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• Explain what a contract is
• List the essential elements of a binding contract.
• Demonstrate understanding of the limitations of freedom to contract.
Key topics / learning outcomesof this Seminar
4
Quiz
1. What is a contract?
A: a legally enforceable agreement.
2. What are the essential elements of a contract?
A: offer, acceptance (i.e. together = agreement) plus consideration and intention to create legal relations.
5
Quiz
3. What does privity of contract mean?
A: only the parties to the contract are bound.
4. Does a contract have to be in writing?
A: No – in principle an oral contract is just as binding as a written one.
6
Quiz
5. Why then do we advise people to “get it in writing”?
A: for evidential purposes.
6. What are the two main remedies for breach of contract?
A: damages or specific performance.
7
Quiz
7. How are damages calculated?
A: They are designed to put C back in the position s/he would have been in, had the contract been performed.
8. Which of the two remedies is more common?
A: damages
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Quiz
9. Why is specific performance not awarded more often?
A: because it may be impossible and is frequently impractical.
10. If one party breaches a contract and the other wants to take legal action against them, in which court will the claim be heard?
A: County Court unless it is a high value or complex case (normally £100,000), in which case the High Court
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D was a civil servant working in Ceylon. C was his wife. She was unwell and living in England. D agreed to pay her a monthly allowance of £30. They agreed to separate, whereupon he stopped making the payments. She sued.
Is this a contract?
No
Balfour v Balfour [1919] 2 KB 571 (CA)
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C and D were married, but separated. D agreed to pay C £40 per month towards the mortgage and C paid the balance. They made a written agreement that D would transfer the house to C when the mortgage was paid. However, D refused to transfer the house. C sued.
Is this a contract?
Yes
Merritt v Merritt [1970] EWCA Civ 6 (CA)
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C and D formed an agreement for the sale of tissues. The written agreement included a clause stating that it was not a legal agreement. When D failed to continue the agreement, C sued.
Is this a contract?
No
Rose and Frank Co v JR Crompton & Brothers Ltd [1924] UKHL 2 (HL)
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D was promised by his father X that D need not repay X money he owed if he did not dispute X’s will. After X’s death, C, the executor, sued D for the money owed.
Is this a contract?
No
White v Bluett [1853} 23 Lj Ex 35 [Exch]
Wilson v Burnett
1. Summarise the facts.2. Who won?3. What did the first instance judge
decide?4. What did the CA decide?5. Go through the legal test for a
contract – where did they fall down?
Freedom to contract
1. Why not?2. Any particular circumstances or
parties where freedom to contract should be limited?
3. Examples
Summary
• Four elements for a contract• Up to parties to agree their terms• But there are limitations to what
the law will enforce