LAW1112 - Contract LAW - Summary of Topics PDF

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1 Contract 2 – LAW 1112

Table&of&Contents Table&of&Contents&& Remedies'...................................................................................................................................'6! Legal!Remedies!........................................................................................................................................!6! Equitable!Remedies!.................................................................................................................................!6!

DISCHARGE'BY'PERFORMANCE'..........................................................................................'6! To'Discharge'By'Performance'–'..................................................................................................'7! 1.! ENITRE!PERFORMANCE!RULE!................................................................................................!7! 2.! EXCEPTIONS!TO!THE!ENTIRE!PERFORMANCE!RULE!..............................................................!7! a.! SUBSTANTIAL!PERFORMANCE!........................................................................................................!7! b.! SEVERABLE!or!DIVISIBLE!CONTRACTS!.............................................................................................!8! c.! VOLUNTARY!ACCEPTANCE!OF!PARTIAL!PERFORMANCE!................................................................!8! ii.! Free!acceptance!.............................................................................................................................!8! d.! DE!MINIMUS!NON!CURAT!LEX!RULE!..............................................................................................!9! e.! TIME!FOR!THE!PERFORMANCE!OF!OBLIGATIONS!..........................................................................!9! THE!ORDER!OF!PERFORMANCE!OF!CONTRACTUAL!OBLIGATIONS!–!...........................................!10! CO-OPERATION,!GOOD!FAITH!AND!PERFORMANCE!–!................................................................11 ! ! PREVENTION!OF!PERFORMANCE!–!..............................................................................................!11! Discharge'By'Agreement'.................................................................................................'12! Discharge'By'Abandonment'–'...................................................................................................'12! Discharge'Pursuant'to'a'Term'of'the'Original'Contract'–' ..........................................................'13! CONTRACTUAL!RIGHT!TO!TERMINATE!UNDER!BREACH!..............................................................!13! CONDITIONS!PRECEDENT!–!.........................................................................................................14 ! ! 1.! Condition!precedent!to!FORMATION!...........................................................................................!14! 2.! Condition!precedent!to!PERFORMANCE!......................................................................................!14! •! A!condition!to!formation!or!a!condition!to!performance?!...........................................................!14! o! Subject!to!finance!.........................................................................................................................!16! Conditions!Subsequent!–!.............................................................................................................!17! DISCHARGE!BY!SUBSEQUENT!AGREEMENT!–!..............................................................................!17! Discharge!of!Executory!Contracts!–!.......................................................................................................!18! Discharge!of!Executed!Contracts!–!........................................................................................................!18! •! Consideration!...............................................................................................................................!20! Consequences!of!an!Accord!and!Satisfaction!–!.....................................................................................!21! Consequences!of!an!Accord!and!Conditional!Satisfaction!–!..................................................................!22! Waiver!–!.......................................................................................................................................!22! Frustration'–'....................................................................................................................'24! Frustrating!Events!–!.....................................................................................................................!25! Non-Frustrating!Events!–!.............................................................................................................!29! Effect!of!Frustration!–!..................................................................................................................!30! Discharge'of'Contract'by'Breach'–'...................................................................................'32! Failure'to'Perform'Contractual'Obligations'(term'of'contract)'..................................................'32! Conditions,!Warranties!and!Intermediate!Terms!–!.....................................................................!33! Conditions!–!...........................................................................................................................................!33! Warranties!–!..........................................................................................................................................!34! Intermediate!Terms!–!............................................................................................................................!35! Termination!for!Breach!of!a!Time!Stipulation!–!.....................................................................................!36! Contractual!Right!to!Terminate!–!...........................................................................................................!37! Repudiation!–!..............................................................................................................................38 ! !

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Anticipatory!breach!......................................................................................................................!39!

Termination!and!Its!Effects!–!.......................................................................................................!41! Restrictions!on!the!Right!to!Terminate!–!.....................................................................................!42! Party!not!ready,!willing!and!able!or!in!breach!–!....................................................................................42 ! ! Election!–!...............................................................................................................................................!43! Termination!Not!In!Good!Faith!–!...........................................................................................................44 ! ! Relief!Against!Forfeiture!–!.....................................................................................................................!45!

Misrepresentation'and'Misleading'and'Deceptive'Conduct'–'..........................................'45! Elements'of'Misrepresentation'–'..............................................................................................'46! 1!–!The!Representation!must!be!a!statement!of!FACT!–!.............................................................!46! 2!–!The!Representation!Must!Be!False!–!.....................................................................................48 ! ! 3!–!The!Representation!must!have!been!Intended!to!Induce!and!did!Induce!the!Innocent!Party! to!enter!into!the!Contract!–!.........................................................................................................!50! The!Issue!of!Materiality!–!............................................................................................................!52! Exclusion!Clauses!and!Misrepresentation!–!................................................................................52 ! !

Misleading'or'Deceptive'Conduct'–'.................................................................................'52! The'Meaning'of'‘In'Trade'And'Commerce’'–'.............................................................................'53! The'Meaning'of'‘Engage'In'Conduct’-'.......................................................................................'54! •! Silence!.................................................................................................................................!54! The'Meaning'of'‘Misleading'Or'Deceptive’'...............................................................................'56! When!conduct!is!misleading!or!deceptive!–!..........................................................................................!57! Conduct!directed!at!specific!individuals!–!..............................................................................................!57! Conduct!directed!at!the!public!generally!–!............................................................................................!57! Objective!Test!–!...........................................................................................................................!58! Intention!–!...................................................................................................................................!58! Causation!–!..................................................................................................................................!58! Opinion!Statements!–!..................................................................................................................!58! Misleading!representation!as!to!future!matters!–!......................................................................59 ! ! Exclusion'Clauses'and'Disclaimers'–'.........................................................................................'60! Remedies'–'..............................................................................................................................'60! Damages!–!...................................................................................................................................!60! Ancillary!Orders!–!........................................................................................................................!61! Mistake'–'........................................................................................................................'61! The!Concept!of!Rescission!–!...................................................................................................................!62! Common'Mistake'–'..................................................................................................................'63! •! FIRST!Common!Mistake!that!renders!a!contract!void!..................................................................!63! •! SECOND!Common!Mistake!that!renders!a!contract!void!.............................................................!63! •! THIRD!Common!Mistake!that!renders!a!contract!void!.................................................................!65! 1.! Couturier!v!Hastie!.........................................................................................................................!65! 2.! McRae!v!Commonwealth!Disposal!Commission!...........................................................................!66! 3.! Associated!Japanese!Bank!(International!Ltd.)!.............................................................................!66! 4.! Bell!v!Lever!Bros!...........................................................................................................................!66! Mutual'Mistake'–'.....................................................................................................................'67! Unilateral'Mistake'–'.................................................................................................................'68! Unilateral!mistake!as!to!Identity!–!...............................................................................................!68! Unilateral!Mistake!as!to!the!Terms!of!the!Contract!–!.................................................................!71! Non'Est'Factum'–'Mistake'as'to'the'Nature'of'the'Document'–'................................................'72! Duress'and'Undue'Influence'–'.........................................................................................'73! Duress'of'the'Person'–' .............................................................................................................'75! Duress'of'Goods'–'....................................................................................................................'76! Economic'Duress'–'...................................................................................................................'76! 2

3 Remedies'–'..............................................................................................................................'77!

Undue'Influence'–'...........................................................................................................'77! The'Nature'of'Undue'Influence'–'..............................................................................................'78! Categories'of'Undue'Influence'–'...............................................................................................'79! Actual'Undue'Influence'–'.........................................................................................................'79! Presumed'Undue'Influence'–'....................................................................................................'80! CLASS!2A!Undue!Influence!–!........................................................................................................!80! Class!2B!Undue!Influence!–!.........................................................................................................82 ! ! Undue'Influence'and'Third'Parties'–'.........................................................................................'83! Rebuttal'of'Undue'Influence.'...................................................................................................'83! Independent!Advice!–!..................................................................................................................!84! Lack!of!Improvidence!(Lack!of!foresight,!or!thoughtfulness)!–!...................................................85 ! ! General'Equitable'Defences'–'...................................................................................................'86! Undue'Influence'and'Third'Party'Guarantees'–'........................................................................'87! The'Yerkey'v'Jones'Principle'–'..................................................................................................'87! Remedies'–'..............................................................................................................................'90! Related'Doctrines'–'..................................................................................................................'90! Unconscionability'–'.........................................................................................................'90! What’s!the!difference?!................................................................................................................!90! Duress!–!.................................................................................................................................................!90! Undue!Influence!–!..................................................................................................................................!90! Unconscionability!–!................................................................................................................................!90! KEY!CASE!–!Commercial!Bank!of!Australia!Ltd!v!Amadio!(1983)!151!CLR!447!–!....................................!91! Elements'of'Unconscionable'Transactions'–'.............................................................................'91! 1!–!Special!Disadvantage!or!Disability!–!......................................................................................93 ! ! 2!–!Knowledge!–!..........................................................................................................................95 ! ! 3!–!Unconscientious!Exploitation!of!the!Disadvantage!–!............................................................96 ! ! Defences'–'...............................................................................................................................'96! Remedies'.................................................................................................................................'97! Unconscionability'and'Undue'Influence'–'.................................................................................'97! Statutory'Unconscionability'–'An'Overview'–'...........................................................................'99! Unconscionable!conduct!within!the!meaning!to!the!unwritten!law!–!s!20.!..............................!100! Unconscionable!Conduct!in!Connection!with!Goods!and!Services!–!s21!..................................!100! Financial!Services!–!....................................................................................................................!100! Remedies'–'............................................................................................................................'101! Illegality'–'......................................................................................................................'102! STARTING!POINT!FOR!ILLEGALITY!–!.....................................................................................................!102! Contracts'Prohibited'by'Statute'–'...........................................................................................'103! Contracts!Prohibited!by!Statute!–!.............................................................................................104 ! ! Contracts!Impliedly!Prohibited!by!Statute!–!..............................................................................!104! Common'Law'Illegality'–'........................................................................................................'107! Contracts!Made!with!the!Intention!of!Acting!Unlawfully!–!.......................................................!107! Contracts!Prejudicial!to!the!Administration!of!Justice!–!............................................................!108! Contracts!to!Oust!the!Jurisdiction!of!the!Courts!–!....................................................................108 ! ! Contracts!Promoting!or!Causing!Conflict!between!one’s!Public!Duty!and!Private!Interest!–!...!108! Contracts!that!Promote!Sexual!Immorality!and/or!Prejudice!the!Status!of!Marriage!–!...........108 ! ! Contracts!with!Enemy!Aliens!–!..................................................................................................!108! Contracts!in!Restraint!of!Trade!–!...............................................................................................!109! Assessing!the!‘reasonableness’!of!a!restraint!of!trade!-!............................................................!111! Vendor!–!Purchaser!Restraints!(Sale!of!business)!–!...................................................................!112!

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4 Employer!–!Employee!Restraints!–!............................................................................................!112! Protection!of!Trade!Secrets!–!...............................................................................................................!113! Protection!of!customer!connections!and!goodwill!–!...........................................................................!114!

Trader!Agreements!–!.................................................................................................................!115! Other!Situations!–!......................................................................................................