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LAW TRIPOS Part IB EXAMINATION IN LAW FOR EUROPEAN STUDENTS

Monday 23 May 2016

1.30 to 4.30

Paper 10 LAW OF CONTRACT Answer four questions. Answer all parts of a divided question unless instructed otherwise. You may use your own copy of Blackstone’s Statutes on Contract, Tort and Restitution 2015-2016 (but not earlier editions), and any monolingual or bilingual dictionary (except electronic dictionaries and specialised legal dictionaries).

STATIONERY REQUIREMENTS 20 Page Answer Book x 1 Rough Work Book x 1 Tags

There will be 10 minutes’ reading time before the start of this examination. You are not permitted to write, whether in the answer book, on rough paper, or otherwise, during this period. You may not start to read the questions printed on the subsequent pages of this question paper until instructed that you may do so by the Invigilator.

2 1 Cancer Charity organises an ‘Auction of promises’ to fund its new hospice. Payments are to be made by a successful bidder to the Charity immediately at the end of the auction. Mariya, a celebrity chef, agrees with the Charity to provide it with a cake for auction. Nyana successfully bids £100 in the auction for the cake. Nyana seeks your advice on all the following alternative scenarios: (i) Mariya refuses to hand over the cake because Nyana has not yet paid £100 to the Charity. (ii) Nyana has paid, but Mariya now refuses to deliver the cake, because Mariya says that Nyana is trying to profiteer by re-selling the cake on e-bay for £300. (iii) Mariya describes the cake as ‘nut free’ and Cancer Charity incorporates this in the catalogue of items for auction. The catalogue contains the clause: ‘The Charity accepts no responsibility for any errors in the description of the items or services sold in this auction.’ Owing to an error by one of Mariya’s kitchen staff, the cake contains nuts. Nyana is allergic to nuts and falls ill. (iv) In the same auction, Piya, a registered childminder, offers one night’s babysitting on Thursday 7 April. Nyana is successful in bidding £50 for this service. She then buys expensive tickets at the opera for that evening. Piya does not come to babysit on that evening and Nyana and her wife are not able to leave their baby and go to the opera. 2 Myfanwy is an expert on rare manuscripts. She discusses with Nerys, the curator of manuscripts at Betws Library, which of its manuscripts the Library has for sale. The conversation is conducted in Welsh, but the subsequent contract under which Myfanwy agrees to buy manuscripts from the Library is written by a secretary in English. The Library has three manuscripts of the Laws of Hywel Dda: Red, White and Green. Myfanwy agrees to buy two of them, the ‘Red’ and the ‘Green’. Advise Myfanwy on all the following circumstances: (i) The ‘Red’ manuscript is considered by authoritative writers to be 14th century. When Myfanwy had purchased it, and had it carbon dated, she discovered that it is a 17th century copy. When asked about its authenticity, Nerys had said prior to the contract ‘we believe it to be from the 14th century, but you can never be sure’. Would it make any difference if the Library had also undertaken carbon dating before the signature of the contract, but had not disclosed the results to Myfanwy? (ii) The ‘Green’ manuscript is a 16th century copy and the ‘White’ manuscript is an 18th century copy. Whereas the conversation between Myfanwy and Nerys had been about the Green manuscript, the secretary made a mistake in drafting the written contract and made the contract ‘for the purchase of the “White” manuscript’. 3 Allie is a young and inexperienced graduate. Her neighbour, Betty, is an experienced professional. Allie frequently asks Betty’s advice on financial transactions and follows Betty’s advice without consulting others. Allie has just got a job far away from her current home in a small town where it is difficult to rent property. Betty tells Allie that Betty’s daughter, Chloe, is willing to offer a three-year lease of a nice flat in that town. The amount of the rent is double the local market rate. Allie signs the contract with Chloe. The contract contains a clause stating that ‘the landlord will provide the tenant with keys to the property’. Allie is given one swipecard key. A week after the signature of the contract, Allie asks Chloe for a second key to the flat. She is told that a further swipecard key will cost £500, because Chloe will have to commission the key specially. Allie needs the spare key to permit her cleaner to enter while she is at work, and so she agrees to pay reluctantly. Advise Allie.

3 4 Sonya and Tanya are qualified care assistants. Apart from their main jobs in local care homes, they offer care visits to individuals in their own homes under the brand ‘Helping Hands’. The contracts which they and the individuals sign, contain clauses to the following effect: (i) the services provided are described as ‘personal and household help, but not washing dishes or clothes, for a period of time not exceeding 30 minutes per visit’; (ii) the cost of the visit is £60 (an amount which is double the normal market rate) and time over 30 minutes will be charged at £30 for each period of up to 10 minutes; (iii) failure to pay in full within 7 days from the receipt of an invoice will incur a 10% per day surcharge. Dora is an individual who has signed such an agreement with Sonya and Tanya. In the last month, they have refused to help her load the washing machine, causing her to pay the local laundrette to do her clothes washing. Dora’s personal needs have been such as to necessitate the carers spending an extra 15 minutes on each of their thrice daily visits over the first week of the month, and, basing themselves on clause (ii), Sonya and Tanya have charged Dora an additional £60 for each visit during the whole of that first week. She refuses to pay the invoice which she considers excessive, but Tanya warns her that failure to pay will incur the surcharge. Advise Dora. 5 ‘[T]he court should not fill a perceived gap in the contract unless, without doing so, the contract will not work…The starting point should be an assumption that no term will be implied if the express terms of the contract produce a result which is workable.’ (LORD GRABINER QC) Discuss. 6

The UNIDROIT Principles provide: ‘7.4.2 (1) The aggrieved party is entitled to full compensation for harm sustained as a result of … non-performance. Such harm includes both any loss which it suffered and any gain of which it was deprived, taking into account any gain to the aggrieved party resulting from its avoidance of cost or harm. (2) Such harm may be non-pecuniary and includes, for instance, physical suffering or emotional distress.’ How far does this represent current English law? 7 ‘[Frustration] is really a device by which the rules as to absolute contracts are reconciled with a special exception which justice demands.’ (LORD SUMNER) Discuss. 8 ‘[I]n England, there are relatively few restrictions on the right of termination [for breach]. Where the defaulting promisor is in repudiatory breach, the injured promisee enjoys a broad ability to terminate. This facilitates his expeditious release from the contract, enabling him to put his resources to better, potentially mitigatory, use elsewhere. It reflects a wider policy in English law…that contracting parties should not be tied together when their contract has failed.’ (ROWAN) Discuss.

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