Textbook Notes (369,082)
Canada (162,376)
LAW 122 (625)
Stan Benda (71)
Chapter 1

Chapters 1, 2, 3, 4,

41 Pages

Law and Business
Course Code
LAW 122
Stan Benda

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Handout: - Some contractual terms are implied by statutes. - Sales of Good Act where all common law jurisdictions in Canada have the same legislation and whereas the other jurisdictions have consumer protection laws. - Parties signing contracts opt out of the default rules that the Sales of Goods Act provides. - The CPA requires that for consumer agreements, attempts to negate a condition or warranty under the Sales of Goods Act will be void and of no effect. - The SGA applies to sales of goods for money, not land or intangibles. - Its always important to know at which point the property was transferred from the seller to the buyer. RISK MANAGEMENT: Owners should have insurance; theres a difference between property and possession. - The SGA has several rules as to when property passes: 1. Where there is an unconditional contract for the sale of specific goods in a deliverable state, the property in the goods passes to the buyer when the contract is made, even if DELIVERY OR PAYMENT IS POSTPONED. 2. When there is a contract for the sale of specific goods and the seller is bound to do something to the goods for the purpose of putting them into a deliverable state, the property DOES NOT PASS UNTIL SUCH THING IS DONE and the buyer has been NOTIFIED. 3. Where there is a contract for sale of specific goods in a deliverable state but the seller is bound to weigh, or do another act in order to state the price, the property does not pass until such act is done and the buyer has been NOTIFIED. 4. When goods are delivered to the buyer or approval or on sale or return, the property pases to the buyer when the buyer signifies approval acceptance or adopts the transaction or retains the goods beyond a reasonable time. 5. Where there is a contract for the sale of future goods by description, the property in the goods passes to the buyer when goods of that description in a deliverable state, are unconditionally appropriated to the contract by one party with the other partys assent. - It is very uncommon for merchants to opt out of these rules by stating that title to the goods remains with the seller until the full price of the goods has been received by the seller. - Other important implied terms under the SGA are: 1. Sellers title to sell the goods: - The act implies a condition that the seller has the right to sell the goods - The act implies a warranty that the buy we receive clear title. 2. Nature of the goods: - Goods sold by the description will meet the description - Goods sold by sample will correspond to the specimen - Goods will be of merchantable quality - Goods will be fit for the intended purpose. 3. Delivery and Payment: - Unless otherwise agreed, delivery and payment should occur at the same time. - Time of delivery is a condition. Condition meaning if the innocent party would be substantially deprived of the expected benefit of the contract if a breach occurred. Since the customer was deprived of what he originally asked for, he should not be required to uphold his end of the bargain. - Time of payment is a warranty. Warranty meaning if the innocent party would not be substantially deprived of the expected benefit of the contract if a breach occurred. Since the customer received his big truck and not the van, although not clean, he must upheld his end of the bargain. - Implied condition that seller will deliver goods that conform to the contract. The Ontario Consumer Protection Act, 2002 (CPA) - consumer means an individual acting for personal, family or household purposes and does not include a person who is acting for business purposes (s. 1) - consumer agreement means an agreement between a supplier and a consumer in which the supplier agrees to supply goods or services for payments. (s.1) - this Act applies in respect of all customer transactions if the consumer or the person engaging in the transaction with the consumer is located in Ontario when the transaction takes place (s.2). - Section 9 of the Act states: (1) The supplier is deemed to warrant that the services supplied under a consumer agreement are of a reasonably acceptable quality. (2) The implied conditions and warranties applying to the sale of goods by virtue of the SGA are deemed to apply with necessary modification to goods that are leased or traded or otherwise supplied under a consumer agreement. (3) Any term or acknowledgement, whether part of the consumer agreement, that purports to negate or vary any implied condition or warranty under the SGA or any deemed condition or warranty under this Act is void. The result of the provisions is that a consumer CANNOT opt out of his or her rights under the SGA. That is the goods must be of reasonably acceptable quality. Chapter 7: I. Introduction: A contract is an agreement that creates rights and obligations that can be enforced in law which is involved in the mutual exchange of value. We were able to get into that agreement because we had a meeting of the minds. Rights and obligations usually lie quietly beneath the surface while the future unfolds as the parties expected. Ex: When I buy a book from the bookseller, he offers me a money back guarantee if anything happened to the book. Most of the times, booksellers wont need to refund anyones money, because the book isnt going to fall apart. Many rights within contracts arent actually put in action because everyone expects what they signed up for. In the case that it isnt, guarantees are available. Most of the problems in court that do arise are avoidable because these problems occur when people dont think of the legal consequence of their actions. If they did, court could be avoided. Quid pro quo: something for something. Tort Vs Contract summary: Source of Privity Compensatory Risk obligation damages Management Tort Imposed by law Enforceable Place the plaintiff - may take a regardless of any as if the tort did person by agreement not occur surprise between the - may require parties more than a person is able to give Contract Voluntarily Enforceable only Place the plaintiff - always possible created by the by or against a as if contract to know the parties party to the performed obligations in contract advance - and to limit them to promises that can be fulfilled. II. Objectives: 10 objectives. 1. Identify the three essential elements of most contracts: The parties must have an intention to create legal relations They must reach a mutual agreement through the process of offer and acceptance. They must enter into a bargain by each giving consideration. Intention to create legal relations: o The intention to create legal relations arises if a reasonable person would believe that the parties intended to create a legally enforceable agreement. o The judge would ask what would a reasonable person think, not what the two parties involved in the contract think. o Negligent misrepresentation is very similar but there are minor differences. 2. Outline the situations in which people generally do or do not have an intention to create legal relations. o Social and family agreements are not necessarily contracts. A father is not liable for promising to get his daughter a car but never did but there was no intent to create legal relations. Courts normally presume that an intention to create legal relations exists in commercial context only, not between family and friends. However there are some exceptions; a son may be able to persuade a judge that his mom promised to pay his tuition under contractual obligations. Offer and Acceptance: Offer: 3. Distinguish between an offer and an invitation to treat: o An offer is an indication of a willingness to enter a contract on certain terms. o An offeror is a party who offers to enter into a contract. o An offeree is a party who receives an offer to enter a contract. o Suppose you offered to sell cars on a website you would have to put first come first serve basis for example in order to not be bound to unmanageable number of contracts. o A statement is not an offer unless it is communicated and received as an offer. o Deals on napkins are considered contracts; they dont have to be in any particular form. o When you buy a cheese burger and a milkshake, you offer to enter a contract for the purchase of the meal. When you enter a barber shop, you offer to sit silently in a chair and get a trim; the barber accepts. The life of an offer: 4. 5 reasons contracts may cease to exist: Revocation: occurs if the party who made the offer withdraws it.
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