Prominent Cases & Acts (BIZ LAW) PDF

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Important CasesPinnel’s Case (1960)Chapter 4: Consideration and Intention to Create Legal RelationsPinnel sued Cole for a debt of £8, 10 Shillings of which was due to be paid on 11 November 1600. Cole argued that, at Pinnel’s request, he had paid £5, 2 shillings, 6 pennies to Pinnel on 1 October whi...

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Important Cases Pinnel’s Case (1960) Chapter 4: Consideration and Intention to Create Legal Relations Pinnel sued Cole for a debt of £8, 10 Shillings of which was due to be paid on 11 November 1600. Cole argued that, at Pinnel’s request, he had paid £5, 2 shillings, 6 pennies to Pinnel on 1 October which Pinnel accepted in full satisfaction of the debt. The court held that: “...payment of a lesser sum on the day in satisfaction of a greater [sum] cannot be any satisfaction for the whole... But the gift of a horse, hawk or robe, etc. in satisfaction is good... {because it] might be more beneficial to the plaintiff than the money... [Similarly], the payment and acceptance of [a part] before the day in satisfaction of the whole would be a good satisfaction... [because the part] ... before the day would be more beneficial to him than the whole at the day, and the value of the satisfaction is immaterial Application: Part payment of a debt does not discharge the entire debt unless the part payment was made earlier, at a different place, or in conjunction with some other valuable consideration.

Central London Property Trust v High Trees House Ltd (1947) Chapter 4: Consideration and Intention to Create Legal Relations In 1937, the defendant obtained from the plaintiff a 99-year lease of new block of flats. The rent was 2,500 pounds per year and the agreement was under seal. The defendant then sub-leased the flats to others. In 1940, because of the war, the defendant could not find subtenants. The defendant and the plaintiff agreed to reduce the rent to 1,250 pounds per year. This arrangement was in writing but not under the seal. By 1945, the flats were fully leased to sub-tenants. Throughout this period, the defendant paid the reduced rent. Later, the receivers for the plaintiff sued the defendant claiming that the full rent was payable for the last two quarters of 1945 and the future. The court held that the receivers succeeded in their blame on the basis that the 1940 arrangement was intended to be a temporary one due to the exigencies of the war. Denning J, however, expressed an obiter dictum stating that, if the receivers wished to claim the full rent for the period 1940-45, then they would fail because they would be estopped by the plaintiff’s 1940 promise not to enforce its full legal rights, even though that promise lacked consideration. Application: Promissory Estoppel must have 4 key elements in order to be established. 1. Parties must have existing legal relationship 2. There must be a clear and unequivocal promise which affects the legal relationship 3. Promisee relied upon the promise and altered his position 4. It is inequitable for the promisor to go back on his promise *Promissory Estoppel can only be used as a “Shield, not Sword”.

Williams v Roffey Brothers and Nicholls (1991) Chapter 4: Consideration and Intention to Create Legal Relations Brothers subcontracted carpentry work to Williams for a fee. William ran into difficulties and could not complete on time. Roffey Brothers was anxious that the delay would make them liable under the main contract for late completion, hence Roffey Brothers promised to pay an additional sum. Williams completed the work on time but Roffey brothers refused to pay the additional sum. Application: As long as the extra payment was not given under duress or fraud, the fresh promise was enforceable because the party obtained “practical benefits” for the other party’s work. The “practical benefit” in the case was that the William Brothers would not be liable under the main contract for late completion.

Hong Kong Fir Co Ltd v Kawasaki Kaisen Kaisha Ltd (1962) Chapter 5: Terms of contract Kawasaki chartered Fir’s ship, but the ship’s engine-room crew was insufficient in number. Fir admitted it had breached the term of the charter which required the ship to be in “in every way fitted for ordinary cargo service”. Kawasaki repudiated the contract and refused to pay. The court held that Fir had breached an innominate term, but the breach was not sufficiently serious to entitle Kawasaki to repudiate the contract. Kawasaki could only claim damages. Application: Term that is too hard to classify as either a condition or warranty. Consider if the occurrence of the event deprives the party of substantially the whole benefit which was intended upon him as consideration for performing those undertakings?

Thompson v London Midland Scottish Railway Co (1930) Chapter 5: Terms of contract Thompson bought a railway ticket which contained the words “for conditions, see back.” The back of the ticket contained an EC against personal injury and sued the railway company. Application: Ticket pointed out that EC was at the back of the ticket. Hence there was reasonably sufficient notice given and the EC was valid. (Adequacy of notice)

Chapelton v Barry Urban District Council (1940) Chapter 5: Terms of contract Chapelton hired 2 deck chairs from Barry. There was a notice near the chairs that instructed hirers to collect and retain a ticket. Chapelton collected the ticket without reading it. He sat on one of the chairs which collapsed under him. He sued Barry for damages and Barry sought to rely on the EC printed on the ticket Application: No reasonable person would expect to find contractual terms on a ticket since it would be regarded simply as a receipt. Party cannot rely on EC to exclude liability of contract.

CLAAS Medical Centre v Ng Boon Ching (2010) Chapter 6: Vitiating Factors Application: If the case of an unreasonable restraint of trade clause, clause can still be saved if the part considered to be unreasonable can be severed from the clause (blue pencil test)

Redgrave v Hurd (1881) Chapter 6: Vitiating Factors When Redgrave sold his house together with law practice to Hurd, Redgrave had misrepresented the value of his practice. Although Hurd had the opportunity to check, he didn’t do so. Application: The opportunity to check does not deprive the plaintiff of his right to rely on misrepresentation.

RDC Concrete v Sato Kyogo (2007) Chapter 7: Discharge Application: Situation 1: Contract states clearly that in the event of a certain breach, the innocent party may terminate the contract. Situation 2: Where a party, by his words or conduct, renounces all his obligations under the contract, the innocent party is entitled to terminate the contract [Anticipatory Breach]

Situation 3(a): Where a party breaches a condition of the contract, the innocent party can terminate the contract regardless of the consequences of the breach. Situation 3(b): Regardless of the type of term breached (e.g. even warranty), if the consequences of the breach deprive the innocent party of substantially the whole benefit which it was intended that the innocent party should obtain from the contract.

Planche. V Colburn (1831) Chapter 7: Discharge Planche agreed with Colburn to write a book for £100. He completed part of the book when Colburn abandoned the project. Application: If the plaintiff is prevented from performing his performance by the defendant, the plaintiff is entitled to remuneration for his work based on a quantum merit basis.

Sports Connection v Deuter Sports (2009) Chapter 7: Discharge Application: Introduced a very rare and barrow exception to rules spelt out in RDC Concrete. If the contract expressly states that a clause is a warranty and clearly and unambiguously states that a breach of it would never entitle the innocent party to terminate the contract -> the court would give effect to such a clause and the contract cannot be terminated when the warranty is breached.

Hadley v Baxendale (1854) Chapter 8: Damages and Equitable Remedies The operation of Hadley’s mill was halted because of a broken crankshaft. Hadley engaged Baxendale, a common carrier, to transport the crankshaft to the manufacturer in Greenwich so that the manufacturer could produce a new crankshaft. Baxendale delivered the crankshaft late, causing a delay in the mill recommencing operations. Hadley sued for loss of profit caused by the delay as the mill remained closed until the new shaft was delivered. On the facts, the court held that such loss suffered by Hadley was not a usual loss arising naturally as it was unusual for a mill not have a spare shaft in the case of such exigencies. As the loss was unusual, before Baxendale was liable, Hadley must have actually told Baxendale that the delivery of the new crankshaft must not be delayed since he had none to spare. Hadley did not tell Baxendale this. Thus, the court held that Baxendale was not liable for the loss of profit. Application: By applying the Hadley v Baxendale test, losses that are too remote are not recoverable. Losses must fall within one of the two limbs to be recoverable

1st limb (Normal losses): Such losses arising from usual circumstances (according to the usual course of things from the breach itself) 2nd limb (Abnormal losses): Such losses arising from special circumstances. Such damages may reasonably be supposed to have been the contemplation of both parties at the time they made the contract.

Dunlop Pneumatic Tyres Co Ltd v New Garage & Motor Co Ltd (1915) Chapter 8: Damages and Equitable Remedies

Application: 3 factors spelt out to determine whether LDC is a penalty or genuine preestimate of loss 1. Sum in the LDC is extravagant and unconscionable compared with the greatest conceivable loss  likely to be penalty 2. Sum is greater than sum payable under contract  likely to be penalty 3. Payable on the occurrence of one or more or several events  likely to be penalty

Hedley Byrne v Heller & Partners (1964) Chapter 9: Law of Tort Application: Plaintiff relied on references and incurred huge losses. If not for disclaimer, defendant will be liable since there was a duty of care owed due to special relationship formed.

Spandeck Engineering v DSTA (2007) Chapter 9: Law of Tort Spandeck contracted with DSTA to redevelop a medical facility. Spandeck sued DSTA, claiming that DSTA owed a duty of care to apply professional skill and judgement in certifying Spandeck’s work in a fair and unbiased manner. Application: Use the Spandeck test to determine if there is a duty of care with the preliminary requirement and two-stage test.  Preliminary requirement: Factual foreseeability  First stage: Proximity (physical, casual and circumstantial)  Second stage: Policy that negates duty of care Scott v London & St Katherine Docks (1865)

Chapter 9: Law of Tort Plaintiff was entering the doorway of the defendant’s warehouse when six sacks of sugar fell from a crane onto him Application: Res Ipsa was established because the act was under the control of the defendant and the accident could not, in the ordinary course of things, have occurred without negligence of the defendant.

VARIOUS ACTS

Frustrated Contracts Act (FCA) S2(2) Any monetary benefits conferred prior to the time of discharge is recoverable and any money payable ceases to be payable. S2(3) Expenses incurred before discharge may be recoverable if just to do so S2(4) Any non-monetary benefits conferred can be compensated with an amount the court considers just.

Unfair Contract Terms Act (UCTA) * UCTA Schedule 2 is used for goods/services (Although schedule 2 only refers to goods, we can refer to it as guidelines to refer to for contracts)

S1(3) Liability for breach of obligations only applies to business liabilities S2(1) Liability of negligence for death or personal injury cannot be excluded by an EC S2(2) Liability of negligence for other losses or damages can be excluded if the clause passes the test of reasonableness S3 Party can exclude liability if EC is reasonable S11(1) Reasonableness test: Court must consider whether; 1. Injured party knew of EC 2. Injured party ought to have reasonably known of EC 3. EC was in contemplation of parties when contract was formed S11(2) Guidelines for reasonableness test 1. Bargaining position of the parties 2. Whether customer received an inducement to accept EC 3. Whether customer knew about the EC/previous course of dealings 4. Whether compliance with EC is practicable 5. Whether goods were specifically ordered

Electronic Transmission Act (ETA) S13(2) Time of receipt is the time when the electronic communication becomes capable of being retrieved by the addressee at an electronic address designated by the addressee S13(3) Time of receipt is the time when the electronic communication becomes capable of being retrieved by the addressee at the address and the addressee becomes aware of it at an electronic address not designated by the addressee S14 Online advertisement of goods and services via the internet will be considered as an invitation to treat unless the offeror makes it clear that he intends to be bound by it. Partnership Act S5 Every partner is an agent of the firm and any act done by him in the usual course of business will bind the firm and other partners.

Contract Rights of Third Parties Act (CRTA)

TP can only enforce a term in a contract to which he is not a party when: S2(1) Contract expressly states that TP may S2(2) Contract purports to confer a benefit on TP S2(3) TP is expressly identified in the contract by name/particular description/class although he need not have existed on date of contract

Promisor/Covenanter – person who makes the promise Promisee/Convenantee – person who receives the promise Defendant – individual/company sued or accused in a court of law Plaintiff/Appellant – person who brings a case against another in court of law...