100 Cases Contract LAW PDF

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100 CASES CONTRACT LAWOffer and AcceptanceCASE NAME TOPIC/FACTS HELD/ PRINCIPLEBarry v Davis(a.k Barry v Heathcote Ball & Co (Commercial Auctions, CA, 2000)Auction SalesTo hold an auction ‘without reserve’ would amount to an offer to sell to the highest bidder, accepted by the submission of ...

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100 CASES CONTRACT LAW

Offer and Acceptance CASE NAME Barry v Davis

TOPIC/FACTS Auction Sales

(a.k.a Barry v Heathcote Ball & Co (Commercial Auctions, CA, 2000)

To hold an auction ‘without reserve’ would amount to an offer to sell to the highest bidder, accepted by the submission of the highest bid

Butler Machine v Ex-Cell-O Corporation

D intended to sell a machine to P and sent its standard form contract to P. In D’s form, there was a clause providing D’s form would prevail any other inconsistent terms in the buyer’s terms. P replied “please supply on terms and conditions as below and overleaf. There was a tear-off slip on the footing of P’s order D filled in the slip and sent it to P.

HELD/ PRINCIPLE In a sale without reserve there was a collateral contract between the auctioneer and the highest bidder There was consideration both in the form of detriment to the bidder since his bid could be accepted and benefit to the auctioneer as the bidding was driven up In such a sale if the auctioneer refuses to sell to the highest bidder they will be in breach of contract Doctrine of last shot The parties will agree on the terms which were sent last In Butler the buyer sent the last terms or ‘shot’ it is held by the court the contract was concluded on the buyer’s terms Any inconsistency on the buyer’s terms will be invalid Lawton LJ and Bridge LJ’s traditional approach

On whose terms? there are the sellers terms and the buyers terms and this is the dispute in the case it established a very old English rule in contract law: Doctrine of last shot Carlill v Carbolic Smoke Ball

Reward Offer The D advertised that they would pay 100 to anyone who contracted flu after

Held: this argument was rejected by the court which found that the advertisement constituted an offer to the world at large, accepted by C who was entitled to 100

using their product for a specified period of time As proof of sincerity, the D stated they had deposited 100 in a bank the C contracted flu after purchasing and using one as directed and claimed the reward The D argued, inter alia, that it was impossible to contract with the whole world Dickinson v Dodds

Revocation of an Offer

An offeree who knows that an offer has been withdrawn cannot accept it even if the On June 10th 1874, Dodds made a written communication has not come directly from the offer to Dickinson to sell certain premises offeree for 800 and stating that this offer would remain open until 9 am June 12th Held: On June 11th Dodds sold his property to a third person without notice to Dickinson

CA, No contract had been formed, promise to keep an offer open could not be binding

Dickinson has in fact been informed of the sale though not by anyone acting under the authority of Dodds

Communication of revocation need not be made in person; it may be sufficient if revocation is communicated by a reliable third party

Before 9am on the 12th he purported to accept Dodds offer

Errington v Errington

He then brought an action for specific performance Revocation of an Offer (Unilateral Contract) A father financed the purchase of a house by mortgage and allowed his daughter and son-in-law to live in it, on terms that f they paid off all the mortgage repayments, the house would be theirs. The couple made no counter-promise so the contract was unilateral

Held: Once the couple commenced and continued making the repayments the offer could not be revoked However, the father would not be liable on his promise until performance of the stipulated act was complete (i.e. when all the repayments were made) Lord Denning: when you made a promise relied upon by another party to their determent you cannot change your mind (Promissory Estopple)

Felthouse v Bindley Acceptance must be Communicated / Silence as acceptance The claimant wrote to his nephew offering to buy a horse and saying ‘If I hear no more about him, I consider the horse mine at (a states price)”. The nephew did not reply but instructed the auctioneer to keep the horse out of the sale of the nephew’s assets

Henthorn v Fraser & Adams v Lindsel

The auctioneer, by mistake, included the horse in the sale and was sued by the claimant for conversion Postal Rule and Acceptance by Post Adams v Lindsel The parties in the UK (offeror) sends the letter of offer to the offeree who accepted the offer via mail but the letter got lost!

Held: The claimant has not title to sue since the nephew had not accepted his offer Clear that the nephew intended to accept the offer, arguable by his conduct in instructing the auctioneer not to include the horse in the auction (consistent with the intention to accept) However, a contract cannot be imposed on a offeree as it undermines the fundamental principle of ‘freedom of contract’

Henthron and Fraser The importance of this decision's ratio is that a postal acceptance will only be valid at the time of posting if it is reasonable for the offeror to expect an acceptance by post.

The offeror had never received the acceptance The acceptance is made when the letter is posted by the offeree when the acceptance is made by a letter the acceptance takes legal effect as soon as the offeree puts the letter in the mail box

Luxor v Cooper maybe need more?

Unilateral Contract (Agency Case) The court refused to hold that the claimant was entitled to commissions on introducing the buyers of the cinema when the defendant refused to sell

Held: In this case the court ruled the agent was not entitled to the payment Legal reasoning is different because we have a special body of agency contract law which depends upon the completion of the deal in order to get commission

Partridge v Crittenden

Offer & Advertisements The appellant, who placed an ad in a periodical which said ‘Bramble finches, 25 shillings each’ was charged with the statutory offence of offering for sale a wild bird .

Held: His conviction would be quashed because the as was not an offer but an ‘invitation to treat’ Comment: it must be stressed that advertisements may be construed as offers if they are of the unilateral type, such as offers of rewards (Carlill & Carbolic)

He was convicted and appealed Pharmaceutical Society v Boots

Pickfords v Celestica

Held: Display as ‘invitation to treat’. Offer when customer Facts: The D owned a self-service store takes them to the cash desk. acceptance by shop at where non-prescription drugs were the cash desk  the display contains key terms such as price displayed on the shelves. The customers  But the display does not convey an intention could pick up the drug which they wanted to be bound on those terms  intention is missing therefore the display of goods cannot be an offer Invitation to Treat OR Offer?

Termination & Counter offer case not mentioned in any notes/text

R. v Clarke

Acceptance must be given in exchange for the Offer

Under the law of contract, shops are not bound to sell goods at the price indicated; and a customer cannot demand to buy a particular item on display Held: Where two offers were made in series prior to a purported offer, the second offer was capable of revoking the former if it were materially inconsistent. In the instant case the offeree had purported to accept the revoked offer with an additional term. The acceptance was a counter-offer which could be accepted by the offeror's conduct. Where two offers were made in series prior to a purported offer, the second offer was capable of revoking the former if it were materially inconsistent. In the instant case the offeree had purported to accept the revoked offer with an additional term. The acceptance was a counter-offer which could be accepted by the offeror's conduct. Held: *Principle in F v S

In American case Fitch v Snedarker it was ruled that a person who gives information without knowledge of the offer of a reward cannot claim the reward Australian case R. v Clarke the principle was extended to the case of a person who had once known of the offer but at the time of performance/ acceptance it had ‘passed from his mind’

CASE NAME Chappell v Nestlé

Collins v Godefroy

CONSIDERATION TOPIC/FACTS HELD/PRINCIPLE Consideration Need not be Adequate Held o HOL held that used chocolate wrappers were part of the consideration for the purchase of gramophones o Trivial but sufficient consideration Existing public Duty

Held:

An existing duty is the duty which the party has already owned under the law or another contract

Cited as the authority for the proposition that the performance of an existing public duty is not consideration

Facts D promised to pay the C a sum of money for giving evidence in a court action in which the C has been subpoenaed As the claimant was under a legal duty to attend court it was held that he has no furnished consideration Combe v Combe

Promissory Estopple not a cause for action Consideration must be the act (or omission) or promise requested by the promisor in return of his promise

Held: CA held: that there was no consideration for the promise as the wife’s forbearance has not been requested and was not in return for the promise made to her; nor could the wife rely on promissory estopple

Facts: A husband upon divorce promised his wife 100 a year as a permanent allowance

Her action failed. There was no pre-existing agreement which was later modified by a promise. The wife sought to use promissory estoppel as sword and not a shield.

In reliance upon this promise the wife forbore to apply to the courts for maintenance The Husband failed to make the payments and the wide sued him on the promise Glasbrook v Glamorgan

Existing public Duty

Principle:

Facts

Consideration will be given when an existing public duty is exceeded

If the police agree to provide colliery with extra protection during a miners strike they provide consideration for a promise to pay them for the extra service Lampleigh v Braithwait

Past Consideration Previous request of the promisor

Roscorla v Thomas

Past Consideration  Executed consideration

Held: If the performance is at the D’s request and in circumstances where both parties understand that The defendant had killed a man and was payment will follow, the court may be prepared to due to be hung for murder. He asked the enforce the transaction claimant to do everything in his power to obtain a pardon from the King. The Whilst the promise to make payment came after the claimant went to great efforts and performance and was thus past consideration, the managed to get the pardon requested. consideration was proceeded by a request from the The defendant then promised to pay defendant which meant the consideration was valid. him £100 for his efforts but never paid The defendant was obliged to pay the claimant £100. up.

Facts The C purchased a horse from the D who afterwards in consideration of previous sale warranted that the horse was sound and free from vice

Held: The sale itself created no implied warranty that the horse was not vicious The warranty had therefore to be regarded as independent of the sale and as an express promise based upon a previous transaction

In was in fact a vicious horse

Pao On v Lao Yiu Long

Exceptions for Past Consideration Facts P sold their private company to D, who were the shareholders of a public company called FC.

Plaintiff is the seller, the D is the Buyer D transferred some of their shares in FC as the contract price. in addition to paying some money in cash the D promises to pay some of his company’s shares as a form of payment If the P after receiving those shares decided to sell those shares in the stock market what would happen? (significant shares) the market price for that share will fall  this is the risk that the D worries about P promised not to sell their FC shares, but P wanted a guarantee against the risk of a fall in the FC share price. So, D promised to buy Ps’ FC shares back at $2.50 at the end of the year. P realised that this was a bad deal because that if the price for FC shares has been higher than $2.50, D would have made a profit. So, D promised that P would indemnify

It fell, therefore, within the general rule that a consideration past and executed will support no other promise than such as would be implied by the law *there are exceptions Principle Past Consideration may also be the existing duty  the promise which the P made that he would keep the share for a year happened before the D made the new promise  this is an existing duty because that promise was made in the previous contract, he was already obliged to fulfil this duty The Privy Council identified 4 factors to consider in assessing whether economic duress was present: 1. Did the person claiming to be coerced protest? 2. Did that person have any other available course of action? 3. Were they independently advised? 4. After entering into the contract, did they take steps to avoid it?

(insure) Ps’ losses if the price of FC share would fall below $2.50. The question was if Ps provided any consideration for Ds’ second promise. Scotson v Pegg

Existing Contractual Duty owed to a Third party Facts: o A agreed to deliver coal to B or to B’s order o B ordered A to deliver the coal to C o C promised A that is A would deliver the coal he would unload it

Held: In an action by A to enforce C’s promise it was held that A delivery of coal (the performance of an existing contractual duty to a third party, B) was good consideration to enforce C’s promise

Tweddle v Atkinson Consideration must move from the Principle promisee need to expand on Privity of contract’ & (Rights of Third possibly Facts 1999) o X agreed with Y that they o a third party can bring himself would each pay a sum to terms of a legislation may X’s son Z enforceable action in cases such o Z was Y’s prospective sonabove in-law o Z’s action against Y’s executors failed as no consideration had moved from Z Wade v Simeon

Forbearance to Sue

parties Act within the well have as the one

Principle: If a claim is not only invalid, but is known by the party forbearing to be so, there is no consideration

Foaks v Beer

Problems with the Doctrine of Consideration

Principle

Facts •

The legal rule: part payment of a debt cannot clear the whole amount

a lender and a borrower, the borrower failed to pay the money back which he borrowed

As per Pinnel’s Case [1602], part payment of a debt

•

• • • •

•

•

the lender said if you pay half of what you owe I will not ask you for the full the borrower paid half the original debt after receiving half the money the lender sued for the rest the case was decided in favour of the lender the reason was, when the lender made a new promise for not suing, what was the consideration that the borrower gave to the lender? paying half of the debt was not good consideration because there was already an existing duty on the part of the borrower and had no new benefit to the promisor, the borrower/ promisee did not have a determent the lender did make a promise

is not satisfaction of the whole. As such, interest was owed as there had been only part payment

IMPLIED TERMS CASE NAME

Andrews v Hopkinson 

NOT REALLY PRESENT IN TEXT/ Lecture

TOPIC/FACTS Breach of Warranty

HELD/PRINCIPLE 1 Held:

In Andrews v Hopkinson (1957), P wanted to obtain a second hand car.

P could recover damages from D for breach of undertaking given by him before the hire purchase contract was made.

D a car dealer showed him one and said, "it's a good little bus. I would stake my life on it".

Here, D had given an undertaking to P which had induced P to make the hire purchase agreement. The Court was able to construe a "collateral contract", the consideration for which was the making an independent contract with another person, the finance company

P agreed to take it on hire purchase terms. P paid £50 deposit to D.

D then sold the car to F, a finance company, who entered into a hire purchase contract with P. P had not so far examined the car. A week later, the car was involved in an accident as a result of which the car was wrecked and P was seriously injured. It was found the steering mechanism of the car was badly at fault. P sued D for the damage he suffered.

Bannerman v White

Deciding if a statement is a ‘representation’ or representation

Held: 

Importance principle Facts: Farmer’s assurance that hops had not been treated with sulphur.

British Crane Hire v Ipswich Plant Hire



this statement was found to be a term because had that statement not been made that buyer would not have bought the hops statement = description of the goods being sold

Facts

Held:

Both parties were in the business of hiring out plant machinery. The defendants, Ipswich Plant Hire (IPH), were doing some work on some marsh land and needed a dragline crane urgently so contacted the claimant, British Crane Hire (BCH), to hire one. The hire of the crane was dependent upon having the claimant's driver. Unfortunately the crane sank in the marsh land so much that it was out of sight. It was accepted that this was not that fault of either of the parties. However, it cost a great deal of money to get it out. The contract between the parties was concluded over the phone. A copy of the terms and conditions of hire were handed to the defendant on delivery of the crane, although the

The term relating to risk was not incorporated into the contract as the defendant was unaware of it at the time the contract was made, however, the court implied the term into the contract as both parties were in the business of plant hire and it was known to both that the use of such terms was prevalent in the trade. AND Where a clause is an unusual one in the trade and the parties are of equal bargaining power in the same trade, less will be required in terms of the regularity of the previous course of dealing for it to be included in the contract

Chapelton v Barry

defendant had not yet read or signed it. The contract specified that the risk of hire remained with the hirer. Express Terms – incorporation by notice – Time of notice • Notice must be given before or at the time of contracting. •

If clause brought to attention after contract is made, then not incorporated.

Facts: The claimant hired a deck chair from Barry UDC for use on the beach. There was a notice on the beach next to the deck chairs stating that the deck chairs could be hired at 2d for three hours and also 'respectfully requested' the public to obtain tickets issued by the chair attendants. The claimant obtained a ticket and put it in his pocket without reading it. In fact there was an exclusion clause printed on the ticket excluding the council's liability for personal injury caused in using the deck chair. The claimant was injured when he sat on the chair. The fabric of the deck chair split away from the frame. He brought an action against the council and they sought to rely on the exclusion clause contained in the ticket. Deciding if a statement is a ‘representation’ or representation 

Esso v Mardon

Special knowledge/expertise: If the maker of the statement has some specia...