Find the difference between a contract and an agreement. A contract is a legal agreement between two or more entities, enforcing an obligigation to do something or to retrain from doing certain things. But all legal agreements are not contracts.

Any agreement is to be considered legally binding and becomes a contract when three becomes a contract when three conditions are met. The condition are offer and Acceptance, intention to create relation and consideration. If any of these conditions are not met then contract is not legally binding and it cannot be enforced on the other party.

An agreement refers to meeting of minds at a certain point. Agreements may be form a business commercial or domestic view. If the agreement is not legally binding it cannot be enforced by law.

An agreement becomes a contract when it is made legally binding and on meeting the three conditions

When partners enter into an agreement, terms and conditions are agreed among themselves, where as in some specific contracts, terms and conditions are implemented by law.

The remedies for breach of contract and of an agreement are totally different.

Find the source of the law of contract.

It is actually a body of many laws emanating from many sources.

These sources of law include:-

1.) Common law, it is also known as case law, this is law found in the decisions of the courts rather than in statues judge made law, whenever a court renders a legal decision that decision becomes binding on the court and its inferior courts when the same issues again in future, this decision made by the courts is known as the doctrine of stare dec….. which means standby precedents and do not is disturb settled points.

Common law is fluid always changing with societal values and expectations.

Statutory law, the legislative branch is responsible for creation of law legislative possess the authority to modify, abolish or adopt common law.

Administrative law, these are government units which administer the affairs of the government. There are actual two types of agencies, admistratvive and regulatory.

The administrative put into effect government programs, while regulatory is to oversee and regulate, both receive their powers from the legislative branch because legislative don’t posses the time or the expertise to write procure statutes, they often enact a very general statute, which grants one or more administrative agencies to make more precise laws .Administrative laws are known as regulations court rules; just as administrative agencies need authority to fill in the gaps of legislation so do courts to fill in the gaps left by legislatures, the court has adopted court rules which also govern civil and criminal processor court rulers may not conflict with legislative mandater, if a rule does, the statute is controlled. Most court rules are drafted under the direction of the highest court and becomes effective either by vote of the court or after being presented to the state legislative for ratification.

Constitutional law, it usually has a major impact on the legal system and our society as a whole. No law may be passed or enforced if they are in conflict with the constitution .

Find the significance importance of the law of contract

Contract law server as the foundation of our entire society. The society depends upon free exchange in the marketplace at every level and contract law makes the possible.

Exchanger in the market place always depend upon voluntary agreement between individuals or rather legal persons, such voluntary agreements could never work without contract law.

Contract law serves to make these agreements enforceable which means that it allows one party to a contract to obtain money damager from the other party upon showing the breach of a contract.

Contract law has made there voluntary agreements become workable and practical.

What is contract?

Treitel ….: defines a contract as an agreement giving rise to obligations which are enforced or recognized bylaw, the factor that distinguishes contractual from other legal obligations is that they are based on the agreement of the contracting part.

Pollock : defines a contract as a promise or a set of promises which the law will enforce

Anson says that the law of contract may be defined as the breach of the law which determines the circumstances which a promise will be legally binding on the person making it.

Types of contracts.

Written contracts, the insists they must be written, must be embodied in a formal document eg three purchase insurance sell of land.

Contract requiring written evidence, they must be evidenced by some note or memorandum, the memorandum must describe the parties effectively and also describe the subject matter, consideration and may also contain signatures of the involved parties.

Simple contracts is an express or implied agreement creating legal rights and obligations it needs not to have any special form as it can be entirely oral, written, partially oral, written or merely im…. From conduct, it must be supported by a valuable consideration otherwise it is void.

Terms used in contracts.

Binding- its one that the court will enforce if one of the parties contract defaults, An agreement is not binding on the parties unless the parties intended to create legal relations.

Void contracts :It does not have legal effect ie not a contract such an agreement does not confer legal rights on the party.

A contract is void under the following circumstances

Absence in one of the element of a contract

Where the contract lacks the necessary from eg should be in written and is not.

Certain contract made by minors eg lending minors money

Illegal contact contrary to the constitution.

Vouelable contract : It is valid initially but may be brought to an end/ Avioded at the option of one of the parties the right to avoid is given to an innocent party.

Unenforceable contract :These are contracts that are valid by unenforceable at law because of absence of evidence of the contract, this means only persons who have any rights or obligations under a contract are those who are privy to the contract. There are exceptions to this, trust relationship, Agency relationship.

Essentials of a valid contract.

Must have an offer and acceptance

Must have intention to create legal relations

There must be consideration

The parties must have capacity to contract

It must be legally binding

Offer.

A contract comes into existence when a definite offer has been unconditionally accepted, the party making the offer is called the offer or, the party accepting it is the offence.

An offer is an intimation by words or conduct of a willingness to enter into a legally binding contract specifying the terms of the terms of the agreement which will be formed, should the offer be accepted by the party to whom it is addressed.

Rules governing offer.

An offer may be made orally, writing or by conduct

Merely giving information does not constitute to an offer.

Harvey Vs Facey (1873) the plaintiff telegraphed “ will you sell bumper hail pen? Telegraph the lowest price. The defendant replied by stating “lowest price is $ 900)”

The plaintiff telegraphed stating “ we agree to buy bumper hall pen at $ 900 started by you please send the title deed”

The court held that the defendant was merely answering a request for information and did not give an offer which could be accepted.

May be made to a definite person or definite persons in which care only the person /persons may accept /or to the whole world at large where it may be accepted to nay person complying the terms of the offer.

An offer is specific it directed to a person /or group or it can be general if accepted b y anyone who comlies with the terms of the offer carlil Vs Carbollive smoke ball company (1893)

In this case carbollice smoke ball company made a product collect smoke ball it claimed to be a cure for influenza and a number of other diseases, the company published advertisements in the press…………………………………………

The product according to the instructions set out in the advertisement (“$ 100 award will be paid to any person who contracts the increasing influenza colds or any disease caused by cold, after having used the ball 3 times daily for 2 weeks according to the printed direction supplied with each ball.

A thousand pounds is deposited with Alliance bank showing our sincerity in the matter”

Mrs Carlill saw the advertisement, bought one of the balls and used it in accordance with the instructions. She contracted the flu and claimed the $ 100 from the company, the company refused to pay her and she brought a claim to court, she contended that the adv and her reliance to it was a contract between her and the company and ought to pay, the company argued that it was not a serious contract. The court of appeal rejected the company’s argument and held there was a fully binding contract of $ 100 with Mrs Carcill among the reasons given b y the 3 judges

The advert was a unilateral offer to the whole world.

That satisfying conditions for using the smoke ball constituted acceptance of the offer.

That purchasing the smoke ball or using constituted good consideration because it was a distinct deter….. incurred for the benefit of the company and further, more people buying the smoke ball by replying on the advert was a clear benefit to

That the company claim that it $ 1000 was deposited at the alliance bank showed the senour intention to be legally bound.

The offer must be communicated to the offered a person can’t accept an offer that be doesn’t know exists.

Taylor Vs Laird (1856) in this case during a voyage the plantiff gave a command of the defendants ship but helped t o work it home and claimed payment for this, it was held that there was no contract as he had not communicated his offer to do his work.

The offer must be firm Farina Vs Fickus (1900) A father wrote to the man who was about to marry his daughter stating that his daughter will derive a benefit under his will, this letter was held to be an expression of intention and not a firm offer capable of acceptance.

The offer may attach any condition to the offer but they must have been communicated to the offered before they bind him b y the acceptance of

the offer. The offeree cannot bind the other party without his consent eg writing to someone saying if I don’t hear from you within a week I will consider the house is mine for a million shillings.

Terms of the offer must be certain Scammell (G) & Nephew Ltd Vs Ouston (1941) Ouston (p) wrote to the defendant company (D) ordering a comer motor van, stating that the order is given on the understand, that the balance of purchase price can be on h ire purchase term………………….agreement between the partner. The trail court and the court of Appeal decide that there was a contract between the parties, and D appealed to the house of Lords. It was held that there was no contract as the phrase on hire purchase was too vogue the constitute a binding agreement.

An offer must be distinguished from an invitation to tret /bid .An invitation to treat is an invitation to person to make an offer or to negotiate . The acceptance to an invitation to treat will not create a contract.

a) Display of goods

b) Advertisements

c) Tender

d) Auction

Display of goods Ersher Vs Bell (1961) IQB A shopkeeper displayed a thick knife in his shop window stating “Ejector 4 cents” He was charged for offering the knife for sale contrary to sec (1) of the restruction of offensive weapons cents of 159.It was held that the display of goods on a shop window with a price ticket was merely on lit and not an offer for sale and hence no offence had been committed.

Pharmaceutical society of great Britain Vs Boots cash chemist (1953) 1 Q B 401, Boots was charge d with an offence under the pharmacy and poisons in Part 1 of the poisons list. Take place under the supervision of the registered pharmacists, boots operated to self service and pharmacist at the cash desk was authorised to prevent the removal of nay drug from the premises. The fact or determines whether an offence was committed war the point at which a sale in this self service store took place, the court of Appeal held that boots had not committee no offence, the display of gods on a supermarket shelves was merely an invitation for customer to bill.

Advertisement, general pattridge Vs Crittendnden (1968). The plaintiff had placed an advertisement in a periodical indicating that he had certain wild birds for sale,

it was an offence to offer such birds for sale, the advertisement stated the price but gave no details of delivery.

It was held that the advertisement was an invitation to trea and not an offer to sell.

A unilateral contract is where one party binds itself to perform a stated promise upon performance of the requested act condition by the promise.

However the promise giver no committement to perform the act or condition or rather is left to choose whether to perform or not.

If a re ward is advertised, to the performance of a certain act, the advertisement will constitute a unilateral offer. The acceptance of such an offer is the performance of that act and it cannot be accepted by making a promise.

Where as the general rule is that an acceptance must be communicated to the offer or the offer or may impliedly waive this requirement and will be taken to done so if the offer is unilateral un less there has been an express indication of the fact that notification is required. In a unilateral contract the requested act is both the acceptance and the consideration of the promise. Since acceptance is the performance of the stipulated act and performing this act might be a continuing act, the general principle should be that the offer may be revoked anything before the act is fully performed however in a unilateral offer its impossible to revoke once the offence has started to perform. Although the general role is that the revolation of an offer

In the case of a unilateral offer to the whole world since its impossible to identify the potential offences. Revocation is sufficiently communicated using the same channel that was used in communicating the offer.

Tenders

The request for tenders is a negotiating device common in the world of major commercial contracts A company seeking to purchase a major item or service, such as a piece of equipment or some construction work will invite tender from those interested in supplying the goods or services sought. Such an invitation maybe published generally or in a trade journal, or circulated to companies likely to be interested. The invitation for tender is not threaded as an offer, since the company issuing it may have criteria other than price which it wishes to take into account in awarding the contract. Spencer Vr Harding (1870) LRS (P 561) D sent out a circular. We are instructed to offer certain business stock ) to the wholesale trade for sale by tender ps tender for the stock was the highest that D received , but D refused to accept it. Ps contention was that the circular amounted to an

offer and contained a promise to sell to the highest bidder. The court held that there w as no tender.

The person requesting the tenders has the freedom to determine which (If any) they will accept.

Exceptions where the request can also constitute an offer. There are however situations where the request to submit tender can also constitute an offer which, it accepted, will form a binding contract contains a specific promise.

Express contractual promise to accept the most competitive bid in Harvela Investments Ltd V Social Trust Co Canada Ltd sought a single offer for the whole plot from each of two interested parties, promising to accept the highest offer provided it met other condititions stipulated both parties submitted bids complying with the conditions, but while one merely stated a pure it war prepared to pay, the other stated both a concrete sum and a referential bid. The question for the house of Lords war when of the two bids was the higher, thus constituting the acceptance necessary for the formation of the agreement. The plantiff claimed that the second dependants b id war not valid as it was not within the terms of the original invitation to bid ( because it was not a single offer.

The plaintiff succeeded in their action and the house of Lords restored the original decision in the plaintiffs favour.

Contractual obligation to consider tenders which confirm to the bid conditions . In Blackpool and fylde Aero Club Ltd Vs Blackpool Borough counal (1990).The defendant council owned an airport, from when it permitted an air operator to run pleasure trips. The concessions and on the expiry of the last concession, the council invited the club and fix other parties to tender for the rights to operate pleasure flights from the airport. A very clear procedure for submitting bids was laid down b y the council, and it was stated that tender received afternoon, 17 March 1983,would not be considered. Only the plaintiff club and two others responded to this invitation. The plantiff’s tender was put in the town hall letter box hour before the deadline, but due to an oversight, the letter b ox was not cleared by council staff that day as it was supposed to be. The council accepted that this was due to administrative. The plaintiff tender was recorded as late and was therefore not considered. The club contended that the council was contractual beyond its sought damages from the council. The court of Appeal held that the council was liable in damages to the club for breach of contract.

Auctions

Where an auctioneer asks for bids, he is not making an offer to sell the goods to the highest bidder .It was established in Payne Vs Care (1989) that the auctioneer is merely inviting offers for bidder, which he can other accept or

reject. This rule is now encapsulated in 57 (s0 of the sale of Goods Act 1979, which starts. A sale by auction is complete when the auctioneer announces its completion b y the fall of the hammer,orin other customary manner; and until the announcement is made any bidder may retract nor bid.

In the case of Harns Vs Nickerson (1873) the plaintiff failed to recover damages for loss suffered in travelling to the advertised place of an auction sale which was ultimately cancelled. His claim was condemned as an attempt to make a mere declaration of intention a binding contract.

Does an auction sale without reverse constitute a definite offer to sell to the case of Waslow Vs Harrison (1859) the action in this case failed both in the queen’s bench and in the court of Exchequer chamber were of option that he would succeed if he brought a fresh action pleding that the aunctioneer, by his advertisement had implicity pledged himself to sell to the highest bidder.

In Barry Vs Devies heathcore ball & Ltd [2007]. The court had no doubt that an auctioneer who stated that an auction was without reserve entered into a collateral.

The care concerned the sale of two machines at an auction without reserve. The plaintiff was the only bidder for the two machines, worth about $14,000 each. The auctionees withdrew the machines from the sale on the basis that the bids (of $200 for each machine)were too low. The plaintiff claimed damager representing the cost to purchase the machines elsewhere less the amount of his auction bid.

Termination of Offer

An offer comer to an end in the following ways

- On death of either the offerer or offeree before acceptance

Duff’s executors sale(1886) having been offered shares in exchange for other duff died and his executors purported to accept the offer, it was held that the offer duff’s death.

By non acceptance within the time fixed for acceptance of within a reasonable time where no time limit is prescription

Ramrgate Victoria hotel vs Montflore[1866] on 8thJune the defendant made an offer to take shares into the hotel this was accepted on 23rd November it was held that the 5month interval was unreasonable and the offer had lapsed.

Revoked before acceptance Offord Vs bavier (1862) The defense guaranteed to secure money advanced to a 3rd party on discount for to space of 12 calenda months. The court held that the offer could be withdrawn within a specific period

unless it had been accepted upon. The renovation of an offer must generally be communicated to the 3rd party revocation of an offer must be communicated to the offence before acceptance, it might be made to the offer or indirectly and it is of no effect until it Vs actually brought to the notice of the offence .(Henthom Vs Fraser (1872).

There was some offer to buy some houses which was handed to the plaintiff by the defendant’s secretary. About midday the following day, the secretary ported a withdrawal letter which did not reach the plaintiffs had home until 5pm.

Meanwhile at3.50pm the plaintiff had ported an acceptance letter which was received at 5pm when the offices where closed. The secretary opened the letter the following day, the defendant refused to accept the offer and the plaintiff sued for specific performance when the defendant refused to sell the house, the court of appeal emphasized that the postal rule applied to acceptance, it was held that the revocation was not communicated and therefore a contract existed.

Offer may be rejected by the offence communating his rejection to the offer or. Rejection or refusal of the offer causes it to lapse. The offence cannot change his mind later and accept unless the offer or is willing to make a fresh offer.

An offer lapser when a counter offer is made. Hyde Vs Wrench (1840) The defendant offered to sell the estate to the plaintiff to $ 1000 on 8 th June in reply the plaintiff made an offer of $950 which was refused on 27 th June . Finally on 29th June the plaintiff wrote he was prepared to pay $1000 it was held on contract existed in his letter of 8th June the plaintiff and rejected the original offer of $ 1000 and made a counter order of $ 950 no loner able to a subsequent acceptance.

Where acceptance of the offer is not made in the special manner required if any the offer will lapse.

Acceptance

An acceptance Is the final land unqualified expression of the assent to the assent to the terms of the offer ie it must be unconditional if an acceptance is subjected to condition this amount to a counter offer which terminates the original offer.

Rules governing acceptance

Acceptance must be communicated and mere intention to accept it is not sufficient.

This rule is subject to the following exceptions

Where the offeror expressly or impliedly waives communication eg in a general offer which requires mere conducts as acceptance.

Where the contract is made by post or post is envisaged as the means of communication, here the acceptance is as the means of communication, here the acceptance is complete as soon as it is ported, provided the letter is swell stamped and addresses .In such a case it does not matter whether the letter is lost the past or never reaches the offeror.

An acceptance of an must be absolute and unconditional where the acceptor varies the terms of the offer which amounts to a counter offer.

Acceptance must be communicated to the offerer in the manner prescribed.

Acceptance must be mad within the time prescribed by the offeror and if there is no time is specified, then within a reasonable time.

Acceptance of an offer by sending of a letter N complete once the latter is posted. This applies when the letter is delayed in past or is lost entirely or does not reach the offeror. Adams Vs Lindsell (1818) the plaintiffs were woolen garment manufacturers while the defendants wrote to the plaintiffs offering a quantity of wool with certain terms and requiring an answer in the form of post.

The defendant misdirected their letter of offer and did not reach the plaintiff until the evening of 5th Sept. The plaintiff posted the letter of acceptance on the same night which was delivered to the defendant on 9 th

Sept. If the original offer was properly addressed the reply was required on 7thSept, the defendant sold to a third party was required on 7th September, the defendant sold to a third party on 8th Sept, the court held there was a binding contract between the parties because the offen was accepted immediately on being received.

Acceptance once made cannot be revoked.

It is not permissible for the offeror to bind the other party to a contract by stating the later silence shall be taken as acceptance.

Agreement on acceptance can be inferred from conduct. Brogden Vs Metropolotan Railways Co. (1877) Brogden had suggested to the railway that they should enter into a formal contract for the supply for coal. The company sent the terms of agreement.

Brogden sent the name of an arbitrator to settle any differences before writing approved.

The manager then ordered and received coal on the basis of the arrangements in this .

It was held that by inserting the name of the arbitrator brogden had rejected the offer and made a counter offer this counter offer was accepted by the company by ordering and taking the delivery of the coal upon the agreement, there was therefore acceptance through conduct. Stexenson Jacq ues & Co Vs Mclean (1880). The defendant had made an offer to sell iron at Kshs.40 net cash per ton to the plaintiffs and stated that be would hold the offer open until the following Monday, the defendant sold the iron and informed the plaintiffs of this by a telegram sent at 1:25pmbefore this arrived at 1:46pm the plaintiff sent an acceptance telegram to the defendant at 1.34pmthe plaintiffs brought an action for non – delivery.

It was held that through the defendant was free to revoke his offer before the close of the day on Monday any revocation would not have effect until it reached the plaintiff consequently, the defendants offer was still open when the plaintiff accepted it at 1.34pm on sending the telegram.

Acceptance must be made in response to the offer.

An offer is not accepted by doing the required act in ignorance of the offers, if the offence responds in knowledge has motive in doing so is irrelevant Vs Clarke (1927) A reward was offered by a government of Western Australia for information leading to the arrest and convictions of the persons who committed the murder of two police officers Clarke are this information after he had been arrested intension was to save himself from an unfounded charges so that he had acted on the faith of 1 in reliance upon, the offer. The jury said that the plaintiff gave information to ease her conscience and not ……

But the judgement was upheld in the kings bench. Motive was irrelevant, provided the act was done in knowledge of the reward. Acceptance was then related to offer.

Gibbons Vs Pructor (1891) On 29th May, the defendant had offered a reward of $ 25 to the person who gave information leading to the conviction of the perpetrator of a particular crime, to police superintendent. The plaintiff, a police officer, had already communicated the required information to the collegue named cappin, with inst ructions to forward it to superintendent.

Coppin had communicated the information to its superior, inspector lennon, who had passed it on the superintendent. The information reached superintendent on 30th May.

It was held that the plaintiff was entitled to the reward. Coppin and lennon were the plaintiffs agents for the purpose of conveying the information .The terms of the offer required the information to superintendent and at that time the plaintiff knew that a reward had been offered.

Instantaneous methods of communicating acceptance where an acceptance is instantaneous actual communication is required an the portal rule does not apply.

Instantaneous acceptance can be by telephone ,telefax or email

In Entores lts Vs m…. far east corporation (1955). An English company received a telex after from a Dutch company and made a counter offer which the dutch company accepted by telex. The English company needed to establish that the contract was made within the jurisdiction, it was held since the acceptance was made within the jurisdiction, it was held since the acceptance was received in England the contract was made within the jurisdiction in Brinkibon Ltd Vs stahag Stahl (1983) the facts were for all practical purposes identical save that the offer was made by telex in vienna and accepted by a telex message fromLondon to Vienna the House of Lords held that the contract was made in Vienna.

Does the postal apply to acceptance message sent by electronic mail?

This may depend on precise method of transmitting and whether for eg the parties communicate via common server, whether the messages are sent to the recipient server or whether they are stored before dispatch given these many variable it is advisable to avoid postal rule and require actual receipts.

CONSIDERATION

A promise is not as a general rule binding to a contract unless it is supported by some consideration. The traditional approach is to identify consideration as a determine to the promise and a benefit to the promisor.

Currie Vs Misa [1875] a valuable consideration in the sense of law may consist either in some right, interest, propt, benefit accruing to one party or some forbearance detriment, loss, responsibility, given, suffered or undertaken by the other party.

The second approach to consideration definers it as the price requested by the promisor’s promise was bought. Dunlop prematic Tyre Company Vs Selfridge & co. Ltd [1915] Act or forbearance of one party or the promise thereof is the price for which the promise of the other is bought and the promise thus given for value is enjoyable.

Ruler governing consideration

There are 3 types of consideration

Executory this is a promise that confer a determent or enjoys the profit at a future time.

Executed this is completely performed by one party once the contract has been entered into.

Part this is executed before the contract is entered into and it is generally not recognized to support a contract.

Collins Vs Godefry [131] The claimed was …………………………… to attend a court rearing to give evidence on the defendants behalf and he later alleged that the ………………… had promised to pay him 6 guinea for his trouble it was held that he could not recover the …………… since he was already consider.

If a promise is ready under a legal obligation towards the promise the consideration inadequate. If a person either does or promise to do what they are legally bound to do in exchange of promises suffer no legal detriment and confer no legal benefit so that this doesn’t constitute to sufficient consideration.

Williams Vs roffey Brother & Nicholls contractors Ltd [1990] The defendants were building contractors, engaged to refus………………. 27 flats. The claimant was engaged to carry out the carpentry work for $20,000.The defendants were operating under a penalty …….. in the main contract. I became apparent that the daimant would have difficulty finishing the contract at the price stated. It was therefore agreed in April 1980 that he would be paid a bonus of $575 per flat completed after that sate. By the end of May 198 the defendants had made only one further payment of $1500 ……….. though a further eight flats had been completed. The daimant cease work and the defendants employed other carpenter to finish work. The daimant claimed $10,847. The defendant argued that this was only payable after completion of the work. The court held that there was sufficient consideration to make the defendant promise enforceable.

Dunlop preumatic tyre Ltd V selfridge & Ltd [1915] Dunlop made tyres. It did not want them sold cheaply but to man train a standard retail price. It agreed with its dealers not to sell them below its recommended retail price. It also bargained for dealers to get the same undertaking from a purchaser. If retailer did sell below the list price, they would have to pay $5 a tyre in liquidated damages to Dunlop. When Selfridge sold the tyres at below the agreed price Dunlop sued to enforce the contract by injuries and claimed damages. At trial it was in favour of Dunlop, but in ……………………………………………………………………………………………..

If the promises is already under a public duty there is no consideration. In Shil Vs Myrie [1809] the captain of a ship promised the crew if they shared the work between them the work of two sea men who deserted the wages of the deserter will be shared between them, it was held the promise was not binding because the sea men were given no consideration and were contractually bound to do extra work to complete the voyage

The excephons to this rule,

i. If a plaintiff performs more than his existing duty

Glassbrook brothers ltd Vs Glamorgan country council [1925]

The police were offered $2200 to provide a special guard for a coalmine during a strike. It was held that they could recover the amount when the owner refused to pay because the special guard went beyond ordinary police duty to protect.

ii. When the change circumstances destroy the original contract thereby freeing the parties from the original contract

Hartley Vs Ponsonby Ltd [1857] in this case a ship crew was seriously depleted after a no. of desertions, the captains promised extra pay to the remaining people if they dangerous to put a sea ship so under manned the sea men were not obliged to do this under there contract of service. And they were free to enter another contract in the remaining part of the voyage.

iii. When a person contractually bound promises to perform the some act for another person Shadwell Vs Shadwell [1860] after his engagement to Elen Nicholl the plaintiff received the following letter marriage to Nicholl and as I and promised to help you in the starting I am happy to say I will pay you $150 during my life and until your annual income derived from your profession of chancery barrister shall amount to 600 gainer. The plaintiff claimed arrears in this yearly sums from the under executors alleging the consideration to be his marriage to Ellen Nicholl. It was held the promise was binding because it was supported with sufficient consideration.

2. Consideration need not be adequate or equivalent to the promise but it must be of some value. The court will not question whether the valu is adequate and will not interfere with the fairness of the bargain made by the parties.

White Vs bluetl[1853]bluett had given his father a promissory note (to acknowledge debt) for money that his father had lent him. His father’s executors sued him on the note and he claimed in his defence that his father

had promised to discharge him for the obligation if he would stop complaining about the distribution of his property among his children. It was held that bluett had not provided any consideration for such a promise but his father he was under no legal duty to retrain-from complaining and his forbearance could not amount to consideration.

Hamer Vs Sidway [1891] an under promised his nephew 5000 dollars if the nephew would retrain from drinking lequior, using tobacco, swearing and playing cards or billiards for money until he should become 21years of age. The nephew complied but the under’s executors refused to make payment sufficient consideration to claim. It was held that the consideration by restricting his lawful freedom of action.

3. consideration must be legal e.g a promise given in consideration of

an agreement to rob a bank would be void because the consideation itself is illegal.

4. consideration must move from the promise, Tweddle Vs Alkinson [1861] it was firmly established that a stranger to a consideration cannot sue to a contract only parties to a contract have obligation under it.

i. Actions by beneficiaries under a trust

If the facts shows that the person entitled is a beneficiary he may sue under the trust himself thou not under the contract

ii. The principal even if under closed may sue on a contract by an agent

5. consideration must be possible the law will not enforce the contract which is beyond the power of a human being.

6. consideration must no be passed any act craned out before a promise is made cannot be a sufficient consideration to support the promise because it is not carried out in exchange of the promise Re mac Adle [1951] The testators widow had a life interest in a property that was left upon trust for the testers 5 children. In 1943 improvements were craned out to the property and paid for by one of the children’s wife in 1945 after this work was completed the 5 children signed a document addressed to of your carrying out of alteration and improvements to the proper we the beneficiaries shall hereby agree that the executors shall repay to you from the said estate, the sum of $488 in settlement of the amount spent on

the improvements. When the testator’s window died the wife claimed this sum under the agreement held that since the work had between completed before the agreement of 1945 the consideration for it was passed and the agreement was unenforceable.

Prior request device

There is a device which can be employed by the court to avoid the literal nature of past consideration rule and to allow such promises to be enforced. There must be aprior request to carry out the act which carries with it a promise to pay or benefit the performed of the act income way. Pao on V lau yin long [1980]

PART PAYMENT OF A DEBT

Where a creditor promises to accept a ………………………. Than is due homa debtor and promises to not sue to the balance there is a (debt contract). In pinnel care, the court of common pleas held that in such circumstances the debtors must provide consideration for the creditors promise to release him. Simply paying a smaller sum than that owed will not be sufficient since the debtor has done only what was legally obliged to do anyway. Under the debt contract traditionally the factual benefit that might accrue the creditor from securing some payment rather than anything at all, was not considered sufficient and some separate consideration for the promise to forego the balance if accepted by the creditor since the court will not inquire in the adequacy of the consideration.

Payment before the due date is a good consideration as is payment by a different place as long as the change of venue is at the creditors request foaker Vs Beer (1884). In August 1875 Julia Beer had obtained a high court judgment against doctor foaker for $2090 it was agreed in writing that if doctor foaker paid 1500 immediately and $150 on two occasions each year she will not take any proceedings whatever on the said judgment. As a judgment debtor Dr foaker war unable to pay he interest that had accrued on the judgment debt but the agreement had not mentioned this Dr. Fakes paid the judgment debt in accordance with the agreement but Julia brought an action claiming and interest.

The question was that did it include Dr. foakes paying the interest, it was held that Dr. Foakes had not provided any consideration for Julius promise not taking any proceedings of the judgment so the promise was enforceable.He had only done what he was legally bound to do.

Hirachand Vs Temple [1911] …………… temple had borrowed money from the plaintiffs, money lender and had given a promissory note. The plaintiff had pressed temple for payment having no success they had informed his father the

father sent a draft for a smaller sum than that due on the promissory notes in full satisfaction of the sons debt the plaintiff conked the draft but brought on action on the note against temple seeking the balance on the debt.

It was held that this action could not be maintained.

PROMISSORY ESTOPPEL

If a creditor promises to accept a smaller sum in fully settlement intending the debtor to rely on that promise and the debtor relies on it the debtor may have defense of promissory stopped when sued by the creditor for the balance. The promise will in this way be enforced despite the absence of consideration to support it.

Central London property trust V high trees house Ltd (1947

The plaintiff leased a block of flats to the defendants at a rent of $2500 per annum shortly afterwards war broke out as a result of which many of the flats tell vacant. Because of this, the plaintiff agreed in January 1940 to reduce the rent by one half to 1,250 this reduced rent was paid by the defendants from 1940 to 1945 when the war ended and the fats were full once again. The plaintiffs dammed rent at the original rate of $2500 per annum. They tested their claim by using for the rent covering the last quarter of 1945.

higher vs metropolitan railway co. (1877)

The plaintiff a landlord gave the defendants, his tenant .. months notice to repair the premises, failure to do to do which would lead to for future of the lease the notice war given in October . In November the plaintiff opened negotiation with the defendant for the vale of the plaintiffs interest in the premises. The negotiation broke off on December 31st. In the mean time the defendant had not carried out any repair work or per the October notice. When six months lapred from the date of the notice , the plaintiff daimed that the defendant leave was forfated and soughted to have him ejected. The opening of the negotiations amounted to promise on the plaintiff’s part that as long as the negotiations continued he would not enforce the terms of the notice; and it war for this reason that the defendant had not carried out the repairs.The six months wre to run only from the time when the negotiations failed, and as such the plaintiff was not entitled to eject the defendant.

Conditions in which promissory stopped will operate;

i. There must be a clear and unequivocal promise or representation that existing legal rights will not be fully enforced.

Woodhouse AC Israel Cowa Ltd Nigerian Produce Marketing company [1972] a sale contract provided for payment in Nigerian pounds in lagos. The buyer had asked if the seller would be prepared to accept sterling in lagos the seller replied n 30th September 1967.

The pound sterling was devalued that it was worth 15% less than the Nigerian pound. The buyer agued that the seller letter that they make payment insterlina in lagos for the seller were stopped from going back it was held to find a promissory stopped it had to be clear and unequivocal (to be understood the way required) the seller representation was not sufficiently precise to amount to the venation of a contract or to find an stopped.

ii. Promissory stopped can only be used as a defense and not as a cause of action Combe Vs Combe [1951]

An exhurband promise to pay an ex wife $10 free of income tax. However he failed to pay and six years later the wife brought an action claiming the arrears she had given no consideration for her husbands promise free she had not applied to the divorce court for maintenance and had not retrained from doing s at her husband request it was held that the husbands promise was clear and intended to be binding and acted upon and it was acted upon by the wife. The court of appeal allowed the husbands appeal and held that the wife had provided no consideration for the husband promise and could not rely on promissory stopped which did not give rise to a cause of action.

iii. The representation or promise made is birding and upon and war infact acted upon W Y Alan & Co. Ltd Nasr Export & Import Co. [1972]

iv. It must inequitable to allow the promisor to go back to his promise D&C Builder Ltd Vs Rees [1966] In 1964 July the defendant Owen the plaintiff Builders $482. In Nov the defendant had still not paid the plaintiff was in desperate financial straits and it was alleged that the defendants wife knew this when she offered to pay $300 in full settlement, indicating that if this was not accepted the plaintiff would get nothing the plaintiff said they had no choice but to accept a cheque of $300 in completion of the account. The plaintiff then claimed the balance Lord dinning examined promissory stopped and held that it could not apply in thus case since the promise was not freely given it was not inequitable for the plaintiff to go back on has promise.

v. The doctrine merely suspends rights, it does not extinguish them. Tool metal manufacturing Co. Tungsten electric co. Ltd(1955)

In 1938 the tool manufacturing co. Ltd who owned certain patents entered into a formal agreement with the Tungsten electric Co. Ltd where by T.M.M.C gave T.E.C a licence to deal in the products protected by the patent until 1947, terminable by six months notice in writing on either side, in consideration of T.E,C.Os paying a myalty of 10 per cent on the net value of all contract by T.M.M.C clause 5 of the agreement material used by T.E.C.O exceeded a quota of 50kilograms, TECO should pay to T.M.M.C compensation equal to 30percent of the net value of the excess contact material after the war tool metal sought to reinstale their right to claim compensation .

The house of Lords held that tool metal right to claim compensation had been suspended. This right could be reinstated by giving reasonable nature of their intention to enforce their right.

Baird textile holding Ltd Vs Mark & Spencer PLC [2001]

The claimant B had supplied garments to the defendant M&S for 30years, When M&s terminated the agreement with effect from the end of the then current production season. B brought an action against mand arguing that:

1. The termination was in breach of a contract which would be implied from the long standing relationship between the parties that obliged M and S to continue to place orders unless and until the contract was ended by gluing reasonable notice and B contended that a notice period

2. M and S were stopped from giving less than three years notice.

The court of appeal held that the alleged contract obliging M and S to continue to place orders with B failed for uncertainty. The court confirmed that stopped did not create the type of enforceable right daimed by B it could not be used to found a cause of action.

INTENTION TO CREATE LEGAL RELATIONSHIP

An agreement thou supported by consideration is not binding as a contract if it was not made without any intention of creating legal relations.

Intention to create legal relations is dependant upon the parts intentions objectively judged. The traditional starting point for determining this intention is the use of different presumptions.

Domestic & social agreement.

There is a presumption in the above agreements that there is no intention to create legal relation.

1. Between husband and wife Bal four Vs Balfour (1919) the defendants husband held a post in leylon he and his wife returned to England on leave on 1915, However when the defendant returned to leylon in 1916, the plaintiff remained on medical advice in England. Te plaintiff alleged that before the defendant went back to leylon, they had entered an oral agreement by which the defendant had promised to pay $30 a month inconsideration of not calling upon him for further maintenance.

The parties later became estranged and the plaintiff so to enforce the agreement it was held that since it was a domestic agreement between husband & wife it was not an enforceable contact.

Merit Vs Meritt (1970) after the husband had left wife he stated that he would pay her $40 a month from which she had to pay the outstanding mortgage on the house. He also signed a written note which provided that when the mortgage payments had all been he would transfer the ………………………………………………………………………………………..to transfer the house to her it was held that the written agreement was intended to create legal relations between the parties .

The presumption against such an intention did not apply when the both were not leaving in amity but were separate or about to separate.

2. Between parent and child Jones Vs Padavalton (1909) in August 1962, a daughter accepted her mother after to go to England to study for the bar. The agreement was not put in writing was that the mother should pay the fees and $200 maintenance per month. The mother had intended it to be in western Indian dollars ($42) while the daughter thought it was ($70) in us dollars. However she still accepted the payment without objection.

In 1964 the mother orally agreed to buy a house where the daughter could leave and it was agreed that the rent for letting the other rooms were to pay for maintenance in place for the $42 per month. In 1967 the mother claimed possession of the house and at the date of hearing her daughter had not

competed her studies for the bar, and she relied on this agreement as her defense of her possession action.

It was held that the mother was entitled to the possession because it was a family agreement and was not intended to be legally binding it was for too vague uncertain to be considered enforceable as a contract.

Perker Vs Clarke (1960)

Mrs, Parker was the niece of Mrs charke. An agreement was made that the parker would sell their house and move in made that the parkers would sell their house and more in with the Charker. This share the bills and the charkes.

Mrs Charks wrote to the parker the expenses and confirm the agreement.

Mr. charke changed his will leaving the house to the parkers later the couples few out and the parkers were asked to leave. They daimed damages for breach of contract it was held that the exchanged of letter showed that the couples were serious and the agreement was intended to be legally binding because.

1. The parkers had sold their own home

2. Mr. charke had charged her will meaning they were entitles to damager.

Simpkins Vs Pays (1955) The defendant a grant daughter and the plaintiff a paying lodger shared a house. They all contribution 1/3 of the stake in entering a competition in the defendant name one week later a price of $750 was won but the defendant refused to share the price and the plaintiff sued her for it was held that the presence of the outside rebutted the presumption and not intended to be legally binding.

Commercial agreements

There is a presumption of an intention to create legal intention in a commercial agreement. A mere puff is not enforceable because it is not interdict to be take literally and not promissory in nature.

Bower man Vs association of British Travel Agents ( 1996) in this case, the diamantes had booked a school skiing holiday through an ABTA how operators. Before the holiday the operator became insolvent and ABTA reimbursed the holiday costs minus $10 per person representing the insurance premium paid. The deduction was on the basis that the sum was excluded from the ABTA protection …………………………………………………the nature displayed by our operators. The court of appeal held that there was a direct contractual relationship between ABTA and member of the public who booked holidays with ABTA members. The notice was a

contractual after which was intended to be read, and which would be reasonably read by a customer, as obliging ABTA to reimburse the cost of any insurance.

Esso Petroleum Ltd Vs Commission of customer & Excise (1976)

Esso supplied garages with world cup coins in 1970 instructing the garages to give away one win with every your gallons of petrol sold it was sought to subject these coins to a purchase tax on the ground that they had been sold. On the facts it was held that the coins were not supplied under a contract of sale. But the house of lords divided on the issue of whether or not majority Lord divided on the issue of whether or not there was an intention to create legal relations. The majority Lord Simon, Lord Wilberforce and lord fraser, held that there was an intention to create legal relations they placed heavy reliance on the fact that esso envisaged a bargain of some description between the garage owner and the customer.

Letter of comfort.

Sometimes one party sender another a letter of comfort or letter of intent. Whether the writer intends to be legally bound will depend upon the circumstances particularly the wording of the letter and what reliance the recipient reasonably placed upon it.

The letter may be intended …………………….. and WinWord Bensn Ltd Vs Malaysian Mining Corp [1989] M sent out a letter of comfort in respect of a loan which was being made, by K, to one of M’s subsidiaries (legally a separate company for the default of which M could not be legally liable unless they expressly under took legal liability) the letter of comfort stated that it was M’s policy that the subsidiary is at all times in a position to meet its liabilities in respect of the loan,” It was held that the words were simply a statement of the Company present policy. They did not amount to a contractual undertaking. As this was clearly a commercial agreement it wordings of the letter of comfort does not amount to a promise.

Rose & Frank Co. JK Crompton & Brother Ltd [19257] an English Company agreed to sell …………… copy paper in the USE through a new York firm. The marketing agreement was made in writing for a period of three years. The document contain a clause described or an “ Honourable Pledge clause” Which provided that, “this agreement and shall not be subject to legal ……………………………. In the law courts either of the united states or England.

The original agreement began in July 1913 but at the end of the three years period it was extended to cost unit march 1920. In 1919 the English defendants terminated the agreement without giving the appropriate notice as required by the agreement. They also refused to execute orders received by them prior to their termination of the agreement. The court of appeal found that each order

which the defendants were bound to fulfill the claimants failed in respect of future rights however because the parties had specifically declared that the document was not to bring about legally binding consequences.

Jones Vs Vernon’s pools [1938] the diamonds sued to claim money which they had alleged had been won in a football pool. The words “ binding in honuor only” It was held that the statements were sufficient to overturn the presumption and the diamantes failed n their action.

Edwards Vs Skywards [1964]. The diamantes was employed by the defendants as an airline pilot the defendants informed him that they were making him redundant and gave him three month’s notice. By virtue of his contract he was a member of the defendants contributory pension fund and entitled to one of two options on leaving their service – either withdrawing the sums he had contributed to the funds or receiving a paid-up pension taking effect when he was 50years of age. The diamantes professional association acting on his behalf, agreed that if the diamantes chore the first option the defendants would make him an excreta payment amounting to the defendants contribution to the fund. The daimant accepted the agreement. The defendants then paid him his total contributions but refused to make the exgratis payment the diamants sued for breach of contract and won the judge stated that the words “ Exgratia” did not negate a contractual agreement but simply meant that the employer did not admit to any pre-existing legal liability on their port. The diamante accepted the agreement. The defendants then paid his total contributions but refused to make the ex gratia payment. The daimants sued for breach of control and won the judge stated that the words “ex gratia” did not negate a contractual agreement but simply meant that the employer did not admit to any pre-existing legal liability on their port. They ad not discharged the burden of overturning the presumption that there war an intention to create a legal.

Contractual Capacity

The general rule is that any person may enter into any kind of conract however. However there are certain closer of persons to whom the rule apply.

a. Infants & minor

b. Persons of unsound mind and drunkards

c. Aliers or non-citizens

d. Coporations & corporative societies

Infants & minor

In Kenya any one under the age of 18years a minors. Minors may make contracts but they are not bound by them, this means that even if the contract is legal and the minor is in breach he cannot be sued on it. This law is based on two rules.

1. The law protect the minor against his inexperience which may enable an adult to take unfair advantage of him or endure him into entering a contract eg inducing a minor to buy something he cannot afford.

2. The law not cause unnecessary hardship to adults who deal fairly with minor. Under this principal certain contracts with minor are valid other avoidable.

Binding contracts

These are contracts for the supply on necessaries these are item that are regarded necessary to the particular standard of the living of the minor. This includes food, basks clothing and other items depending on the minor modern status in life although the minor is liable for the necessaries sold and supplied to him the on us lies on the plaintiff to prove.

i. The minor actally needed the goods at the time of sell and delivery

ii. That he was adequately supplied with goods of that class

iii. That the price charged for the goods is reasonable.

Nash Vs Inman 2KB

The plaintiff supplied to the defendant a Cambridge graduate to the value of$145. The clothing included ii fancy waistcoats. The defendant argued that he was a minor when the goods were supplied and they were not necessaries. The defendancts father gave evidence that he was amply supplied with clothes. It was held that the onus of proving that they were suitable to the condition in life of the minor ant that the defendant was not already adequately supplied with such goods, was on the plaintiff the plaintiff had failed to establish this.

NB If a minor borrow money to buy necessary he must repay the placed in the position of the sell necessaries.

Beneficial contracts

The category includes

A minor is bound on an employment or aqures education services or any beneficial experience in the

He is bound to pay a reasonable price, where the price is agreed.

Doyle Vs White city stadium [1937]

The plaintiff a minor applied to the British boxing board for a licence as a boxer and agreed to be bound to the rules of the board a few months later the rules were changed and intend of a rule which stated that a boxers money was that in any case of disqualification the boxes was only to receive certain expenses. The plaintiff had agreed to box in return for $3000 (win, lose &draw) but he was disqualified for falling, the board held some of the $3000 and the boxes daimed for the whole sum it was held that the contract as a whole was beneficial for the plaintiff and therefore binding to him.

De. Francesco Vs Barnum [1890] A 14year old girl become apprenticed by dead to the daimant for seven years in order o be taught stage dancing. The deed provided that she was to be at the total disposal of the daimant, she would not get paid unless he employed her, which he was not bound to do nor was he bound to maintain her. He agreed to pay her nine pence per right and six pence per matinee for the first three years. After sthat the pay rose to one shilling per night six pence per matinee.

She could not accept any professional engagement without his daimant could also terminate her contract whenever he wished without notice. Not surprisingly, the court held the contract to be unduly harsh and therefore unenforceable.

Proform sport management Ltd Vs Proactive Sport Management Ltd[2006]

Daimant football agent entered into a representation agreement with Wayne rooney when he was 15 year old. In June 2002 the player and his parents wrote to C stating that they would not renew the agreement when it expired in December 2002 three days after the expiry of the agreement the player entered into a new representation agreement with the defendant interference with and or the procuring of breach of contract . I applied for summary judgement on the ground that as a matter of law there was no liability the breach of a voidable contract with a minor.

The issue was

1. Whether there can be liability for inducing the breach of a voidable contract with a minor and

2. Whether the contract in issue (a football agents representation agreement) fell within the doss of contract were enforceable against a minor.

The daimant had no real prospect of establishing that the agreement was a contract for necessaries. The player was entitled to avoid the contract and the defendant could not be liable for inducing breach.

Voidable contracts

These are contract that dind both parties but the minor can repudiate before he attains the age of ……………. Within a reasonable time there after the other party cannot repudiate example,

1. Contract concerning land, a lessee who is nder age is liable for rent unless he repudiates. A minor who agrees to purchase free hold he is bound unless he repudiater

The same principle applier where a minor lets or agrees to sell land.

2. Buyng stones in Companies a minor who agrees to subscribe for shares in a company which are not fully paid is liable for cause unless he repudiates. A mere plea is not ratified the transaction does not release him of liability. If he repudiates he ceases to be liable and cans have his name removed from the companies register. If a company is being wound up while the buyer is still a minor the liquidator can exercise the minor rifgt for repudiation for him.

Steinberg Vs Scala [1923] the plaintiff when a minor applied for shares in a Company and paid the amount due on allotment. She paid the amount due on the 1st call and did not receive any dividend and attended no company meeting 18months later while still a minor she repudiated the contract and requested the money she had paid the Company. It was held that she was a minor she was entitled to repudiate the contract. But as there was no failure o consideration she could not recover the money paid to the Company.

3. Partnership

A minor can become a partner and to some extent he is bound to the partnership agreement. He can’s be used as a minor by persons losses. But he is liable when he becomes of age he fail to put an end to the partnership. He is not entitled to the share of profit and asset until it’s liabilities have been discharged.

Void contracts

The following with minor are void

i. Any agreements for repayments of money to lend and to be lent.

Leshe vs Sheal [1914] sheil a minor by frequently representing himself as of age, induced Leslie to lend him $400, he refused to pay for it and leslie sued him. It was held that the contract was absolutely void and shell was not liable to repay the loan.

ii. Contract for goods supplied other than necessaries.

iii. Liability to tort (civil wrong)

The general rule is that minor are liable in test so as adults are, conduct amounting to breach of contract may also a tort. He can sometimes set the invalidity of the contract as a defense to the tort daimant.

Jennings Vs Rundall [1799]

In this case a minor hired a house and by over-riding injured it. It was held that he could not be liable in tort for what was really a breach of contract .

iv. Persons of unsound mind and drunkards

The law relating to contracts with patients representing a compromise between two principles.

i. Such a person should not be liable on his contract if he is incapable of intelligence concepts

ii. It might cause hardship to one contracting party to stultify ………..

A mental patient is liable for necessaries extreme drunkardness is a defence to a contract if it presents the defendant from understanding the transaction and if the diamante known this

The drunkard is liable if the ratifies the contract when he becomes sober.

All other contract apart from the ones for necessaries are voidable at the option of the mental patient or drunkard if at the time the contract was made the other party was aware of the condition of the mental patient or drunkard.

The mental patient or drunkard can repudiate the contract within a reasonable time of the ……………… of the disability otherwise it will be binding to them A contract made by a mental patient during ………. Interval will be binding on him.

Aliens / Non citizens

An aliens is under no disability and can sue and be sued. However an energy aliens cannot sue, but if sued can defend himself.

Corporations

Corporation fall into two broad type,

1. Chartered corporations, at common law, incorporation could take place only by royal charter chartered corporations have the power to do with their property all that a private individual can do and to enter all such contract as a private individual might enter. If such a corporation makes any contract which it is not authorized to make the contract is valid, though the charter may be revoked.

2. Statutory corporation the vast majority of corporations today are created by, or under the authority of statute. Some corporations are created by a special act of parliament though most commercial corporations are created under the provision of the companies act 1985. Copanies created under CA 1985 may be public or private, limited by shares or by guarantee.

The corporations can sue and be sued in their own names they are liable to actions in tort. A corporation is also liable for torts committed by its servants and agents. But is a servant of a corporation commits a tort which is ultra vires’ (beyond the power) then the corporations is not liable. Similarly, a corporation is not liable for some torts of personal nature eg personal defamation battery etc.

Trade Unions

The trade unions have capacity to sue in tort but actions against them in tort are limited $23 of the trade union as cap. 223 provider that no action shall be brought against a trade union for torts committed by its member of officials in respect of any act done in contemplation or in furtherance of a trade dispute.

For example if a trade union calls a stroke it cannot be sued by an employer for the tort of including a breach of contract.

A trade union can be sued for breach of contract. The members and official of a trade union can be sued for action in tort committed in their personal capacity.

Terms of a Contact

Terms of a contacts are its contents and this determine the extent to which the parties are deemed to the agreement. According the terms define the rights and obligations arising from the contract.

Contractual terms may be expressed or implies expressed terms are statements are made by parties and by which they intend to be bound.

Implied terms are implied by law either by provisions of a statute or to give effect to the presumed intention of the parties. Each term of a contract expressed or implied are either conditions or warranties.

A distinction between a condition and a warranty are stated 10 $139(2) of the sales of good act and it states whether a stipulations in a contract of sale is a condition in breach of which will give rise of a right to treat a contact as repudiated or a warranty the breach of which may give rise to a claim for damages but not the right to …………. The goods and treat the of the contract and a stipulation may be a conditions condition breach of which entitles the innocent party to avoid the contract and daim for damages.

Poussard Vs Spiers (1876)

An actress contracted to play in an opera in the beginning of its run. Owing to illness she was unable to perform for the first week of the opera. The producers had at the mean time, engaged a substitute and refused the service of the ac tress.

It was held that the lapse of time amounted to breach of condition which entitled the producers to repudiate the contract.

A warranty is a term of lesser importance and it doesn’t go to the root of the contract it’s breach entitles the innocent party to daim for damages but gives no right to terminate the contract.

Bettini Vs cycle [1876] Bettini was engaged for the whole of the season to sing at Gyes theatre and agreed to appear 6 days in advance for the purpose of rehearsals. Due to illness, B arrived 3 days in advance. G terminated B’s contract on this aground it was held that the rehear sale clause was co-lateral to the main purpose of the contract and its breach could give rise to damage and not repudiations of the contracts.

Parole Evidence Rule

It applies to contract that are written and prevents the parties from saying extrinsic evidence, to add or to vary the writing. In order to prevent this rule the parties will construct a contract to be party written oral. So that it will only …………. Where the writing is intended to contain the …..

The court may also hold that there are 2 contract, the written where the parole evidence rule applies and the oral collateral contract to which the rule doesn’t apply.

J Evans & sons (Portsmouth) Ltd Vs Andrea Marzano Ltd[1976]

The defendant ( carriers) shipped machinery for the plaintiff. This used standard conditions used by the trade union. In 1967, the defendants used trailers and agreed that the machinery would always be carried below deck. The defendant then switched to containers and assured that the plaintiff machinery will still be

stored below deck B there was change and the new standard conditions stated hat the plain goods should be stored on the deck. Later the plaintiff goods were washing off deck. The plaintiff sued for the breach of contract successfully.

The court held that the defendants could not rely on written contract only and allowed the plaintiff to adduce out evidence.

Exclusion clauses [Exception]

There are contractual stipulation intended to exclude the liability of one of the parties in a contract or in tort. Where a standard form of contract is used it is not unusual for the parties who drew it up to take advantage of their dominant position by introducing the clause.

In determining whether an exclusion clause is binding the following rules are followed e.g existence of the clause must be communicated to the other party.

The circumstances must show an intention to be bound.

The clause will be constructed most strongly against the party seeking to take advantage of act.

Parkes Vs south Eastern Railway [1877] in this case the plaintiff deposited his bag in the defendants darkroom and paid 2d’s and received a ticket. On ticket, the words “seek back” were printed and on the back a notice stated that the company will not responsible for the luggage worth more than 10 pounds. A notice containing the same condition was displayed in the darkroom. The plaintiff bag was lost and claimed his value which was more than 10pound. He argued that he had taken the ticket without reading it and thought that it was only a receipt for evidence that the company had his bag it was held that the trials judge had misdirected the jury since he had not asked them whether the defendant had taken reasonable steps to give the plaintiff the notice of the condition.

Chapelton Vs Barry Urban district [1940]

Deck chairs were stacked by a notice asking the public which wished to use the deck chairs to get tickets and retain them for inspection. The plaintiff paid for a tickets for chairs, but did not read the back of them where the printed words purpoted to exempt the council from liability. The plaintiff was …………………………………………………….. object was that the hirer might produce is to prove that he paid and to show him how long he might use the chair.

Thompson Vs London, Midland &Scottish [1930]

The plaintiff who could not read gave her niece the money to buy an exclusion ticket. On the face of he ticket was written, Excursion, for conditions, see back. And on the back issued subject to the condition and regulations in the camping’s time table and notice and excursion and other bills.” The condition provided that excursion ticket holder show have no right of action against the company in respect of any injury however caused. The plaintiff stepped out of a train before it reached the platform and was injured.

It was held by the court of appeal which was supporting the court that the defendant had no wrong and land hanworth Mr. said threat anyone who took the ticket was conscious that there were some condition and it was obvious that the provided for the usual fare. Having regarded to the condition of education in the country it was irrelevant that the plaintiff could not read.

Olley Vs Nalborough court Ltd [1971]

The plaintiff booked in for a week’s stay at the defendants hotel. A stranger gained access to her room and stole her mink coat. There was a notice on the back of the bedroom door which stated that. The properties will not hold themselves responsible for cuticles lost or stole unless handed to the manageress for safe custody.

The court of appeal held that notice wasn’t incorporated into contract between the proprietors and the guest. The contract was made in the hall of the hotel before the plaintiff entered her bedroom and before she had an opportunity to see the notice.

Thernton Vs shoe Lane Parking Ltd [1971]

The plaintiff went to park his car in the defendant’s automatic car park. A notice at the entrance to the car park gave a notice that all car were parked at owner at owners risk. When a car was driven the machine dispensed a ticket, the plaintiff took the ticket which stated on small print that it was issued subject to conductions subject on the underlie (among other things) that the defendant would not be liable for an injuries to customers which accrued when the cars were in the premises. The plaintiff was injured in the car park, the defendants relied on the exemption on the ticket.

It was that the ticket came too late since the contract was conclude when the motorist drove to the machine.

The ticket exemption was the only one wide enough exempt from liability for personal injury but it couldn’t be relied upon.

Effect of signatures

When a person puts his signature on a contractual document, he is bound any exempting clauses held in it.

He can’t rely

L’estrange Vs Graucop Ltd [1934]

The plaintiff bought an automatic cigarette vending machine from the defendant. She signed an order form which contained the following term in small print any expressed or implied condition statement or warranty, statutory or otherwise not stated herein is hereby excluded” The D gave here a printed confirmation of this order but when she was given the machine it didn’t work satisfactory. The P sort damager for breaches and the D relied on the exemption ……………………………………………. It was held that the P had signed the written contract and was not induced by any misrepresentation, she was bound by its terms it was wholly immatenal that she had not read the contract of the document she signed.

Curtis Vs chemical cleaning & Dyeing Co. [1951]

The P took her white …………….. wedding dress to the defendant to be cleaned. The shop assist asked her to sign a receipt, which infact contained a condition excluding the D liability for any damage however arising. When the P asked why she had to sign the assistant told her that the D would not accept liability to the damage of the beads and sequin with which the dress was twinned, the P sighed when the dress was returned it was stained the D argued that the clause excluded their liability. It was held that the D could not rely on the exemption clause because of the assistant’s innocent misrepresentation which had mislead the P as to the extent of the exemption and there by induced her to sign the receipt.

Privity of Contract

The doctrine of probity of contract provider that only the parties of a contract can enjoy the contract and burdens of the contract.

Consideration should more from the promise i.e A person can’t sue on a contract if consideration was provided by another even where the contract was made for her benefit.

Tweddle Vs Alkonson

Jurtua Crompton said that “ consideration must more from the party entitled to sue upon the contract it will be a monstrous proportion to say that someone was a party to the contract for purpose of suing upon it for his advantage and not a party to it for the purpose of being sued”

The doctrine of privities applies to present two persons from encoring a contract

1. Complete stranger

2. 3rd parties to beneficiary who has been identified and intended by the parties to benefit from the contract.

Dunlop preumatic Tyress Vs Selfridge & co Ltd [1915]

In this case Dew & Company agreed with the P to buy the P’S tyrer in consideration for obtaining discount on the least tyrer for trade buyer on the least price unless a similar undertaking was given by the trade buyer that they would observe P’s least price D ordered Dunlop tyrer from Dew and company and agreed with Dew in return for receiving a discount that they wouldn’t sell of offer these tyres to any private customers at less than the least price. However D did sell the tyres at below least price and P sued them for breach of their undertaking. It was held that there was no consideration moving from the plaintiff to the defendant and therefore the contract was not enforceable by the plaintiff.