw necessaries.contracts of employment. understood the of the of on minors group contracts voidable at common law. To have learnt the effect of the law on minors contracts of employment. To have learnt the group of contracts voidable at common law.
Statutes Minors Contracts Act 1987

MinorsGoods Act Act 1987 Sale of Contracts 1979: s3 Sale of Goods Act 1979: 1969: s1 Family Law Reform Act s3 Family Law Reform Act 1969: s1
Case Law Case CONTRACTS VALID Law

a)ALID Necessary goods V CONTRACTS a) Fawcett v Smethurst (1914) 84 LJ KB 473 Necessary goods Nash v Inman [1908] 2 KB 1 Fawcett v Smethurst (1914) 84 LJ KB 473 Nash v Inman [1908] 2 KB 1 - 61 - 61 CONTRACT LAW CONTRACT LAW
HOLBORN COLLEGE b) Necessary services Chapple v Cooper (1844) 13 M & W 252 Roberts v Gray [1913] 1 KB 520 c) Employment contracts Chaplin v Leslie Frewin [1966] AC 71 Clements v L & NW Railway [1894] 2 QB 482 De Francesco v Barnum (1890) 45 Ch D 430 Doyle v White City Stadium [1935] 1 KB 110 d) Trading contracts Cowern v Nield [1912] 2 KB 419 VOIDABLE CONTRACTS (IE: VALID UNTIL REPUDIATED) Steinberg v Scala (Leeds) Ltd [1923] 2 Ch 452 LIABILITY IN TORT Ballett v Mingay [1943] KB 286 Fawcett v Smethurst (above)
LLB
Interrograms
1. 2. 3. 4. 5. 6. 7. 8. 9. 10. 11. 12. 13. 14. 15. 16. 17. What is the present age of majority? What two principles are involved in the legal intervention in minors contracts? Is a contract for necessaries valid? Explain the effect of the Minors Contracts Act 1987. Can the purchase of a ring to give as a gift to a friend be a necessary? Why did the tailors action fail in Nash v Inman? What price must an infant pay for necessary items? Explain the effect of s3(2) and s3(3) of the Sale of Goods Act 1979. Can minors be sued on executory contracts? Why was the contract in De Francesco v Barnum not binding? Why was the contract in Doyle v White City Stadium binding? Why was the contract in Chaplin v Leslie Frewin (Publishers) binding? What are the four types of contract that are voidable when entered into with an infant? Can an infant repudiate a contract to lease land? Is a contract to own shares in a company binding on an infant? What is the effect of repudiation before reaching full capacity? On reaching full age when must a person decide to repudiate the contract?
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CONTRACT LAW
HOLBORN COLLEGE
LLB
Questions
1. In March Harvey promised his 17-year-old son Tim 500 if he obtained high grades in his forthcoming A level examinations and was able to take up the place at medical school which had been offered to him conditionally upon his attaining specified grades. In May Tim felt that his revision was going badly, and he agreed with Swift Progress Ltd to take a 20 week correspondence course in How to Improve Your Concentration, paying a deposit of 50 and agreeing to pay a further 10 each week for the duration of the course. He also bought on credit an Encyclopaedia of Basic Medical Science worth 25 and a second-hand motor cycle for 225, the price being payable in five equal instalments over 10 months. Tim is now dissatisfied with all these transactions. He has only made one weekly payment to Swift Progress Ltd and only paid one instalment on the motor cycle. He has not paid anything for the Encyclopaedia. He knows that his A levels have been disappointing and that he will probably not obtain the necessary grades when the results are announced in August. Advise Tim. 2. Linda left school last year at the age of 16. She took a job as a trainee kitchen assistant in an hotel. Her wages are 20 a week, and she is required to give three months notice to terminate her employment. She recently agreed to buy an Osaka motorcycle so that she could spend more time with her boyfriend Malcolm, who is mad about motorcycles. She also signed a written agreement to buy a one quarter share in a racing greyhound called Dingo. Linda has now been offered a job as a cook in a restaurant at 60 a week, provided she can start immediately. She has failed to pay for the motorcycle or the share in Dingo. Advise Linda. 3. Adam, who is seventeen years old, entered into the following contracts: a) b) c) he bought a Maserati sports car price 15,000; he enrolled for an evening course in How to be a racing driver (price 300); he agreed to work for one year on Saturdays and Sundays as a waiter at the Lotus Blossom Restaurant at a wage of 10 per week.
Adam gave up the course after three weeks and left the Lotus Blossom after a month. He has not paid either for the car or the course. Advise Adam as to his legal liabilities, if any. 4. Linda is seventeen years old and a first year student of fashion design. Believing it would help her with her studies she enrolled for a series of lessons at a private modelling school for a fee of 200. She also purchased a de luxe sewing machine for 300 and, at the suggestion of her tutor Melvyn, bought 100 shares from Melvyn in a company run by Melvyns wife, Norma, which manufactures handbags. Linda has now given up the modelling lessons. She failed to pay the 200 and the school is demanding payment. Linda would also like to cancel the transactions concerning the sewing machine and the shares, and have her money back. Advise Linda.
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CONTRACT LAW
HOLBORN COLLEGE 5.
LLB
Referring to infants contracts it has been said that The law on this topic is based on two principles. The first, and more important, is that the law must protect the infant against his own inexperience, the second principle is that the law should not cause unnecessary hardship to adults who deal fairly with infants. (Treitel) Explain how the law gives effect to these principles and consider how, if necessary, the law might usefully be reformed.
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CONTRACT LAW
LLB LLB
Part 2: Study Unit Fourteen Part 2: Study Unit Fourteen

Topic Topic Duress and Undue Influence
Duress and Undue Influence
Prologue Prologue This topic examines
the effects of duress and undue influence on the enforceability of
contracts. This topic examines the effects of duress and undue influence on the enforceability of contracts.
Learning Outcomes Learning Outcomes scope of duress at common law. a) To have examined the
b) a) b) undue at common equity. To have examined the scope of duressinfluence in law. To have examined the scope of undue influence in equity.

Case Law Duress
Alf Vaughan & Co Ltd (In Receivership) v Royscot Trust plc [1999] 1 All ER (Comm) 856 Duress Atlas Express v Kafco Ltd [1989] 1 All ER 641 Alf Vaughan & Co Ltd (In Receivership) v Royscot Trust plc [1999] 1 All ER (Comm) 856 B & S Contracts v Green [1984] ICR 419 Atlas Express v Kafco Ltd [1989] 1 All ER 641 CTN Cash & Carry Ltd v Gallaher Ltd [1994] 4 All ER 714 (CA) B & S Contracts v Green [1984] ICR 419 Dimskal Shipping v ITF [1991] 4 All ER 871 CTN Cash & Carry Ltd v Gallaher Ltd [1994] 4 All ER 714 (CA) DSND Subsea v Petroleum Geo Services ASA [2000] BLR 530 Dimskal Shipping v ITF [1991] 4 All ER 871 North Ocean Shipping v Hyundai Construction (The Atlantic Baron) [1979] QB 705 DSND Subsea v Petroleum Geo Services ASA [2000] BLR 530 Occidental Worldwide Investment Corp v Skibs A/S Avanti (The Sibeon and the Sibotre) North Ocean Shipping v Hyundai Construction (The Atlantic Baron) [1979] QB 705 [1976] 1 Lloyds Rep 293 Occidental Worldwide Investment Corp v Skibs A/S Avanti (The Sibeon and the Sibotre) Pao On v Lau Yiu Long [1980] AC 614; [1979] 3 All ER 65 (PC) [1976] 1 Lloyds Rep 293 Universe Tankships v ITF [1982] 2 All ER 67 Pao On v Lau Yiu Long [1980] AC 614; [1979] 3 All ER 65 (PC) Vantage Navigation v Suhail Saud & Bahwan [1989] 1 Lloyds Rep 138 Universe Tankships v ITF [1982] 2 All ER 67 Vantage Navigation v Suhail Saud & Bahwan [1989] 1 Lloyds Rep 138
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HOLBORN COLLEGE UNDUE INFLUENCE a) Express influence Williams v Bayley (1886) LR 1 HL 200 b) Presumed influence
LLB
Barclays Bank v OBrien [1994] 1 AC 180; [1993] 3 WLR 786; [1993] 4 All ER 417 (HL) CIBC Mortgages v Pitt [1994] 1 AC 200; [1993] 3 WLR 802; [1993] 4 All ER 433 Coldunell v Gallon [1986] QB 1184 Goldsworthy v Brickell [1987] 1 All ER 853 Naidoo and Another v Naidu and Others (2000) The Times 1 November National Westminster Bank v Amin [2002] 1 FLR 735 National Westminster Bank v Morgan [1985] 1 All ER 821 Royal Bank of Scotland plc v Etridge (No 2) [2002] 2 AC 773 c) Rebutting the presumption Hammond v Osborn [2002] WTLR 1125 Inche Noriah v Shaik Allie bin Omar [1929] AC 127 HARSH AND UNCONSCIONABLE BARGAINS Barclays Bank v Schwartz [1995] TLR 452 (CA) Cresswell v Potter [1978] 1 WLR 255 INEQUALITY OF BARGAINING POWER Avon Finance v Bridger [1985] 2 All ER 281 (CA) Lloyds Bank v Bundy [1975] QB 326 National Westminister Bank v Morgan [1985] 1 All ER 821
Articles
Andrews Undue Influence Wheres the Disadvantage? [2002] Conv 456 Bigwood Undue Influence in the House of Lords: Principles and Proof (2002) MLR 435 Capper Undue Influence and Unconscionability: A Rationalisation (1998) 114 LQR 479 Dixon Looking Up a Remedy for Inequitable Conduct [1993] CLJ 232 Heydon Equitable Compensation for Undue Influence (1997) 113 LQR 8 Mee Undue Influence, Misrepresentation and the Doctrine of Notice: OBrien [1995] CLJ 536 OSullivan Developing OBrien (2002) 118 LQR 337 Smith Contracting Under Pressure: A Theory of Duress [1997] CLJ 343 Thompson Wives, Sureties and Banks [2002] Conv 174 Tiplady The Limits of Undue Influence (1985) 48 MLR 579
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CONTRACT LAW
HOLBORN COLLEGE
LLB
Interrograms
1. 2. 3. 4. 5. 6. 7. 8. 9. 10. 11. 12. If a contract was made under duress is it voidable, or void at common law? What is now meant by duress? What was the duress in The Atlantic Baron? Why was relief not granted in The Atlantic Baron? Was there duress in Pao On? What is meant by undue influence? Give examples of types of special relationship that would give rise to a presumption of undue influence. Why was the mortgage not enforceable in Lloyds Bank v Bundy? What is meant by inequality of bargaining power? Is it per se a ground of challenge to a contract? What is the effect of the Court of Appeal decision in Goldsworthy v Brickell? After Etridge (No 2) what must a claimant do in order to raise the presumption of undue influence? When will a bank be placed on notice of the potential existence of undue influence?
Questions
1. Millicent, who is a member of a modern sect known as Liblib persuades her husband, Claude, to join. Claude soon becomes dominated by Andronia, the leader of the sect, part of whose teaching is that a husband is in all ways inferior to his wife. Andronia persuades Claude to hand over his manor to the sect as their headquarters. Millicent then persuades Claude to transfer to her all his stocks and shares. Six months after these events, Millicent leaves Claude and at the same time Andronia tells Claude to leave the manor, which he does. Now, one year later, Claude hears that Andronia has put the manor up for sale. Advise Claude, who is penniless, as to his legal rights, if any. a) b) In what circumstances will the law permit contracts obtained by improper pressure to be set aside? Charles, intending to benefit his niece Claudia, offers to sell her his rare collection of stamps for 15,000. Adam, Charles nephew, is furious when he hears of this. Adam takes Charles a written contract of sale made out between himself and Charles and tells Charles that it is the agreement between Charles and Claudia. Charles, not feeling very well, and having forgotten his glasses, signs the paper and accepts Adams offer to bank a cheque for 15,000, made out by Adam, but which Charles believes to be Claudias payment for the collection. Adam has since sold the collection for 40,000 and Charles and Claudia have just discovered the truth. Advise Charles as to his legal rights, if any. 3. a) Economic pressure is what contractual negotiations are all about: it is futile for the courts to try to intervene. Discuss. b) R is a strong-willed and domineering woman. S, the man with whom she lived, left all financial decisions to her. Last year S inherited a holiday apartment in
2.
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CONTRACT LAW
HOLBORN COLLEGE
LLB
Spain from his aunt A. R insisted that S signed an agreement giving R the exclusive use of the apartment and the right to receive all rent from lettings in exchange for Rs shares in X & Y plc. R and S have now separated. S wants to go and live in the apartment but R will not permit him to use the apartment. The shares in X & Y plc have increased in value. Advise S.
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CONTRACT LAW
LLB LLB
Part 2: Study Unit Fifteen Part 2: Study Unit Fifteen

Topic Illegality Topic
Illegality
Prologue Illegality examines another element that is capable of declaring a contract void. It also looks Prologue
at the circumstances in which a contract is declared illegal. Illegality examines another element that is capable of declaring a contract void. It also looks at the circumstances in which a contract is declared illegal.
Learning Outcomes a) To have learnt the various Learning Outcomes types of illegality that may affect a contract.
b) a) c) b) d) c) d) To have examined the effect of of illegality on may affect a contract. To have learnt the various typespublic policythatthis area of the law. To have understood the consequences of illegality onarea of the law. To have examined the effect of public policy on this a contract. To have understood the circumstances of illegality courtcontract. recovery of property To have examined the consequences where the on a will allow passed under an illegal contract. To have examined the circumstances where the court will allow recovery of property passed under an illegal contract.
Sources of Law Sources Statute of Law
Law Reform (Miscellaneous Provisions Act) 1970: s1 Statute Law Reform (Miscellaneous Provisions Act) 1970: s1 s22(1) Sale of Goods Act 1979 (sale Note: s1 Sale of Goods (Amendment) Act 1994 repeals in market overt). Note: s1 Sale of Goods (Amendment) Act 1994 repeals s22(1) Sale of Goods Act 1979 (sale in market overt).
Case Law
ILLEGALITY Case Law
a) Contracts illegal as formed ILLEGALITY Archboldsillegal as formed 1 QB 374; [1961] 1 All ER 417 a) Contracts v Spanglett [1961] Langton v Hughes (1813) 1 M and S 593 Archbolds v Spanglett [1961] 1 QB 374; [1961] 1 All ER 417 Langton v Hughes (1813) 1 M and S 593
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HOLBORN COLLEGE Mahmoud & Ispahan, Re [1921] 2 KB 716; [1921] All ER Rep 217 Mohamed v Alaga & Co (A Firm) [1999] 3 All ER 699 (CA) b) Contracts illegal as performed Anderson v Daniel [1924] 1 KB 138 Ashmore, Benson, Pease & Co v A V Dawson [1973] 1 WLR 828 St John Shipping v Joseph Rank [1957] 1 QB 267 c) Contracts involving the deliberate commission of a civil wrong Begbie v Phospate Sewage Co Ltd (1875) LR10 QB 491 d) Contracts involving the deliberate commission of a crime Bigos v Boustead [1951] 1 All ER 92 e) Contracts contrary to public policy i) The promotion of sexual immorality Pearce v Brooks (1866) LR 1 Ex 213 ii) The promotion of corruption in public life Parkinson v Royal College of Ambulance [1925] 2 KB 1 iii) Damaging to UKs foreign relations Regazzoni v Sethia [1958] AC 301 THE RECOVERY OF BENEFTIS TRANSFERRED UNDER ILLEGAL CONTRACTS a) Generally Shanshal v Al Kishtaini [2001] 2 All ER (Comm) 601 (at 610 per Mummery LJ) b) Exceptions i) Mistake of fact Oom v Bruce (1810) 12 East 225 ii) Misrepresentation Hughes v Liverpool Victoria Legal Friendly Society [1916] 2 KB 482 iii) Repudiation of illegal purpose Taylor v Bowers (1876) 1 QBD 291 iv) Contract illegal for protection of claimant Kiriri Cotton v Dewani [1960] AC 192 v) Tort Bowmakers v Barnet Instruments [1945] KB 65 vi) Restitution Mohamed v Alaga [1999] 3 All ER 699 vii) Quantum meruit ACT Construction v E Clarke & Sons (Coaches) Ltd (unreported)
LLB
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CONTRACT LAW
HOLBORN COLLEGE viii) Collateral contract Strongman v Sincock [1955] 2 QB 525
LLB
Articles
Buckley Illegal Transactions: Chaos or Discretion? (2000) LS 155 Enonchong Title Claims and Illegal Transactions (1995) 111 LQR 135 Enonchong Illegal Transactions: The Future? (2000) RLR 82 McBride Restitution for Services Performed Under an Illegal Contract [1998] CLJ 449 Rose Confining Illegality (1996) 112 LQR 545 Stone The Unruly Horse Has Bolted (1994) 57 MLR 441 Virgo Withdrawal from Illegal Transactions: A Matter for Consideration [1996] CLJ 23
Reports
Law Com Consultation Paper No 154 Illegal Transactions: The Effect of Illegality on Contracts and Trusts
Interrograms
1. 2. 3. 4. 5. 6. 7. 8. 9. 10. 11. 12. 13. 14. 15. 16. Does the law of contract interfere with a persons moral behaviour? Is a contract to commit a deliberate civil wrong illegal? A contract lawful in itself but performed unlawfully will be illegal. True or false? Why was the contract upheld in St John Shipping v Joseph Rank? What is the significance of ss12 Law Reform (Miscellaneous Provisions) Act 1970 in this context? What tests have the courts used to determine the effect of a statute on the illegality or otherwise of a contract? Explain the decision in Pearce v Brooks. Will a court ever grant specific performance of an illegal contract? Can a guilty party to an illegal contract enforce the contract? What is the meaning of in pari delicto potior est conditio possidentis? Why did the plaintiff succeed in suing for the value of the whisky in Archbolds v Spanglett? How did the builders succeed in Strongman v Sincock? If a person repents of the illegal contract will this alter the courts attitude to the available remedies? Why did Bowmakers succeed in their action in conversion against Barnet Instruments (Bowmakers Ltd v Barnet Instruments)? Does title to property normally pass under an illegal contract of sale? To what extent is it true to say that neither party to an illegal contract may recover any property which has passed under that contract?
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CONTRACT LAW
HOLBORN COLLEGE 17.
LLB
Can a person recover back money paid or property transferred under an illegal contract if he entered into the contract as a result of the other partys fraudulent misrepresentation that the contract was legal?
Questions
1. Boots, wanting to win the first prize of 5,000 in the Muckie Bar Caber Tossing Championships, approaches McEvil, a caber constructor. Boots asks McEvil to construct for him a caber which, at the flick of a concealed switch, will weigh only half as much as a proper caber. McEvil realises that this is impossible but nevertheless agrees to do so for 500, demanding 70 as a down payment. On the day of the Championships, Boots decides not to use the McEvil caber and instead uses an ordinary one. Boots loses. Boots now wishes to return the special caber to McEvil and recover his 70. McEvil is demanding payment of the outstanding 430. Discuss. 2. C was a registered supplier of Welsh ink. A statute provides that, because it is poisonous, the ink can be supplied only by registered suppliers and only to licensed recipients. Each delivery has to be accompanied by a statutory invoice describing the contents. C supplied 20 gallons of ink to D, a licensed recipient, but C failed to deliver a statutory invoice because D had said that he did not require one. C sold and delivered 10 gallons of ink with a statutory invoice to E who was not a licensed recipient. C supplied 10 gallons of ink to F who was a licensed recipient. F knew that C had failed to provide an invoice when the ink was delivered. C sold and delivered 15 gallons of ink to G, a licensed recipient, when, unknown to C, his registration had expired. None of the recipients paid for the ink. Advise C. 3. 4. To what extent is it true to say that neither party to an illegal contract may recover any property which has passed under that contract? X is a licensed alligator dealer. On Monday 15 August Y telephoned X and expressed an interest in buying two of Xs alligators. Under statutory regulations any sale of alligators is illegal unless both buyer and seller have a licence. Y told X that he did not have a licence at the moment but would buy one by Friday 19 August and the come directly to Xs farm to negotiate a contract. Y was so busy during the week that he forgot to buy a licence. Nevertheless he still went to Xs farm on Friday to agree a contract. X offered to sell two alligators to Y for 2,000 each. Y said he would pay this providing X undertook to deliver one of the alligators to Ys friend Z by 3 oclock on Sunday 21 August. Y told X that he needed the alligator to reach Z on Sunday because Z had already paid him 200 for the right to display the alligator in Zs zoo for a month. Y told X he did not need to deliver the second alligator as he (Y) would arrange to pick up that alligator in his own time. X agreed to Ys terms and Y accordingly wrote X a cheque for 4,000. X delivered the alligator to Z as arranged. Z was delighted to receive the animal because he believed
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this extra attraction would enable him to raise the price of admission to the zoo from 1.50 to 1.75 for adults. X presented Ys cheque on the following Monday to find that it would not be honoured. Then on Wednesday X also found out that Y had bought the alligators without a licence. Advise X and Z of their rights against Y. 5. a) English law allows plaintiffs to sue on illegal contracts if they can show just cause why their claim should not be defeated by their illegality. Discuss. b) S entered into a contract with Y in which Y agreed to transport 200 sheep by road for S from Newcastle to Southampton for 3,000. S hoped to sell his sheep in Southampton for 50 each.
Statutory regulations provide that no person may transport sheep by road in the UK unless they have a licence from the Department of Health. S did not know that Y did not have a licence. During the journey 100 sheep died because of the inhumane conditions in which they were forced to travel. When the sheep arrived in Southampton they were in such a poor state that S could only sell them for 30 each. Advise S as to his rights and liabilities against Y. 6. Lemon was a supplier of antique clocks who was registered as required by the (fictitious) Antique Clock Dealers Act 1996. Lemon supplied a Queen Anne clock to Milter, without providing the statutory invoice describing the clock as required by the Act, after Milter had said that as far as he was concerned none was necessary. The agreed price was 2,000, but Milter subsequently refused to pay for the clock. To Norma he delivered a grandmother clock for 1,300. Again Lemon failed to provide a statutory invoice. Two weeks later the clock stopped and cost 500 to restore to working condition. Lemon supplied a French clock to Opren for 500. Opren ran a brothel though Lemon did not know this. Opren refused to pay for the clock which she had put in the room where she received clients. Advise Lemon. What difference, if any, would it make to your advice if Lemons licence had expired before the above transactions were entered into though Lemon was unaware of this?
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Part 2: Study Unit Sixteen Part 2: Study Unit Sixteen

Topic
Restraint of Trade Topic Restraint of Trade
Prologue
Restraint of trade examines a specific type of term in a contract that creates an obligation on a Prologue party, even after the contract is discharged or terminated. These terms are particularly found Restraint of of employment. a specific type of term in a contract that creates an obligation on a in contracts trade examines party, even after the contract is discharged or terminated. These terms are particularly found in contracts of employment.
Essential Reading
Obligations: Contract Law, Cracknell Relevant Chapter(s) Essential Reading Contract Law, McKendrick Relevant Relevant Textbook on Contract Law RelevantChapter(s)Chapter(s) Obligations: Contract Law, Cracknell Chapter(s) Contract Law, McKendrick Relevant Chapter(s)
Other Reading
Contract,ReadingMaterials, Beale, Bishop and Furmston Relevant Chapter(s) Other Cases and The Law of Contract,Materials,Relevant Chapter(s)Furmston Relevant Chapter(s) Contract, Cases and Treitel Beale, Bishop and Contract Law, McKendrick Relevant Chapter(s) The Law of Contract, Treitel Relevant Chapter(s)
Learning Outcomes
a) To have examined the Learning Outcomes approach of the modern law in relation to covenants in restraint of trade. a) To have examined the approach of the modern law in relation to covenants in restraint b) To have learnt the various interests that merit protection. of trade. c) To have understood the public interest elements in this area of law. b) To have learnt the various interests that merit protection. d) To have examined exclusive dealing contracts. c) To have understood the public interest elements in this area of law. d)
Sources of Law
Statute Sources of Law
Fair Trading Act 1973 Statute Fair Trading Act 1973
To have examined exclusive dealing contracts.
Case Law
CONTRACT OF EMPLOYMENT Case Law a) Area of restraint CONTRACT OF EMPLOYMENT Hollis & Co v Stocks [2000] IRLR 712 a) Area of restraint Mason v Provident Clothing & Supply Co Ltd [1913] AC 724 Hollis & Co v Stocks [2000] IRLR 712 Mason v Provident Clothing & Supply Co Ltd [1913] AC 724
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HOLBORN COLLEGE b) Time Fellows v Fisher [1976] QB 122 Fitch v Dewes [1921] AC 158 c) Trades forbidden Attwood v Lamont [1920] 3 KB 571 d) Solicitation of customers Bridge v Deacons [1984] 2 All ER 19 Lapthorne v Eurofi [2001] UKCLR 996 SALE OF A BUSINESS British Reinforced Concrete v Schelff [1921] 2 Ch 563 Nordenfelt v Maxim Nordenfelt Guns & Ammunition Co (above) FRANCHISES Convenience Co v Roberts [2001] FSR 35 RESTRICTIVE TRADING AGREEMENTS English Hop Growers v Dering [1928] 2 KB 174 Kores Manufacturing v Kolok Manufacturing [1959] Ch 108 TSC Europe (UK) Ltd v Massey [1999] IRLR 22 SOLUS TRADING AGREEMENTS Alec Lobb (Garages) Ltd v Total Oil [1985] 1 All ER 303 Esso Petroleum v Harpers Garages (above) SEVERANCE Attwood v Lamont (above) Goldsoll v Goldman [1915] 1 Ch 292 Wyatt v Kreglinger & Fernau [1933] 1 KB 793
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Articles
Smith Reconstructing Restraint of Trade [1995] OJLS 563 Spowart-Taylor and Hough The Client and Restraint of Trade (1984) 47 MLR 745 Wynn-Evans Restrictive Covenants, Reasonableness and Wrongful Dismissal (1997) 113 LQR 377
Interrograms
1. 2. 3. What is a covenant in restraint of trade? Are such covenants prima facie valid or void? What are the normal interests that merit protection between employer and former employee?
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HOLBORN COLLEGE 4. 5. 6. 7. 8. 9. 10. 11. 12. 13.
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What is the normal interest meriting protection between a vendor and a purchaser of a business? What was the interest in the Nordenfelt case? When will a restraint of trade covenant be reasonable? When will an area covenant be unreasonable? Why was the covenant in Mason v Provident Clothing Supply not enforceable? How do the courts determine if the duration of the restraint is reasonable? Was the covenant enforceable in Home Counties Dairies v Skilton? In what way did the approach in Briggs v Oates differ from the traditional analysis of restraint of trade clauses? What was the alternative ground for the decision in Briggs v Oates? What was the decision of the House of Lords in Esso v Harpers?
Questions
1. Bob and Ted were in partnership as surveyors and valuers. Each covenanted with the other that he would not, during the time they were in partnership or within five years thereafter, practise within eight miles of their present office or any other office in which the other should thereafter practise. Bob later took Albert as an articled clerk and Albert covenanted that he would not, whilst employed by Bob or within 10 years of ceasing to be so employed, practise within eight miles of Bobs office or any office which Bob should thereafter practise as a surveyor, valuer or estate agent. A year ago the partnership was dissolved and Albert ceased to be employed by Bob. Both Ted and Albert are now practising within eight miles of Bobs office. Advise Bob. 2. In administering the doctrine of restraint of trade, the courts try to maintain a balance between the freedom of the individual and the protection of the employer. Discuss this statement in the light of decided cases. 3. Jenny, aged nineteen, entered into a contract with Slinks Ltd of London whereby she was to be trained as a model for three years. The contract provided that on completion of her training Jenny would not work in any other fashion house in the United Kingdom for a period of ten years. Jenny has now completed her training and has been offered a very good contract with the fashion house of Hoots Ltd in Scotland. Advise Jenny as to her legal position. 4. An employer is not permitted to protect himself by contract against competition as such on the part of his former employees, but he may enforce any agreed restrictions which are necessary to protect his legitimate interests. Explain and comment. 5. P Ltd carry on business as dry rot consultants, with branches throughout the United Kingdom. Last year Q agreed to work for P Ltd for five years as head of their research laboratory, and his contract contained a covenant that he would not be directly or indirectly concerned in any business acting as dry rot consultants anywhere in England or Wales for two years after leaving his employment with P Ltd.
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Q has been approached by R Ltd, another firm of dry rot consultants, who have asked him to become head of their research laboratory at twice his present salary. Advise Q. 6. The doctrine of restraint of trade is one to be applied to factual situations with a broad and flexible rule of reason. (Per Lord Wilberforce) Explain the factual situations to which the doctrine has been applied and the principles upon which it operates.
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Part 2: Study Unit Seventeen Part 2: Study Unit Seventeen

Topic Topic Frustration
Frustration
Prologue Prologue This topic examines the doctrine of frustration which, when it materialises, has the effect of
bringing the performance of the contract to a complete halt. The ways in which frustration This topic examines the doctrine of frustration which, when it materialises, has the effect of may occur is also analysed. bringing the performance of the contract to a complete halt. The ways in which frustration may occur is also analysed.
Learning Outcomes Learning Outcomes amounts to frustration of a contract. a) To have examined what
b) a) c) b) c) d) d) understood the amounts to frustration of contract. To have examined what development of the lawof afrustration. To have understoodthe the effect of frustration at common law, in particular the Fibrosa examined the development of the law of frustration. case. To have examined the the effect of frustration at common law, in particular the Fibrosa To have learnt the effect of the Law Reform (Frustrated Contracts) Act 1943. case. To have learnt the effect of the Law Reform (Frustrated Contracts) Act 1943.
Law Reform Statutes (Frustrated Contracts) Act 1943 Law of Goods Act 1979: Contracts) Act 1943 Sale Reform (Frustrated s7 Sale of Goods Act 1979: s7
Case Law Case Law OLD LAW

Paradine OLD LAW v Jane (1647) Aleyn 26 Paradine v Jane (1647) Aleyn 26
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HOLBORN COLLEGE DEVELOPMENT Taylor v Caldwell (1863) 3 B and S 826 CURRENT FORMULATION Davis Contractors Ltd v Fareham Urban District Council [1956] AC 696 National Carriers v Panalpina (Northern) Ltd [1981] AC 675 Pioneer Shipping Ltd v BTP Tioxide [1982] AC 724 PERFORMANCE IMPOSSIBLE a) Subject matter destroyed Taylor v Caldwell (above) b) Party dead Graves v Cohen (1929) 46 TLR 121 c) Subject matter unavailable Jackson v Union Marine Insurance (1873) LR 10 CP 125 PERFORMANCE ILLEGAL Denny Mott & Dickson v James Fraser [1944] AC 265 OBLIGATIONS RADICALLY DIFFERENT Herne Bay Steamboat v Hutton [1903] 2 KB 683 Krell v Henry [1903] 2 KB 740 LIMITS TO FRUSTRATION a) Reduced profitability Davis Contractors Ltd v Fareham UDC (above) Tsakiroglou v Noblee Thorl [1962] AC 93; [1961] 2 All ER 179 b) Self-induced frustration Joseph Constantine Steamship Line Ltd v Imperial Smelting Corp [1942] AC 154 Lauritzen AS v Wijsmuller BV [1990] 1 Lloyds Rep 1 Maritime National Fish v Ocean Trawlers Ltd [1935] AC 524 c) Contractual provision Metropolitan Water Board v Dick Kerr [1918] AC 119 d) Leases Cricklewood Properties v Leightons Investments [1945] AC 221 National Carriers v Panalpina (Northern) Ltd [1981] AC 675 EFFECTS OF FRUSTRATION a) Common law Fibrosa v Fairbairn Lawson Ltd [1943] AC 32
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HOLBORN COLLEGE b) Statute BP Exploration v Hunt [1982] 1 All ER 925
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Articles
Clark Frustration, Restitution and the Law Reform (Frustrated Contracts) Act 1943 [1996] LMCLQ 170 McKendrick Self Induced Frustration and Force Majeure Clauses [1989] LMCLQ 3 Stewart and Carter Frustrated Contracts and Statutory Adjustment: The Case for a Reappraisal [1992] CLJ 66
Interrograms
1. 2. 3. 4. 5. 6. 7. 8. 9. 10. 11. 12. 13. 14. 15. 16. 17. 18. 19. 20. Why was the defendant bound to pay the rent in Paradine v Jane? Why was the hirer of the music hall not able to claim damages in Taylor v Caldwell? Must a frustrating event be unforeseen by both parties? What is meant by impossible to perform in this context? Explain the decision in Jackson v Union Marine. Is there a distinction between Krell v Henry and Herne Bay Steamboat v Hutton? Why was the contract frustrated in the Fibrosa case? What is the effect of self-induced frustration? Explain the decision in Maritime National Fish v Ocean Trawlers. Does the doctrine of frustration apply to leases? When a contract is frustrated what happens to the unperformed obligations of the parties? If a contract is frustrated is it void ab initio? On what ground did the Polish company recover its money back in the Fibrosa case? When does the Law Reform (Frustrated Contracts) Act 1943 apply? In general what change in the law is made by s1(2) of the Act? Explain the proviso to s1(2). In general what change in the law is made by s1(3) of the Act? Does the court have a discretion to award compensation for partial performance where a contract has been frustrated? Following BP v Hunt how do you assess the valuable benefit for s1(3) of the Act? Is reform of the 1943 Act long overdue?
Questions
1. Z, the manager of The Rocking Burps, a pop group, agreed with X, for a fee of 15,000, that the group would perform two weeks later at a concert organised by X. The lead singer of the group, Windy, took drugs on the day before the concert and as a result was unable to perform properly as he was in a dazed state. Although he started to perform he was booed off the stage. As a result X, who had paid 16,000 to hire the venue, had to return 28,000 to dissatisfied fans. - 80 CONTRACT LAW
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Advise X. What difference, if any, would it make to your advice if Windys beer had been laced with the drug by some unknown third party? 2. Donald contracted to take a group of children on a five day coach trip to Cornwall. He hired a coach for 200 (and paid 50 in advance), and booked accommodation in his name at a hotel. The parents of the children paid him the cost of the holiday. The day before the party was due to depart all coach drivers came out on strike in sympathy with the railwaymen who had been on strike for a month. Donald cancelled the holiday. The hotel are claiming damages for loss of profit from him, and the parents and children are extremely disappointed. Advise Donald. 3. a) Even if there is a radical change of circumstances a contract is not necessarily frustrated. Comment. b) Len, a retired law lecturer, arranged with Fred to give Freds son, Simon, a course of two one hour lessons a week for ten weeks to prepare him for his Law of Contract examination. It was agreed that Fred would pay Len 50 at the beginning of the course and a further 150 at the end.
After five lessons Simon had a nervous breakdown and was obviously not going to be able to take the examination. Fred therefore cancelled the rest of the course. Len had spent a considerable amount of time preparing the classes and had bought the latest edition of the set text books. Advise Len. 4. Lord Blessers, who wishes to celebrate his daughters wedding in style, arranges an open air pop concert in Blessers Park, in the county of Loamshire. On 1 February he engages a famous group The Wild Things to appear for 5,000. He is obliged to pay them 1,000 immediately, the balance to be payable on 1 July, the day of the concert. On 1 March he engages a catering firm Eatwell to provide 500 lunches in the marquee in Blessers Park for 10,000, payable on 1 July. On June 1 foot and mouth disease, which has been affecting neighbouring counties for the previous six months, breaks out in Loamshire. The disease cannot be contracted by human beings but can be spread by them. The Minister of Agriculture appeals to residents of Loamshire, on a voluntary basis, to cancel any outdoor events. Lord Blessers immediately cancels the celebrations and informs the group and the caterers that their services are no longer required. The group has spent considerable sums of money setting up an elaborate stage whilst the caterers have incurred considerable expense in preparations. Advise The Wild Things and Eatwell. How would your advice differ, if at all, if the bride had been killed in an accident a week before her wedding day? 5. X owns a holiday cottage in a remote mountain area. In May he agreed to let it to Y from 115 August. Y paid a deposit of 200. On the afternoon of 31 July, after Y and his family had set off from their home near London, a landslide rendered the cottage uninhabitable. X, who had recently spent 500 on redecoration in preparation for Ys visit, was unable to contact Y, and Y only found out what had happened when he arrived at the cottage. Y spent 200 on hotel accommodation for the night before returning home next day. Y and his family were very disappointed at not having the holiday they had planned.
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Advise X. What difference, if any, would it make if the damage to the cottage had been caused by a fire carelessly started by X? 6. Xerxes Travel Ltd specialises in tours to Archaea. In March this year Fred booked a two week tour for himself and his wife, Hilda, in August and paid a deposit of 250. Archaea has always been a peaceful country with a stable government but a revolution in nearby Agraria in April led to widespread rioting in Archaea. As a result of the uncertain situation Xerxes took no more bookings for tours to Archaea. In July it informed Fred that it was cancelling the August tour and would not be able to return his deposit, as it had paid 1,000 in non-refundable charter fees for seats on flights to Archaea. Hilda was so disappointed and outraged at this high-handed treatment that she insisted that Fred should ask Xerxes to provide seats for them on a scheduled flight to Archaea and two weeks hotel accommodation for the balance of the cost of the original tour, which Fred tendered. Xerxes refused. Advise Xerxes Travel Ltd. Would your answer be different if on 31 July the Archaean government banned all tourists from entering the country until further notice?
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Part 2: Study Unit Eighteen Part 2: Study Unit Eighteen

Topic Topic Discharge of Contracts Performance, Agreement and Breach
Discharge of Contracts Performance, Agreement and Breach
Prologue Prologue This topic analyses
the way in which contracts can be discharged or brought to an end. Primarily, itanalyses the way in which contracts can be discharged or brought to an end. can be achieved in three ways: performance, agreement and breach. This topic Primarily, it can be achieved in three ways: performance, agreement and breach.
Essential Reading EssentialContract Law, Cracknell Relevant Chapter(s) Obligations: Reading

Textbook on Contract Law Cracknell Chapter(s) Chapter(s) Obligations: Contract Law,Relevant Relevant Contract Law, Mckendrick Relevant Chapter(s) Contract Law, Mckendrick Relevant Chapter(s)
Learning Outcomes Learning Outcomes discharge a) To have understood

a) b) b) c)
of contracts by performance, by agreement and by breach. understood discharge of contracts by performance, by agreement and by To have To have breach. examined the distinction between entire and severable obligations.
c) d) d)
To have examined the distinction between entire and severable obligations. Commerce have examined the distinction between Woodar v Wimpey and Federal & Navigation v Molena distinction between Woodar v Wimpey and Federal Commerce To have examined the Alpha. & Navigation vthe concept and effects of an anticipatory breach. To have learnt Molena Alpha. To have learnt the concept and effects of an anticipatory breach.

Case Law PERFORMANCE
PERFORMANCErule a) General a) General Powell (1795) 6 Term Rep 320 Cutter v rule Raiffeisen-Zentralbank 6 Term RepAG v Cross-Seas Shipping Ltd & Others (2000) The Cutter v Powell (1795) Osterreich 320 Times 1 February (CA) Raiffeisen-Zentralbank Osterreich AG v Cross-Seas Shipping Ltd & Others (2000) The Times 1 February Performance prevented (CA) Performance prevented Planch v Colburn (1831) 8 Bing 14 Planch v Colburn (1831) 8 Bing 14 Acceptance of partial performance Acceptance of partial performance Sumpter v Hedges [1898] 1 QB 673 Sumpter v Hedges [1898] 1 QB 673 UNDERGRADUATE PROGRAMME UNDERGRADUATE PROGRAMME - 83 - 83 CONTRACT LAW CONTRACT LAW
b) b) c) c)
HOLBORN COLLEGE d) Whether time is of the essence Union Eagle Ltd v Golden Achievement Ltd [1997] 2 All ER 215 (JCPC) AGREEMENT Eodem modo quo oritur, eodem modor dissoluitur BREACH a) Actual breach Bettini v Gye (1876) 1 QBD 183 Hong Kong Fir Shipping v Kawasaki Kisen Kaisha [1962] 2 QB 26 Modahl v British Athletic Federation Ltd (1999) The Times 23 July (CA) Poussard v Spiers & Pond (1876) 1 QBD 410 b) Anticipatory breach
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Afovos Shipping v Pagnan [1983] 1 All ER 449 Alfred C Toepfer International GmbH v Itex Itagrani Export SA [1993] 1 Lloyds Rep 360 Avery v Bowden (1855) 5 E and B 714 Clea v Bulk Oil [1984] 1 All ER 129 Federal Commerce & Navigation v Molena Alpha [1979] AC 757 Fercometal Sarl v Mediterranean Shipping Co SA [1988] 2 All ER 742 Frost v Knight (1872) LR 7 EX 111 Hochster v De la Tour (1853) 2 E & B 678 Mersey Steel & Iron v Naylor Benzon (1884) 9 App Cas 434 Vitol SA v Norelf Ltd (The Santa Clara) [1996] 3 WLR 107; [1996] 3 All ER 93 (HL) White & Carter (Councils) v McGregor [1962] AC 413 Woodar v Wimpey [1980] 1 WLR 227; [1980] 1 All ER 571
Articles
Hedley Acceptance of Anticipatory Breach [1996] CLJ 14 Hedley Vitol SA v Norelf Ltd in the House of Lords [1996] CLJ 430 Treitel Affirmation After Repudiatory Breach (1998) 114 LQR 22
Interrograms
1. 2. 3. 4. 5. 6. 7. 8. If a party fully performs his obligations under a contract, is it discharged? What is a condition precedent? If A agrees to work for B at 50 per week payable in arrears, when does Bs liability arise? What is a concurrent condition? Is there a general requirement of substantial failure to perform before the victim of the breach can terminate? What is meant by an entire obligation in contract law? Explain the decision in Cutter v Powell. Explain the decision in Sumpter v Hedges.
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HOLBORN COLLEGE 9. 10. 11. 12. 13. 14. 15. 16. 17. What are severable obligations? What is the distinction between Woodar v Wimpey and Molena Alpha?
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If one of the parties to a contract, before the time fixed for performance is fixed, states he will not perform his obligations, what type of breach has he committed? What choice has the victim of an anticipatory breach? In Hochster v De la Tour did the plaintiff elect to affirm the contract? Explain the decision in Avery v Bowden. What are the disadvantages of affirming the contract after an anticipatory breach? After termination by breach is the victim still bound to perform his obligations? After an affirmation of a contract is the victim still bound to perform his obligations?
Questions
1. What remedies are available to the innocent party to a contract where, before the time for its performance, the other party declares that he will refuse to perform the contract at the due time? John entered into a contract with Harry to hire Harrys helicopter for a two month survey of the Sahara desert, to take place in August of this year. John has just been told by Harry that Harry will need the helicopter himself during that period. There is a rumour that surveys such as that planned by John may shortly be banned. Advise John as to his legal rights, if any. 3. In June Gareth entered into a contract to buy 10,000 rugby balls from Tries Ltd for 200,000. The rugby balls were to be delivered on 18th October. Gareth immediately agreed to resell the rugby balls to Richard in Peru for 250,000. On 16th August Tries Ltd told Gareth that they would not be able to fulfil the order. Gareth knows that if Tries Ltd continue to produce rugby balls at their present rate they will be able to meet the commitment, but Gareth has also heard a rumour that the government might ban the production of rugby balls in the United Kingdom as a result of the British Lions losing the test series in South Africa. Gareth could probably obtain the rugby balls from France but these would cost him 280,000. Advise Gareth as to his legal position. 4. A party who does not perform the whole of the contract is not entitled to any payment. Discuss.
2.
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Part 2: Study Unit Nineteen Part 2: Study Unit Nineteen

Topic Remedies for Breach of Contract Damages (1) Topic
Remedies for Breach of Contract Damages (1)
Prologue This topic examines the common law remedy of damages available in the event of a breach of Prologue
contract. This topic examines the common law remedy of damages available in the event of a breach of contract.
Learning Outcomes a) To have understood the Learning Outcomes general basis of assessment of contractual damages.
b) a) c) b) d) c) d) To have learnt that the general basis of assessment of contractual damages. To have understooddamages which are too remote cannot be recovered. To have examined the cases on remotenessremote cannot be recovered. To have learnt that damages which are too of damages. To have learnt the the cases of mitigation of damages. To have examined principleson remotenessof damage. To have learnt the principles of mitigation of damage.
Assessment Case Law of damages
Anglia TV v Reed [1972] 1 QB 60 Assessment of damages Jonathan Cape Ltd, third party [2000] 4 All ER 395 Attorney-General v Blake, Anglia TV v Reed [1972] 1 QBStar Insurance Co Ltd [1996] 3 WLR 87 (also reported as South Banque Bruxelles SA v Eagle 60 Attorney-General v Blake, JonathanCorp v York Montague Ltd [1996] 3 All ER 365 (HL)) Australia Asset Management Cape Ltd, third party [2000] 4 All ER 395 Banque Bruxelles SA v Eagle Ltd vInsurance Co Ltd [1996] 3 WLR 87 (also reported as South Bence Graphics International Star Fasson UK Ltd [1998] QB 87 C & P Australiav Middleton [1983] 1 WLR York Montague Ltd [1996] 3 All ER 365 (HL)) Haulage Asset Management Corp v 1461 BenceFilms (London) Ltd v ImpactvQuadrant Films Ltd [1984] 3 WLR 245 CCC Graphics International Ltd Fasson UK Ltd [1998] QB 87 C & P Haulage v Middleton [1983] 1 WLR 1461 [2000] 4 All ER 97 Panatown Ltd v Alfred McAlpine Construction Ltd CCC Films (London)and Construction Ltd v Films Ltd [1984] 3 WLREnclosures Ltd v Same Ruxley Electronics Ltd v Impact Quadrant Forsyth; Laddingford 245 Panatown Ltd 3 WLR 118; [1995]Construction Ltd [2000] 4 All ER 97 [1995] v Alfred McAlpine 3 All ER 268 (HL) Ruxley Electronics and1Construction Ltd v Forsyth; Laddingford Enclosures Ltd v Same Watts v Morrow [1991] WLR 1421 [1995] 3 WLR 118; Lameys Distribution Ltd White Arrow Express Ltd v [1995] 3 All ER 268 (HL) [1995] TLR 430 (CA) Watts v Morrow [1991] 1 WLR 1421 White Arrow Express Ltd v Lameys Distribution Ltd [1995] TLR 430 (CA) UNDERGRADUATE PROGRAMME UNDERGRADUATE PROGRAMME - 86 - 86 CONTRACT LAW CONTRACT LAW
HOLBORN COLLEGE REMOTENESS OF DAMAGE Chaplin v Hicks [1911] 2 KB 786 Cory v Thames Ironworks (1868) LR 3 QB 181 Hadley v Baxendale (1854) 9 Exch 341 Heron II, The [1969] 1 AC 350 Jackson v Royal Bank of Scotland [2000] CLC 1457 Parsons v Uttley Ingham [1978] 1 All ER 525; [1978] QB 791 Victoria Laundry v Newman Industries [1949] 2 KB 528 CAUSATION County Ltd v Girozentrale Securities [1996] 3 All ER 834 Monarch, The [1949] AC 196 MITIGATION Brace v Calder (1895) 2 QB 253 British Westinghouse v Underground Electric [1912] AC 673 CONTRIBUTORY NEGLIGENCE
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Barclays Bank plc v Fairclough Building Ltd [1994] 3 WLR 1057; [1995] 1 All ER 289 (CA) Gran Gelato Ltd v Richcliff Ltd [1992] 1 All ER 865
Articles
Beale Damages for Poor Service (1996) 112 LQR 205 Cartwright Remoteness of Damage in Contract and Tort: A Reconsideration [1996] CLJ 488 at 490 496, 504 507 and 513514 Coote Contract Damages, Ruxley and the Performance Interest [1997] CLJ 537 Enonchong Contract Damages for Wrongful Dishonour of a Cheque (1997) 60 MLR 412 Hooley Remedies for Wrongful Dishonour of a Cheque [1996] CLJ 189 Hopkins Contributory Negligence and Strict Contractual Duties: Barclays Bank v Fairclough Building [1995] CLJ 20 OSullivan Contract Damages for Failed Fun Taking the Plunge: Ruxley Electronics v Forsyth [1995] CLJ 496 Poole Damages for Breach of Contract (1996) 59 MLR 272 Porat The Contributory Negligence Defence and the Ability to Rely on the Contract (1995) 111 LQR 228 Treitel Damages for Breach of Warranty of Quality: Bence Graphics v Fasson Ltd (1997) 113 LQR 118
Interrograms
1. 2. Is an action for damages available as of right to the victim of a breach of contract? What are unliquidated damages?
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HOLBORN COLLEGE 3. 4. 5. 6. 7. 8. 9. 10. 11. 12. 13. 14. 15. 16. 17. 18. 19. What is the general traditional basis of assessment of contract damages? Are punitive damages normally awarded for breach of contract? What basis of assessment did the court use in Anglia TV v Reed? Must the breach have caused the loss that is being claimed?
LLB
Can judges apportion the blame for breach of contract and make a party liable for 30 per cent of the damage only? What is the test of remoteness laid down in Hadley v Baxendale? Why did the mill owners not recover for the loss of profits suffered when the mill stood idle (Hadley v Baxendale)? Does Victoria Laundry add anything to the test laid down in Hadley v Baxendale? Why were the boiler makers not liable for the loss of the lucrative contract with the Ministry of Supply (Victoria Laundry)? If the contract with the Ministry had been disclosed to the boiler makers would they have been liable for its loss (Victoria Laundry)? Is the test of remoteness of damages in tort the same as the test of remoteness in contract? In the Heron II were the shipowners liable for the loss resulting from the fall in price of the sugar market? Why did Scarman LJ and Orr LJ hold the defendants liable for the loss of the pigs in Parsons v Uttley Ingham? Can the victim recover damages for losses he could have avoided by taking reasonable steps? Explain the decision in Brace v Calder. Must the plaintiff give credit for benefits accruing to him as a consequence of the breach? Is it correct to say that the victim of a breach is under a duty to mitigate his loss?
Questions
1. Fred, an insurance agent, joins the Gornaway Hunt knowing that much business is transacted at the hunts evening festivities. In order to be properly equipped, Fred consults Snaffles, manager of Tantivy Ltd and explains the position to him. Snaffles assures Fred that he understands the position perfectly and has Fred measured for the proper clothes, which cost Fred 200. Snaffles tells Fred the clothes will be delivered three days before the first hunt of the season. Snaffles also shows Fred a horse called Sapwind which Snaffles tells Fred has been hunted with the Banyon Majors, one of the best hunts in the country. Fred buys the horse, warranted sound for the field, for 1,500. The clothes are not delivered until the morning of the hunt and are a very bad fit; also the jacket is hunting pink whereas for a newcomer it should have been black. The horse proves quite useless for hunting and Fred is thrown and rolled on at the first hedge and ditch, breaking an arm and a leg. Due to his injuries Fred is off work for two months, losing business worth 2,000. Because of his appearance and performance at the hunt, many members of the hunt are very upset and Fred is asked to give up his membership; this costs Fred an estimated 4,0005,000 in lost business. Advise Fred as to his legal rights, if any.
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LLB
F bought a house which needed complete redecoration before he could move in with his family. F engaged G to redecorate the house and the contract provided that the work would be finished in twelve weeks. G in fact took fifteen weeks to finish the work. Advise F whether he may claim damages in respect of: a) b) c) hotel bills for himself and his family for the additional three weeks (500); the rates and mortgage interest paid by him during the three weeks (200); the destruction of his furniture, during the additional three weeks, by a fire at the warehouse in which it had to be stored because he was unable to move in to the house (5,000).
3.
The principle that the damage must not be too remote is difficult to apply and often causes hardship to the plaintiff. Discuss.
4.
In January, Olive, a successful business executive living and working in London, was appointed manager of a firm in Manchester, commencing on April 1. Having found a house she liked in Manchester, Olive engaged Paul, a builder, to do some renovation to it, the contract providing that the work would be completed by March 31 at the latest. In breach of contract Paul did not complete the renovation until May 31 and Olive was unable to move into the house until June. During April and May, Olive continued to live in London at the weekends, flying to Manchester and back each week, and stayed in a five star hotel in Manchester during the week. She also engaged a nanny to look after her two small children during her absence. Olive is now claiming that Paul should pay her air fares between London and Manchester, the hotel bills, the cost of the nanny and a substantial sum to compensate her for the emotional distress of being separated from her family. Advise Paul.
Note: for compensation for emotional distress see unit 21. 5. a) The rule of common law is that where a party sustains a loss by breach of contract, he is, so far as money can do it, to be placed in the same position as if the contract had been performed. Discuss. b) Bill, a business tycoon, contacted a hire firm who provided chauffeured executive cars and booked a car for 6 am the following day to take him to Heathrow Airport from where he was booked to travel to New York with the intention of signing a multi-million dollar contract. The driver lost his way and arrived so late that Bill missed the flight and the opportunity of obtaining the contract. Advise Bill. 6. A Ltd employ B Ltd to build a multi-purpose sports complex. B Ltd engage subcontractors, C Ltd, who use cement which turns out to be highly unsuitable for the purpose for which it is used. Soon after completion and occupation of the building cracks begin to appear. The complex has to close for expensive repairs and a lot of revenue is lost. A Ltd had also put in a bid, which has to be withdrawn, to host the World Badminton Championships which would have produced large amounts of revenue. Advise A Ltd.
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CONTRACT LAW
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LLB
The plaintiff must be compensated for all the damage flowing from the breach, provided that it is not too remote. Explain.
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CONTRACT LAW
LLB LLB
Part 2: Study Unit Twenty Part 2: Study Unit Twenty

Topic Remedies for Breach of Contract Damages (2) Topic
Remedies for Breach of Contract Damages (2)
Prologue This topic looks at various other remedies that are available under the other heads of loss. Prologue
This topic looks at various other remedies that are available under the other heads of loss.
LearniOutcomes a) To have considered LearniOutcomes the cases where non-pecuniary loss has been recoverable.
b) a) b) c) To have considered the cases where non-pecuniary loss has been recoverable. a penalty To have learnt the distinction between a liquidated damages clause and clause. To have learnt the distinction between a liquidated damages clause and a penalty To have clause. examined the judgement in Dunlop Pneumatic Tyres v New Garage. To have consideredthe judgement in Dunlop Pneumatic Tyres v New Garage. To have examined the case of White & Carter (Councils) v McGregor. To have considered the case of White & Carter (Councils) v McGregor.
d) c) d)

Injury to reputation Case Law
a) a) b) b)
Injury to reputation
Reputation of company
Anglo-Continental Holdings v Typaldos Lines [1967] 2 Lloyds Rep 61 Reputation of company Anglo-Continental Holdings v Typaldos Lines [1967] 2 Lloyds Rep 61 Reputation of individual Addis v Gramophone Co [1909] AC 488 Reputation of individual Malik v BCCI [1997] 3 WLR 95; [1997] 3 All ER 1 (HL) Addis v Gramophone Co [1909] AC 488 Malik v BCCI [1997] 3 WLR 95; [1997] 3 All ER 1 (HL)
NON-PECUNIARY LOSS a)ON-PECUNIARY LOSS Discomfort, vexation, disappointment, injury to feelings N Addis v Gramophone Co [1909] AC 488 (HL) feelings a) Discomfort, vexation, disappointment, injury to Alexander v Rolls Royce Motor Cars Ltd [1995] TLR 254 (CA) Addis v Gramophone Co [1909] AC 488 (HL) Alexander v Rolls Royce Motor Cars Ltd [1995] TLR 254 (CA) UNDERGRADUATE PROGRAMME UNDERGRADUATE PROGRAMME - 91 - 91 CONTRACT LAW CONTRACT LAW
HOLBORN COLLEGE Farley v Skinner [2001] 3 WLR 899 (HL) Hayes v James and Charles Dodd [1990] 2 All ER 815 Jackson v Horizon Holidays [1975] 1 WLR 1468 Jarvis v Swan Tours [1973] 2 QB 233 Johnson v Unisys [2001] 2 WLR 1076 (HL) Watts v Morrow [1991] 1 WLR 1421; [1991] 4 All ER 937 b) Lost future prospects Dunk v George Waller [1970] 2 QB 163 c) Loss of a chance Chaplin v Hicks [1911] 2 KB 786 LIQUIDATED DAMAGES/PENALTY CLAUSES Cellulose Acetate Silk v Widnes Foundry [1933] AC 20 Cenargo v Empresa [2002] CLC 1151 Dunlop Pneumatic Tyres v New Garage [1915] AC 79 Jobson v Johnson [1989] 1 WLR 1026 Lordsvale Finance plc v Bank of Zambia [1996] 3 WLR 688; [1996] 3 All ER 156 Philips Hong Kong Ltd v AG of Hong Kong (1993) The Times 15 February
LLB
Articles
Burrows Mental Distress Damages for Breach of Contract [1990] NLJ 596 Burrows Recent Developments in the Law of Remedies [1990] NLJ 29 Capper Damages for Distress and Disappointment Problem Solved (2002) 118 LQR 193 Enonchong Damages for Injury to Reputation (1996) 59 MLR 592 Hedley What Price An Employees Reputation? [1997] CLJ 485
Interrograms
1. 2. 3. 4. 5. 6. 7. 8. 9. 10. 11. 12. What is the object of an award of damages? Where a breach of contract has caused injury, is that recoverable? Where a breach of contract has caused mental distress, is that recoverable? Explain the decision in Jarvis v Swan Tours. Why is it unusual? What is a liquidated damages clause? What is a penalty clause? If the parties have made a genuine attempt to estimate the loss likely to flow from the breach will their figure be upheld? Do the rules of remoteness apply to a liquidated damages clause? Do the rules of mitigation apply to a liquidated damages clause? In Dunlop Pneumatic Tyre was the clause held to be penal? If a clause stipulates a sum that is extravagant and unconscionable will it be a penalty clause? Why do the courts refuse to apply penalty clauses?
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HOLBORN COLLEGE 13. 14. 15.
LLB
Why did the court not use an actual loss basis for assessing the damage in Cellulose Acetate v Widnes Foundry? Do the rules of remoteness apply on an action for an agreed sum? Why did White and Carter (Councils) recover the full price of the contract from McGregor?
Questions
1. Damages for breach of contract can only be awarded in respect of loss of a financial kind. Discuss. 2. In June, Robert agreed to sell Elpis an elephant called Matilda for 8,000. The date for delivery was 19th July and it was agreed that if Robert failed to make delivery, then he was to pay Elpis 5,000 damages. Robert failed to make delivery, but by good fortune Elpis was able to purchase another elephant, Myrtle, for 9,000. Elpis is now claiming the 5,000 from Robert. Advise Robert as to his legal position. 3. Damages for breach of contract do not include compensation for disappointment, injured feelings or injury to reputation caused by the breach. Consider how far this is an accurate statement of the law. 4. E, an architect, was engaged to design building premises for F for Fs business. E was to be paid a fee of 2,000 a month plus reasonable expenses. E worked on the design for six months during which time E received only her fee payments from F. F then wrote to E saying that, because of financial difficulties, he was postponing Es contract. In fact, F did not like the design which E had produced and used the financial difficulties as an excuse for terminating Es contract. F refused to pay the expenses which E had incurred, arguing that they were not reasonable. In the letter accepting appointment E had enclosed her Standard terms which stated: (18) It is agreed that in matters of judgment Es decision shall be final; (19) In the event of a client not paying expenses when due, that client shall pay double the amount due as expenses. Advise E. 5. In March X engaged Miss Y for three years as his research assistant at a salary of 25,000 under a written agreement which included the following clauses: (6) The research assistant will dress smartly at all times. It is understood that trousers are not an acceptable form of dress under any circumstances. (7) The research assistant will work whatever hours are necessary to complete the assignments given to her. On 1 June X asked Y to produce certain statistics for a meeting with an important client at 9 am on 2 June. In spite of staying in the office until midnight, Y was not able to complete the statistics on 1 June. She returned to the office at 6 am on 2 June but had still not quite finished the work when X arrived at 8.30 am.
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CONTRACT LAW
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LLB
X was angry. He then noticed that Y was wearing trousers and told her, in front of several colleagues, that her contract was terminated. Y was extremely upset and humiliated; she is now receiving medical treatment for depression. Advise Y.
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CONTRACT LAW
LLB LLB
Part 2: Study Unit Twenty One Part 2: Study Unit Twenty One
Topic Remedies for Breach of Contract Equitable Remedies and Restitution Topic
Remedies for Breach of Contract Equitable Remedies and Restitution
Prologue This topic examines the remedies that are available in equity. These remedies are given at the Prologue
exclusive discretion of the courts. This topic examines the remedies that are available in equity. These remedies are given at the exclusive discretion of the courts.
Learning Outcomes a) To have considered the Learning Outcomes nature and availability of the remedy of specific performance.
b) a) b) c) d) c) d) e) e) To have considered cases where the court exercises its discretion to award or refuse the To have examined the nature and availability of the remedy of specific performance. remedy. To have examined cases where the court exercises its discretion to award or refuse the To have remedy. considered the nature and availability of the remedy of injunction. To have considered the nature and availability damages in lieu injunction. To have learnt the courts power to award of the remedy of of or in addition to an equitable remedy. To have learnt the courts power to award damages in lieu of or in addition to an To have remedy. equitableexamined the law of quasi-contract (restitution). To have examined the law of quasi-contract (restitution).
Sources of Law Statutes of Law Sources
Chancery StatutesAmendment Act 1858: s2 Supreme Amendment Act 1858: s2 ChanceryCourt Act 1981: s50 Supreme Court Act 1981: s50
Case Law
SPECIFIC PERFORMANCE Case Law Beswick v Beswick [1968] AC 58 SPECIFIC PERFORMANCE Co-op Insurance Co Ltd v Argyll Stores Ltd [1997] 2 WLR 898 (HL) BeswickAliBeswick1[1968] AC 58 Patel v v [1984] All ER 978 Co-op Insurance Co Ltd v Argyll Stores Ltd [1997] 2 WLR 898 (HL) Patel v Ali [1984] 1 All ER 978 UNDERGRADUATE PROGRAMME UNDERGRADUATE PROGRAMME - 95 - 95 CONTRACT LAW CONTRACT LAW
HOLBORN COLLEGE Posner v Scott-Lewis (1987) The Times 12 December Price v Strange [1978] Ch 337; [1977] 3 All ER 371 Quadrant Visual Communications v Hutchison Telephone (1991) The Times 4 December Ryan v Mutual Tontine Assoc [1893] 1 Ch 116 Shell UK v Lostock Garages [1976] 1 WLR 1187 Walters v Morgan (1861) 3 De GF and J 718 INJUNCTIONS Evening Standard v Henderson (1986) The Times 15 November Page One Records v Britton [1968] 1 WLR 157 Warner Bros v Nelson [1937] 1 KB 209 Wolverhampton Corp v Emmons [1901] 1 QB 515 DAMAGES AND EQUITABLE REMEDIES Johnson v Agnew [1980] AC 367 RESTITUTION
LLB
Aiken v Short (1856) 1 H & N 210 Barclays Bank v Simms and Cooke [1980] QB 677; [1979] 3 All ER 522 Butterworth v Kingsway Motors [1954] 1 WLR 1286 Fibrosa v Fairbairn Lawson [1943] AC 32 Foley v Classique Coaches [1934] 2 KB 1 Griffin v Weatherby (1868) LR 3 QB 753 Halifax Building Society v Thomas [1995] TLR 385 (CA) Kerrison v Glyn, Mills, Currie & Co (1912) 81 LJKB 465 Kiriri Cotton Co v Dewani [1960] AC 192 Kleinwort Benson Ltd v Lincoln City Council and Other Appeals [1998] 4 All ER 513 Meates v Westpac (1990) The Times 5 July Planch v Colburn (1831) 8 Bing 14 Portman Building Society v Hamlyn Taylor Neck (A Firm) [1998] 4 All ER 202 Regalian Properties plc v London Docklands Development Corporation [1995] 1 WLR 212; [1995] 1 All ER 1005 (Ch D) Westdeutsche Landesbank v Islington LBC [1996] 2 All ER 961 (HL)
Articles
Cope Compound Interest and Restitution (1996) 112 LQR 521 Dickson Unjust Enrichment Claims: a Comparative Overview [1995] CLJ 100 Hedley Unjust Enrichment [1995] CLJ 578 Heydon Equitable Aid to Purchasers in Breach of Time-Essential Conditions (1997) 113 LQR 385 Jones Specific Performance: A Lessees Covenant to Keep Open a Retail Store [1997] CLJ 488 Jones Ultra Vires Swaps [1996] CLJ 432 Key Change of Position: Unjust Enrichment and Restitution (1995) 58 MLR 505
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LLB
Key Detrimental Reliance in Anticipation of a Contract: Regalian Properties v London Docklands Development Corp (1995) 111 LQR 576 Key Excising Estoppel by Representation as a Defence to Restitution [1995] CLJ 525 Mannolini Restitution Where an Anticipated Contract Fails to Materialise (1996) 59 MLR 111 McInnes At the Plaintiffs Expense: Quantifying Restitutionary Relief [1998] CLJ 472 Stevens Restitution and the Brussels Convention (1996) 112 LQR 391 Virgo Anticipatory Contracts Restitution Restrained: Regalian Properties v London Docklands Development Corp [1995] CLJ 243
Interrograms
1. 2. 3. 4. 5. 6. 7. 8. 9. 10. 11. 12. 13. If a court orders specific performance of a contract, what happens to the contract? Why are damages not normally considered an adequate remedy for a contract for the sale of land? Are building contracts specifically enforceable? What is meant by saying a contract lacks mutuality? Why was specific performance refused in Shell UK v Lostock? Can a contract of employment be specifically enforced by the courts? Why was specific performance refused in Ryan v Mutual Tontine Assoc? What is a voluntary contract? What is an interlocutory injunction? What is a prohibitory injunction? Can a breach of contract be prevented by an injunction? If an injunction amounts to indirect specific performance will the court grant it? What alternative employment was available to Bette Davis when the injunction was granted to prevent her acting for anyone other than Warner Bros (Warner Bros v Nelson)? Why was the injunction not granted in Page One Records v Britton? What was the principal change introduced by s2 Chancery (Amendment) Act 1858? When would it be advantageous for a plaintiff to use the courts jurisdiction to award damages in lieu of/in addition to an equitable remedy? What principles of assessment govern damages awarded in lieu of specific performance? What is the ratio decidendi of Johnson v Agnew? In what circumstances may money paid under a mistake of fact be recovered? Is money paid under duress recoverable? Explain the concept of unjust enrichment. Why did the common law traditionally refuse to allow recovery for mistake of law? What is the present state of the law (see Kleinwort Benson v Lincoln City Council)?
14. 15. 16. 17. 18. 19. 20. 21. 22.
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CONTRACT LAW
HOLBORN COLLEGE 23. 24. 25.
LLB
Would it be desirable to enact statutory provisions setting out the general principles of recovery for mistake of fact and mistake of law? Is it a defence to a restitutionary claim that the defendant has changed his position in reliance on the receipt of the mistaken payment? In what circumstances may a quantum meruit action be brought? Explain the basis of the decision in Planch v Colburn.
Questions
Note: question 2 may raise issues considered in earlier units. 1. 2. When will a court order specific performance of a contract? J, a dealer, agreed to hire a small tractor to K for 50 per week for eighteen months and a miniature engine to M for 30 per week for 26 weeks. After three months J sold the tractor for 10,000 to L, who required immediate delivery. K refused to give it up as he needed it as an attraction for his circus. M fell ill after six weeks and J agreed to accept half rent until M recovered. Six weeks later M recovered and refused Js demand for payment of the arrears of the rent. Advise J. In relation to the tractor, what difference, if any, would it make to your advice if the tractor was the only surviving example of a particular model, which L wanted for his tractor museum? 3. What do you understand by the concept of unjust enrichment? Illustrate your answer by reference to case law.
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LLB
Revision and Examination Technique
Whole books have been written on how to study and this brief note makes no pretence at being an infallible guide. In any case, skill in revision and examination techniques is an art best acquired by actual practice. The more you study, the more you devise your own short cuts for efficient preparation for exams. Unfortunately, it is only when you actually sit the examination that you can see whether your particular method of revision is successful. If it is not, it is an expensive and frustrating way to find out. While it is true that examination techniques are best learned actually sitting examinations, it is not necessary to wait until the real thing. Mock examinations, tackled under realistic conditions, can be very helpful. For example, select a question and, without looking at the skeleton answer (if there is one), write out your own. You can use the questions set throughout this Planner to stage your own practice run. Or, if you have time, tackle a full quota of four or five questions at once as a mock examination. The short list of dos and donts below attempts to set out some suggestions which it is hoped most students will find of practical use in planning their revision and tackling examinations.
Dos
Before the examination a) Do plan ahead and make your plans increasingly detailed as you approach the examination date. Allocate enough time for each topic to be studied, bearing in mind the time actually available to you before the exams. b) c) d) Do exercise constant self-discipline, especially if studying at home. Do, during your course of study, especially once revision starts, constantly test yourself orally and in writing. Do keep up-to-date. While examiners do not require familiarity with changes in the law during the three months prior to the examination, it obviously creates a good impression to show you are acquainted with any recent changes. Sources that you might look at in order to be up to date include: leading journals such as Modern Law Review, Law Quarterly Review and New Law Journal; cumulative indices to law reports such as the All England Law Reports, and such sources as the Law Societys Gazette and the Legal Executive Journal. Do familiarise yourself with past examination papers, and try at least one mock examination well before the date of the real thing.
e)
In the examination room f) Do read the instructions on the examination paper carefully. While any last minute changes are unlikely such as the introduction of a compulsory question it has been known to happen.
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CONTRACT LAW
HOLBORN COLLEGE g) h)
LLB
Do read the questions carefully. Analyse problem questions work out what the examiner wants. PLAN YOUR ANSWER before you start to write. Do note mark allocations (if any) on the question paper. It is pointless to spend an excessive amount of time in producing a perfect answer to a part of a problem that carries only a tiny percentage of the marks. Do allow enough time to re-read your answers. A misplaced word (a not in the wrong place, for example) may turn a good answer into gibberish.
i)
Donts
a) Dont finish the syllabus too early constant revision of the same topic leads to stagnation but DONT leave revision so late that you have to cram. If you are the sort of person who works better to a deadline make it a realistic one! b) c) Dont try to learn by rote. In particular, dont try to reproduce model answers by heart. Learn to express the basic concepts in your own words. Dont answer the question you expect to see! By all means problem-spot before examinations by going over old exam papers but make sure that what the examiner is asking for really does match what you are preparing to write about.
and above all d) DONT PANIC!
Finally, it may be useful at this juncture to say a few words about the structure of your answers in the examination. Amost all examination problems raise more than one legal issue that you are required to deal with. Your answer should do all of the following. a) Identify the issues raised by the question This is of crucial importance and gives shape to the whole answer. It indicates to the examiner that you appreciate what he is asking you about. This is at least as important as actually answering the questions of law raised by that issue. The issues should be identified in the first paragraph of the answer. b) Deal with those issues one by one as they arise in the course of the problem This, of course, is the substance of the answer and where study and revision pays off. c) If the answer to an issue turns on a provision of a statute, CITE that provision briefly, but do not quote it in detail from any statute you may be permitted to bring into the examination hall Having cited the provision, show how it is relevant to the question. d) If there is no statute, or the meaning of the statute has been interpreted by the courts, CITE the relevant cases Citing cases does not mean writing down the name of every case that happens to deal with the general topic with which you are concerned and then detailing all the facts you can think of. You should cite only the most relevant cases there may perhaps only be one. No more facts should be stated than are absolutely essential to establish the relevance of the case. If there is a relevant case, but you cannot remember its name, it is sufficient to refer to it as one decided case.
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CONTRACT LAW
HOLBORN COLLEGE e)
LLB
Whenever a statute or case is cited, the title of the statute or the name of the case should be underlined This makes the examiners job much easier because he can see at a glance whether the relevant material has been dealt with, and it will make him more disposed in your favour.
f)
Having dealt with the relevant issues, summarise your conclusions in such a way that you answer the question A question will often say at the end simply Advise A, or B, or C, etc. The advice will usually turn on the individual answers to a number of issues. The point made here is that the final paragraph should pull those individual answers together and actually give the advice required. For example, it may begin something like: The effect of the answer to the issues raised by this question is that ones advice to A is that Make sure that you have answered the question completely. If the question says Advise A, B, C and D, dont leave D out. Dont get diverted into discussing advice to parties whom you are not required to advise.
We at Holborn College wish you the very best.
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CONTRACT LAW

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Module Planner LLB (Hons)

Core Module: Aims

HOLBORN COLLEGE Indicative lecture Outline

Contract Law A Brief Outline

What becomes binding in a contract?

When is a contract fully discharged?

How to Use this Planner

HOLBORN COLLEGE Learning Outcomes

HOLBORN COLLEGE HOLBORN COLLEGE

Part 1: Study Unit One Part 1: Study Unit One

Essential Reading Essential Reading

Learning Outcomes Learning Outcomes

Sources of Law Sources of Law Case Law

UNDERGRADUATE PROGRAMME UNDERGRADUATE PROGRAMME

CONTRACT LAW CONTRACT LAW

HOLBORN COLLEGE HOLBORN COLLEGE

Part 1: Study Unit Two Part 1: Study Unit Two

Learning Outcomes Students will be expected: Learning Outcomes

Sources of Law Sources of Law Case Law

Acceptance Case Law by conduct

UNDERGRADUATE PROGRAMME UNDERGRADUATE PROGRAMME

CONTRACT LAW CONTRACT LAW

13. 14. 15. 16. 17. 18. 19. 20.

HOLBORN COLLEGE HOLBORN COLLEGE

Part 1: Study Unit Three Part 1: Study Unit Three

UNDERGRADUATE PROGRAMME UNDERGRADUATE PROGRAMME

CONTRACT LAW CONTRACT LAW

HOLBORN COLLEGE 15. 16. 17. 18. 19. 20.

HOLBORN COLLEGE HOLBORN COLLEGE

Part 1: Study Unit Four Part 1: Study Unit Four

Sources of Law Case Lawof Law Sources

HOLBORN COLLEGE HOLBORN COLLEGE

Part 1: Study Unit Five Part 1: Study Unit Five

HOLBORN COLLEGE HOLBORN COLLEGE

Part 1: Study Unit Six Part 1: Study Unit Six

To have learned the parol evidence rule and its exceptions.

UNDERGRADUATE PROGRAMME UNDERGRADUATE PROGRAMME

CONTRACT LAW CONTRACT LAW

HOLBORN COLLEGE 19. 20.

HOLBORN COLLEGE HOLBORN COLLEGE

Part 1: Study Unit Seven Part 1: Study Unit Seven

Sources of Law Statutes of Law Sources

HOLBORN COLLEGE HOLBORN COLLEGE

Part 1: Study Unit Eight Part 1: Study Unit Eight

Sources of Law Sources of Law Statutes

HOLBORN COLLEGE HOLBORN COLLEGE

Part 2: Study Unit Nine Part 2: Study Unit Nine

Sources of Law Sources of Law Case Law

Incorporation Case Law of exclusion clauses Incorporation of exclusion clauses

UNDERGRADUATE PROGRAMME UNDERGRADUATE PROGRAMME

HOLBORN COLLEGE HOLBORN COLLEGE

Part 2: Study Unit Ten Part 2: Study Unit Ten

Essential Reading EssentialContract Law, Cracknell Relevant Chapter(s) Obligations: Reading

Sources of Law Sourcesand Regulations Statutes of Law

UNDERGRADUATE PROGRAMME UNDERGRADUATE PROGRAMME

CONTRACT LAW CONTRACT LAW

HOLBORN COLLEGE HOLBORN COLLEGE

Part 2: Study Unit Eleven Part 2: Study Unit Eleven

in law? The both common in law? The both common

Misrepresentation Act 1967 Statute Misrepresentation Act 1967

HOLBORN COLLEGE HOLBORN COLLEGE

Part 2: Study Unit Twelve Part 2: Study Unit Twelve

Essential Reading Essential Reading