!Week7&!(intention&Agreement)!–"!
time"specified"by"the"offeror,"or"else"a"‘reasonable’"time" 12.A.Common" mistake33The" mistake" must" be" about" the"
Formation1&Intetion!!!!!!!!!!!!!!!!
(Ramsgate(Victoria(Hotel(Co(Ltd(v(Montefiore)."
existence" of" the" subject" matter" of" the" contract" (Leaf" v"
1.Where"the"agreement"between"the"parties"is"of"a"non3 19.Options" will" be" unenforceable" unless" it" is" supported" International"Galleries).""
commercial"nature,"it"is"presumed"that"the"parties"do"not" by" the" offeree’s" consideration(Goldsborough( Mort( v( 13.Mistakes" as" to" the" quality," nature" or" value" of" the"
intend"to"create"legal"relations"(Balfour(v(Balfour).
subject"matter"will"not"affect"the"contract"at"common"law"
Quinn)
""
!
(Leaf"v"International"Galleries)
.""
Formation!2!–!Agreement&Acceptance!
2." Where" the" agreement" between" the" parties" is" of" a" An! acceptance! converts! the! offer! into! an! agreement.! 14.B.Mutual"mistake33To"determine"whether"the"contract"
commercial" nature," it" is" presumed" that" the" parties" do" Before! acceptance,! neither! party! is! bound,! after! is"void"or"not" Would"a"reasonable"person"consider"that"
intend" to" create" legal" relations" (Edwards( v( Skyways( Ltd) acceptance,!the!parties!are!bound.!
there"was"an"agreement"between"the"parties?"(Raffles"v"
"
20.Rule"1:"Acceptance"must"be"in"reliance"on"the"offer(R( Wichelhaus).
"
A.Social!arrangement:!!
15.C."Unilateral"mistake3The"court"will"declare"a"contract"
v(Clarke)
reward"
3."The"presumption"in"social"arrangements"is"that"there"is" 21.Rule" 2:General" rule" is" that" acceptance" must" be" void" for" unilateral" mistake" where" (Boulton" v" Jones):(a)"
no"intention"to"create"legal"relations"(Balfour"v"Balfour).! communicated" either" by" words" or" conduct" (Felthouse( v( one"party"is"mistaken"as"to"the"identity"of"the"other"party;"
4." But" this" presumption" can" be" rebutted" as" in" Trevey" v" Bindley).
(b)" the" identity" of" the" party" is" a" fundamental" aspect" of"
!
Grubb.(eg:" lottery" $218" 000," even" though" this" was" a" 22.Silence" on" its" own" on" the" part" of" the" offeree" is" the"contract"and";c)"the"other"party"knows"of"the"mistake"
social"arrangement,"there"was"a"contract)"
16.Where"the"parties"meet"face3to3face,"there"is"a"strong"
insufficient"(Felthouse(v(Bindley)(
B.Family!or!domestic!agreements!!
23.Acceptance" must" be" made" in" accordance" with" the" presumption"that"a"contract"was"concluded"between"the"
5." In" the" case" of" domestic" agreement" made" while" the" terms" of" the" offer.So" where" the" offeror" specifies" a" parties"because"the"offer"was"accepted"by"the"person"to"
husband"and"wife"are"still"living"together"or"in"a"de"facto" particular" method" of" acceptance," it" must" be" followed" whom"it"was"directed"(Lewis"v"Averay).
"
relationship,"it"is"presumed"that"the"parties"do"not"intend" exactly"(Gilbert(J(McCaul((Aust)(Pty(Ltd(v(Pitt(Club(Ltd).(
17.The" rule" is" that" if" a" party" signs" a" contract," they" will"
to" create" legal" relations" in" relation" to" promises" made" to" Postal! Acceptance! Rule! (PAR)" only" applies" where" post" generally" be" bound," whether" they" have" read" them" or"
each"other"(Balfour"v"Balfour).(wife"sue"the"husband,"no)! was" contemplated" (eg" if" the" offer" was" made" by" post," or" not(L Estrange"v"Groucob).
"
6." This" presumption" can" be" rebutted" (Popiw" v" Popiw). that"post"was"specified"as"being"acceptable).""
18.To" succeed" in" a" plea" of" non" est" factum," it" must" be"
eg:
,there"is"intention "
24.PAR! states:" If" acceptance" by" post" was" contemplated" shown"that"(Petelin"v"Cullen):(a)The"person"believed"that"
7.Domestic" arrangements" between" other" family" by" the" parties," acceptance" occurs" when" the" letter" is" the"document"they"signed"is"radically"different"from"what"
members" are" also" presumed" not" to" be" legally" binding" posted," not" when" it" is" actually" received" (Adams" v" they" believed" it" to" be." The" mistake" must" go" to" the"
(Balfour"v"Balfour)."
fundamental"nature"of"the"document,"not"its"contents;(b)"
Lindsell).""""
8.But" Courts" may" rebut" the" presumption" if" the" 25."Under"the"PAR:"Acceptance"is"effective"as"soon"as"it"is" absence"of"carelessness"in"the"execution"of"the"document."
consequences" of" the" promise" are" serious" for" one" of" the" posted."
19.The" class" of" persons" who" can" raise" this" defence" are"
parties" and" they" have" changed" their" position" in" reliance" 26.but!note:"an"offer"made"by"letter"is"not"effective"until" limited"to"(Petelin"v"Cullen):"(a)Those"who"are"unable"to"
on"the"promise"that"has"been"made"to"them"(Wakeling"v" received" by" the" offeree.33Revocation" of" the" offer" by" read"due"to"blindness"or"illiteracy"and"who"must"rely"on"
Ripley).(eg:"
)"
letter–" to" be" effective" must" be" received" by" the" offeree" others"for"advice"about"what"they"are"signing (b)Those"
C.voluntary!agreements!!
before"they"post"their"letter"of"acceptance"(Byrne"v"Van" who" through" no" fault" of" their" own" are" unable" to"
9.In" voluntary" agreements" such" as" participation" in" Tienhoven).offer
post
"
understand"the"meaning"of"a"particular"document.""
charitable" or" other" voluntary" organisations," the" 27."If"PAR"is"excluded"then"acceptance"is"when"the"letter" Unconscionable!Conduct
!
presumption" is" that" the" parties" do" not" intend" that" is"received"(Adams"v"Lindsell)."
20.For" a" contract" to" be" set" aside" on" the" grounds" that" it"
agreement" to" be" legally" binding" (Teen" Ranch" Pty" Ltd" v" 28.Instantaneous
" forms" of" communication" (such" as" was" unconscionable," the" plaintiff" must" prove"
Brown).
!
phone," fax)" require" actual" receipt" of" the" acceptance).In" (Commercial"Bank"v"Amadio):"(a)They"were"in"a"position"
D.!Commercial!agreements!!
these"cases,"the"contract"is"formed"when"the"acceptance" of" special" disadvantage" at" the" time" of" the" contract;(b)It"
10." The" presumption" in" commercial" agreements" is" that" is"received"(Entores"Ltd"v"Miles"Far"East"Corp)"
must" have" substantially" affected" their" ability" to" protect"
the" parties" have" an" intention" to" be" legally" (Edwards" v" 29.Rule3:!Must!be!absolute!and!unqualified.!Acceptance! themselves;(c)The"defendant"must"have"known"or"should"
Skywards"Ltd).!
with! a! condition! attached! is! not! acceptance! (Masters! v! have" known" of" the" plaintiff s" disability" and" had" taken"
11." This" presumption" can" be" rebutted" –" for" example," if" Cameron)!
advantage"of"it."
the"parties"use"clear"wording"to"that"effect:""
30.Rule! 4:! Acceptance! cannot! be! revoked.Once! the! 21.What" amounts" to" special" disadvantage" is" difficult" to"
A.Letters" of" comfort" (Kleinwort" Benson" Ltd" v" Malaysian" offeree! accepts! the! offer,! an! agreement! has! been! accurately"define,"but"includes"sickness,"illiteracy,"lack"of"
Mining" Corporation" Bhd)
reached.!!
education"(Blomley"v"Ryan)."
"
Week8(Consideration&Consent!
Week9(Terms!of!the!Contract!)!!
B.‘" this" agreement" is" subject" to" contract’" (Masters" v" Formation3.Consideration!
Term!or!representation?Whether!a!statement!is!a!term!
Cameron);""
1." Consideration" is" essential" to" the" validity" of" every" of! the! contract! or! merely! a! representation! that! is! not!
Honour" clausesC.‘binding" in" honour" only" Agreement" simple"contract"(Rann"v"Hughes).A B!$100!
part! of! the! contract! depends! on! the! intention! of! the!
contains" a" term" ‘binding" in" honour" only’" shows" the" 2.Consideration"that"is"too"vague,"illegal"or"impossible"is" parties(
)!
parties" don’t" intend" to" be" legally" bound." (Rose" &" Frank" not"valid"consideration"(White(v(Bluett).
"
1.The" Court" applies" an" objective" test" (Dick" Bentley"
Company" v" JR" Crompton" &" Bros" Ltd)" " D" ‘Shall" not" be" 3.Consideration" must" move" from" the" promisee" (Dunlop( Productions"Ltd"v"Harold"Smith"Motors"Ltd)!
attended"by"or"give"rise"to"any"legal"relationships"(Jones"v" Pneumatic(Tyre(Co(Ltd(v(Selfridge)"
2.Objective"factors:A.Time"lapse"between"statement"and"
Vernon’s"Pools"Ltd)."
4.Consideration"must"not"be"past"3Consideration"may"be" final" agreement" –" the" longer" the" lapse" of" time" between"
12.Anyone"wishing"to"rebut"the"commercial"presumption" present"(executed)"or"future"(executory)"but"may"not"be" the"making"of"the"statement"and"the"final"agreement,"the"
bears"a"heavy"onus"of"proof"(Edwards(v(Skyways(Ltd)."
past."(Roscorla(v(Thomas).&
EG:
!
more"likely"it"is"to"be"treated"as"an"inducement"and"not"
Formation!2!–!Agreement&Offer!
5." Consideration" must" be" sufficient" but" need" not" be" intended"to"form"part"of"the"agreement.""
Rule!1:!Offers!must!be!distinguished!from!an!invitation! adequate"(Chappell(&(Co(Ltd(v(Nestle(Co(Ltd).""
B." What" importance" did" the" parties" attach" to" the"
to! treat! or! request! for! information&&! Offer! or! Invitation! """The" question" of" what" is" ‘sufficient’" " is" not" always" clear" statement" 3" if" the" parties" place" considerable" importance"
to!Treat?
!
cut." A" number" of" situations" can" be" identified" which" can" on"the"statement,"the"courts"will"be"more"willing"to"treat"
13.Goods" displayed" on" shelves" or" shop" windows" are" amount"to"insufficiency:"
it"as"a"term"and"not"a"mere"representation."
considered" to" be" an" invitation" to" treat" (Pharmaceutical" More!on!sufficient!!consideration."""
"C."Did"one"of"the"parties"have"special"skill"or"knowledge"–"
Society"v"Boots"Cash"Chemists)
"
6.Repeating" an" existing" duty" imposed" by" law" is" not" where" one" of" the" parties" had" some" special"
14."Advertising"of"goods"or"services"in"newspapers"or"on" sufficient"consideration"(Collins(v(Godefroy)."
"
skill/knowledge" not" possessed" by" the" other" party" with"
radio," television" or" Internet" are" generally" considered" to" 7.Repeating"an"existing"duty"owed"to"the"promisor"is"not" regard" to" the" subject" matter" of" the" contract," the"
be" an" invitation" to" treat" (Partridge" v" Crittenden)," but" sufficient"consideration"(Stilk(v(Myrick).
(
statement"is"more"likely"a"term."
sometimes" can" be" held" to" be" an" offer" (Carlill" v" Carbolic" 8.if" the" performance" was" beyond" what" a" person" was" The!Parol!Evidence!Rule
!!
Smoke"Ball).
"
legally" required" to" do," then" that" would" amount" to" good" 3.The! Parol! Evidence! Rule:"For"a"contract"in"writing,"the"
15." Price" lists," circulars" and" catalogues" –" these" are" consideration( (Glasbrook( Bros( v( Glamorgan( County( court" will" not" generally" admit" evidence" of" acts" or" words"
considered" as" a" general" rule" to" be" invitations" to" treat" Council)(
!
of"the"parties"prior"to"the"execution"of"the"document"if"it"
(Grainger"&"Sons"v"Gough).
" 9.Acts" in" excess" of" their" duty" would" be" good" has" the" effect" of" adding" to," varying" or" contradicting" the"
16." What" about" automatic" vending" machines" such" as" consideration"(Hartley(v(Ponsonby)."
written"agreement"(Van(Den(Esschert(v(Chappell).""
drink,"confectionary"and"self"serve"garages"selling"petrol?"
!
4.Exceptions:Other" evidence" may" be" used" if" the" written"
These"are"not"considered"as"invitations"to"treat"(Thornton" Part!payment!of!a!debt!
contract" does" not" reflect" the" “whole" of" the" agreement”"
v"Shoe"Lane"Parking"Ltd).!
offer"
10.Where!there!is!payment!of!a!lesser!sum!in!discharge! (Van(Den(Esschert(v(Chappell)
(
17.Responding" to" a" question" does" not" itself" create" an" of!a!debt,!there!is!usually!not!sufficient!consideration!to! Collateral!contracts
!
offer"(Harvey(v(Facey).eg:
offer"
support!the!discharge!(Foakes&v&Beer).!
!5.If"a"statement"can"be"regarded"as"a"collateral"contract,"
Rule! 2:! Offers! must! be! communicated! to! the! person! or! Formation4&GenuineConsent
!
so" that" the" main" contract" would" not" have" been" entered"
persons!for!whom!it!was!intended.!
!Misreprensentation
!
into" in" the" absence" of" the" earlier" statement," the" courts"
Rule!3:!An!offer!may!be!made!to!a!particular!person,!to! 11.A" misrepresentation" is" a" false" statement" of" fact" that" may"be"prepared"to"enforce"the"statement"made"by"the"
a!class!of!persons!or!to!the!whole!world(Carlill&v&Carbolic& induces" the" contract" so" that" consent" is" not" genuine" parties" before" they" entered" into" the" main" contract(de(
Smoke&Ball&Co).!
(Whittington" v" Seal3Hayne)." There" are" 3" categories" of" Lassalle(v(Guildford)
(
Rule! 4:! Offers! may! be! terminated! before! acceptance! misrepresentation:" A.Innocent:" statement3maker" does" To! successfully! argue! collateral! contract,! plaintiff! must!
takes!place.!
not" know" that" the" representation" is" false" B.Negligent:" show!
18.Offers" can" be" terminated" by:" (a)! Revocation" (ie" the" statement3maker" is" under" a" duty" of" care," and" carelessly" 6.the"statement"was"so"important"to"them"that,"but"for"it,"
offer" is" withdrawn" by" giving" notice" to" offerees)." Cases:" makes"a"false"statement"C."Fraudulent:"statement3maker" they"would"not"have"entered"into"the"contract"at"all"(de(
1.Dickinson( v( Dodds" (offer" revoked)2.Byrne( &( Co( v( Leon( knowingly" or" recklessly" makes" a" false" statement" Lassalle(v(Guildford);"
(
Van( Tienhoven( &( Co" (revoked" too" late)" (b)" Rejection" or" intending"it"to"induce"the"contract."(Derry"v"Peek)"
7.The"statement"relied"on"is"promissory"(not"descriptive)"
counter" offer" (Hyde" v" Wrench)" :" An" offer" may" be" Mistake(Mistake"of"fact)
"
(JJ"Savage"&"Sons"Pty"Ltd"v"Blakney);"
"
terminated" by" the" offeree" through" their" words" or" A.Common!mistake"(both"parties"make"same"mistake"
8.The" collateral" contract" is" supported" by" consideration"
conduct." It" may" also" be" terminated" impliedly" by" an" B.Mutual!mistake"(both"parties"make"different"mistake)"" (de(Lasalle(v(Guildford);"
counter&offer" which" also" amounts" to" a" rejection" of" the" C.Unilateral!mistake"(one"party"makes"a"mistake)"
9.The" collateral" contract" is" consistent" with" the" main"
original" offer..(c)" Lapse" of" time:" this" can" either" be" at" a"
contract"(Hoyt’s(Pty(Ltd(v(Spencer).
!