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Contract Law.docx

6 Pages

Legal Studies
Course Code
LS 101
Frances Chapman

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LS 101 CONTRACT LAW THURS. NOV. 1, 2012/ TUES. NOV 6/8 Introduction to Contract Law  Choice if you want to enter into contract with obligations  Important function to govern commerce  Governs voluntarily relationship  Protect property, prevent fraud, and ensure people live up to deals that they make  2 ideals: 1. Individuals should be given the freedom of choice 2. Law acts to restrain our conduct to protect society  Power differential: help those with less power  Contracts can be oral and accepted as informal as a handshake Basic Principles of Contract Law  Largely common law study  Sale of Goods Act: legislation that regulates how we contract with other  Law of contracts is universal  Contracts concerned with the exchange of goods and services  People voluntarily enter into contracts, not forced  Almost anyone can enter contracts  Court looks at actions of the parties o An offer by one party that was definitely accepted by the other o Not concerned about fairness of contract o Not the courts role to determine fairness of bargains struck o Enforce clear intention of the parties o Courts only step in if one party is disabled to make reasonable decisions o Courts will not undo a contract if done, but it not done yet they will not help to enforce it Definition of a Contract: an agreement between two or more parties that is binding in law which gives rights and/or obligations which the courts may enforce o Starts with a promise o If something goes wrong, courts decide whether to infer o Freedom to contract  Fundamental principle of law o Fundamentally wrong  Unfair dealings  Vulnerable populations o Terms of the contract  Expressed (stated) or Implied (unstated)  Language must be specific and certain o Looks at damages Bilateral Contract  Traditional contract  Contract where the offeror and offerer trade promises and bond to perform  2 specific people – each promises to do something Unilateral Contract  One party promises to do something in exchange for an act of the other party  Ex. Reward for lost dog  Offered to world at large  Can be accepted by more than one person LS 101 CONTRACT LAW THURS. NOV. 1, 2012/ TUES. NOV 6/8  Subsidiary promise: implied promise that offeror cannot revoke offer once offerer starts preforming contract Written Contracts  Contracts do not need to be in writing but writing makes evidence of agreement  Statute of Frauds 1677- some contracts must be in writing  Several categories must be in writing: o Guarantees and indemnities o Not performed in 1 year  long term contract  people forget o Contracts for property o Promises in consideration of marriage  Dowry o Executor to a will o Misc. other statutes o Sales of Goods Act: goods over certain $ must be evidenced in writing o Electronic documents  Clicking “I Agree”  Written documents are taken seriously  Cannot change terms of agreement  No opportunity to negotiate  Even if a contract is in writing, there can still be disputes that the contract is not complete Ingredients to a Contract 1. Consensus o Both parties agree to terms of contract and are fully aware o Consensus ad idem “meeting of the minds” o Reasonable person test: what would person thought towards contract? o Courts won’t allow a person to escape from a contract by claiming not read/understood o Protect reasonable expectation of the parties o 3 elements: offer, acceptance  OFFER: promises of willingness by one party to enter into a contract with another party on certain terms and conditions, offeror makes the offer, offeree accepts contract. May be expressed or implied. May be to one person, or group.  Termination of offer, 6 ways : 1. Refusal by saying no 2. Lapse of time: when offeror says offer will only be available for certain time 3. Lapse of reasonable time, no specific time, look at subject matter, mode of communication 4. Failure of a condition, death of offeror 5. Revocation, offeror can revoke offer until accepted but must be communicated by offeror to offeree, use instantaneous method of communication. If offeror revokes offer, offeree cannot accept because there’s no longer an offer 6. Counter offer – new terms. Original offer has been void.  ACCEPTANCE: expressed terms/conditions are acceptable and the individual is willing to be bound by them. Acceptance indicates willingness to be bound. LS 101 CONTRACT LAW THURS. NOV. 1, 2012/ TUES. NOV 6/8 Must be communicated by written/verbal. Offer may be accepted at time until revoked, but offer can be revoked any time before accepted.  Reasonable person test  Place: communication is completed where it is received by the offeror.  To be valid offer must be communicated by other party orally/written/conduct  Only group/person whom offer is made to may accept  Cannot accept terms of contract by silence, but be by words or actions  “Post Box Rule”: exception to communication principle, acceptance is deemed to be effective at the time and place it is posted. 2. Consideration o Tool that courts use to see if they should enforce a promise o Requirement that both parties agree to agreement, pay a price, and both parties receive a benefit o Price is not only money, but anything of value being exchanged for the promise of the other party o Parties must show there was detriment/benefit to one party o Whether consideration has been exchange is fundamental issue in contract o Don’t need consideration when contract is under “seal”  Historic way to create an enforceable promise  Stamp  Sign of legitimacy o Consideration must be sufficient, not necessarily adequate, must be specific  Have some value, but not necessarily adequate so it doesn’t have to be equal in value o Gratuitous promise is not consideration  A gratuitous promise is a one-sided promise  It’s unenforceable o Consideration is distinct from motive  Cannot be illegal  Cannot be agreement to do illegal act
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