Contract Law 1-3

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'If whatever a man's real intention may be, he so conducts himself that a reasonable man would believe that he was assenting to the terms proposed by the other party, and that other party upon the belief enters into the contract with him, the man thus conducting himself would be equally bound as if he had intended to agree to the other party's terms.

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Smith v Hughes 1871

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'that upon the true construction of the documents relied upon as constituting the contract,there never was an offer by the corporation acceptance ofwhich by the tenant was capable in law of constituting alegally enforceable contract for the sale of the house. Itwas but a step in the negotiations for a contract which, owingto the change in the political complexion of the council never came to fruition' i.e. invitations for offers are not offers themselves

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Gibson v Manchester City Council 1979 war 294

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Unless the advertisement specifies that the highest tender would be accepted there was no obligation to sell to the person submitting the highest tender. The advert amounted to an invitation to treat, the tender was an offer, the defendant could choose whether to accept the offer or not. Also the word offer does not necessarily confer legal status

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Spencer v Harding 1870

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that the self-service system did not amount to an offer bythe defendants to sell, but merely to an invitation to the customerto offer to buy; that such an offer was accepted at the cashier'sdesk under the supervision of the registered pharmacist; and thatthere was therefore no infringement of the section.

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Pharmaceutical Society of Great Britain v Boots Cash Chemists 1953

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the advertisement inserted by theappellant under the title " classified advertisements " was not anoffer f o r sale b u t merely a n invitation t o treat; a n d that,accordingly, the appellant was not guilty of the offence charged.

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Partridge v Crittenden 1968

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affirming the decision of Hawkins, J., that the above facts establisheda contract by the defendants to pay the plaintiff 1001. in the event which hadhappened; that such contract was neither a contract by way of wageringwithin 8 & 9 Vict. c. 109, nor a policy within 14 Geo. 3, c. 48, s. 2; and that . the plaintiff was entitled to recover.

Also that detriment is good consideration and them purchasing the initial product is consideration

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Carlil v Carbolic Smokeball Co 1893

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that whether the firstdefendants had invited the plaintiffs and the second defendantto participate in a fixed bidding sale, only inviting fixed bids, or ^in an auction sale, enabling each bidder's bid to be adjusted byreference to the other bid, depended on the first defendants'presumed intention, which was to be deduced from the terms ofthe invitation read as a whole; that their undertaking to acceptthe highest offer, showing that they were anxious to ensure asale, their extension of the same invitation to both the plaintiffsand the second defendant, showing that they wished each to phave the same opportunity of buying the shares, and theirinsistence that the offers were to remain confidential until thetime limit for the submission of offers had elapsed, showing thatthey wished to provoke offers of the best price that each partywas prepared to pay, were only consistent with a presumedintention to create a fixed bidding sale; that the use in theinvitation of the word "offer" did not displace that presumedintention; and that, accordingly, the invitation on its true Gconstruction had created a fixed bidding sale and the seconddefendant had not been entitled to submit, and the firstdefendants had not been entitled to accept, a referential bid

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Harvela Investments Ltd v Royal Trust Co of Canada (CI) Ltd 1986

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an invitation to tender wasnormally no more than an offer to receive bids, but circumstancescould exist whereby it gave rise to binding contractual obligations;that although the defendants' form of tender did not explicitlystate that they would consider timely andconforming tenders,and although contracts were not to be lightly implied, anexamination of what the parties said and did established a clearintention to create a contractual obligation on the part of thedefendants to consider the plaintiffs' tender in conjunction withall other conforming tenders or at least that the plaintiffs'tender would be considered if others were; and that, accordingly,the defendants' failure rendered them contractually liable to theplaintiffs (see post, pp. 1201B-C, F, 1202E-H, 1203A, F-G, 1204B-D, E-F). Quaere. Whether, in the absence of any implied contractualobligations between the parties, the defendants would haveowed the plaintiffs a duty to take reasonable care to consider atender submitted before the expiry of the deadline (see post,pp. 1203A-B, 1204E).

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Blackpool and Fylde Aero Club Ltd v Blackpool BC 1990

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that there was no contract. The final telegram was not theacceptance of an offer to sell, for none had been made. It was itself anoffer to buy, the acceptance to which must be expressed and could not beimplied.

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Harvey v Facey 1893

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There was no contract. Where a counter offer is made this destroys the original offer so that it is no longer open to the offeree to accept.

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Hyde v Wrench 1840

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under the circumstances theplaintiffs'telegram at9.42ought not to be construed as a rejection of the defendant's offer, but merelyas an inquiry whether he would modify the terms of it, and that, although the defendant was at liberty to revoke his offer before the close of the day onMonday, such revocation was not effectual until it reached the plaintiffs; con- ~sequently the defendant's offer was still open when the plaintiffs accepted it, andthe action was, therefore, maintainable.

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Stevenson, Jacques and co v Mclean 1879-80

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A mere mental assent to the terms stated in a proposed contract wouldnot be binding, but acting upon those terms, by sending coals in the quan­tities and at the prices mentioned in it, amounted to sufficient to shew the adoptiou of the writing previously altered and sent, and to constitute it avalid contract. Per LORD BLACKBURN :—The onus of shewing that both parties had actedon the terms of an agreement which had not been, in dfte form, executedby either, lies upon the party who rests his case on that circumstance.

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Brogden v Metropolitan Railway Co 1876-77

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The offer to sell the machine on terms provided by Butler was destroyed by the counter offer made by Ex-Cell-O. Therefore the price variation clause was not part of the contract. The contract was concluded on Ex-Cell-O's terms since Butler signed the acknowledgement slip accepting those terms. Where there is a battle of the forms whereby each party submits their own terms the last shot rule applies whereby a contract is concluded on the terms submitted by the party who is the last to communicate those terms before performance of the contract commences.

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Butler v Ex-Cell-O Corp (England) Ltd

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if an offer stipulates acceptance by return of post - then an acceptance by telegram or personal communication would be just as good. As long as its not by detriment to the offeror

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Tinn v Hoffman 1873

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It was held that he did not act "in reliance upon the offer or with the intention of entering into any contract" - although clearly, the convictions would not have come about without his evidence

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R v Clarke 1927

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that in the context of the earlier letters the letter dated September 15, was an acceptance of the defendant's offer notwithstanding that it was not in accordance with the mode of acceptance specified; (2) that the Secretary of State's approval as to the purchase price was required for the power of completion not for the conclusion of a contract; (3) that a contract was therefore concluded on September 15; or (alternatively to (3))(4) that the offer had neither lapsed nor been refused before January 7, 1965, when it was formally accepted and a contract formed

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Manchester Diocesan Council for Education v Commercial and General Investments Ltd 1970

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Silence combined with no action can not be seen as acceptance, no matter circumstance

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Felt house v Bindley 1862

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No universal rule can cover all such cases: they must be resolved by reference to the intentions of the parties, by sound business practice and in some cases by judgment where the risks should lie. (when a contract is accepted)

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Brinkibon v Stahag Stahl and Stahlwarenhandels Gmbh 1983

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When dealing with revocation of an offer, the sending of a telex which would reasonably be read (because it is within business hours etc) would be valid because he can reasonably assumed that it was received.

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Tenax Steamship Co v Owners of the Motor Vessel Brimnes

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If in the case a phone line goes dead, the onus is on the offer to call back and accept it. If the offeror is aware of an attempt to communicate then it is up to the offeror to check.

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Entores Ltd v Miles Far East Corp 1955

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There was a valid contract which came in to existence the moment the letter of acceptance was placed in the post box.This case established the postal rule. This applies where post is the agreed form of communication between the parties and the letter of acceptance is correctly addressed and carries the right postage stamp. The acceptance then becomes effective when the letter is posted.

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Adams v Lindsell 1818

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Revocation only operates when the person is made aware and does not work with the postal rule.

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Henthorn v Fraser 1892

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The postal doesn't work for matters that are clearly absurd in terms of fairness

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Howell Securities Ltd v Hughes 1974

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A contract cannot be revoked if a party offered it has began part performance. the daughter-in-law and her husband were licensees,with no power to assign or sublet, but entitled under a personalcontract to occupy the house for so long as they paid the instal-ments to the building society, and the appeal failed.

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Errington v Errington 1952

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In some circumstances where the offer should bear the risk. Where there is an understanding because of the nature of the transaction that the offeree should bare the risk i.e. real estate.

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Luxor (Eastbourne) Ltd v Cooper 1941

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Revocations in the same median should count as being reasonable

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Shuey v US

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Being brought to mind is the ruling principle for revocation of offer. Including being informed by a third party

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Dickinson v Dodds 1875

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The importance of consideration is as a valuable signal that the parties intend to be bound by their agreement, rather than the end itself.

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Antons trawling co Ltd v Smith 2003 NZ case

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A contracting party can stipulate for what consideration he chooses. A peppercorn does not cease to be good consideration if it is established that the promisee does not like pepper and will throw away the corn. Dicta by Lord Somerville

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Chappell and co ltd v nestle co ltd 1960

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The promise of the cease of complaining is intangible and not good consideration at law

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White v Bluett

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Intangible detriments can sometimes be important enough to warrant them to be seen as consideration

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Hamer v Sidway US decision

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A promise such as not seeking legal action can be seen enough to warrant consideration despite not being tangible.

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Pitt v PHH Asset Management Ltd 1994

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'motive is not the same thing as consideration. Consideration means something which is of some value in the eye of the law, moving from the plaintiff.'

Therefore a dying man's intention to leave the house to the wife does not amount to conisderation but the exchanged promise that she pay money for its maintenance is

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Thomas v Thomas 1842

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Past consideration is not good consideration for example if the works are done before execution of the document which may even mention the consideration there is still no consideration and thus no contract

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Re McArdle 1951 ch 669

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When there is a change in an existing agreement if it is clear that one party could successfully revoke it, then the promise to not do so is valid consideration.

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Pao On v Lau Yiu Long 1980

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Consideration has to move from the party. 'In the law of England... a principle is that if a person with whom a contract not under seal has been made is to be able to enforce it consideration must have been given by him to the promisor or to some other person at the promisor's request.' Viscount Haldane Lc

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Dunlop Pneumatic Tyre Co Ltd v Selfridge n Co 1915

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Consideration does not have to move to a member of the contract

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Jones v Padavatton 1969

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Consideration has to be asked for, it cannot just be done.

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Combe v Combe 1951

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Consideration can not be made from a duty that already exists in the law.

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Collins v Godefroy 1831

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When defining a pre existing duty, one looks takes a very strict and specific view of the duty. For example normal police protection does not include special services

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West Yorkshire Police Authority v Reading Festival 2006

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The existing duty to a third party is somewhat different, for example a family deal for a son to marry someone is still valid later, even though the son is already obliged by the marriage to remain so.

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Shadwell v Shadwell 1860

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The following through of existing duties owed to the promisor are also not sufficient consideration.

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Stilk v Myrick 1809

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When analysing existing duties, if the fulfilment of the duties, where a party to a contract promised to make an additional payment in return for the other party's promise to perform his existing contractual obligations and as a result secured a benefit or avoided a detriment, the advantage secured by the promise to make the additional payment was capable of constituting consideration therefor, provided that it was not secured by economic duress or fraud; that the defendants' promise to pay the plaintiff the additional sum of £10,300, in return for the plaintiff's promise to perform his existing contractual obligations on time, resulted in a commercial advantage to the defendants; that the benefit accruing to the defendants provided sufficient consideration to support the defendants' promise to pay the additional sum; and that, accordingly, the agreement for payment of the additional sum was enforceable

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Williams v Roffey Bros n Nicholls (Contractors) Ltd 1991

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But for the fact that Roffey Bros was a decision of the court of appeal, I would not have followed it. The decision is inconsistent with the long standing rule that consideration, being the price of the promise sued upon, must move from the promisee.

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South Caribbean Trading Ltd v Traficura Beeher BV 2004 EWHC

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Part performance of debt, for example the lender agreeing that a lesser debt can be paid carries no consideration and Roffey Bros does not extend to this.

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Re Selectmove Ltd 1995 1 wlr 474

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Part performance 'may sound like a good result in terms of creditor protection, the consequence is that it makes it difficult to enter into compromise of claims, which it can often be commercially beneficial for both parties to do.'

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Collier v P n MJ Wright (Holdings) Ltd 2007 EWCA

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first principle upon which all Courts of Equity proceed, that ifparties who have entered into definite and distinct terms involvingcertain legal results... after­wards by their own act or with their own consent enter upon acourse of negotiation which has the effect of leading one of theparties to suppose that the strict rights arising under the contractwill not be enforced, or will be kept in suspense, or held in abey­ ance, the person who otherwise might have enforced those rightswill not be allowed to enforce them where it would be inequitablehaving regard to the dealings which have thus taken place be­tween the parties

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Hughes v Metropolitan Railway Co. 1877

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hat where parties enter into an arrangement which isintended to create legal relations between them and in pursuanceof such arrangement one party makes a promise to the other whichhe knows will be acted on and which is in fact acted on by thepromisee, the court will treat the promise as binding on the promisorto the extent that it will not allow him to act inconsistently with iteven although the promise may not be supported by considerationin the strict sense and the effect of the arrangement made is tovary the terms of a contract under seal by one of less value ; and (2.) that the arrangement made between the plaintiffs and thedefendants in January, 1940, was one which fell within the abovecategory and, accordingly, that the agreement for the reductionof the ground rent was binding on the plaintiff company, but thatit only remained operative so long as the conditions giving rise to itcontinued to exist and that on their ceasing to do so in 1945 the plaintiffs were entitled to recover the ground rent claimed at therate reserved by the lease.

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Central London Property Ltd v High Trees House Ltd 1947

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When considering promissory estoppel it is no longer inequitable if there is no detriment created, as it was given notice early enough

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The Post Chaser 1981

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If a debtor offers to pay part only of the amount he owes the creditor voluntarily accepts that offer, and in reliance on the creditors acceptance the debtor pays that part of the amount he owes in full, the creditor will, by virtue of the doctrine of promissory estoppel, be bound to accept that sum in full and final satisfaction of the whole debt. Arden LJ

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Collier v P n MJ Wright (Holdings) Ltd 2007 EWCA

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Sometimes it may be inequitable for an agreed promise to be respected, for example if it was done in an exploitative way

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DnC Builders v Rees 1966

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Promissory estoppel can only be used as a shield, and part of the restriction is the lack of consideration if it were used in such a way

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Combe v Combe 1951

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In Australia in some circumstances it is recognised that promissory estoppel can in certain circumstances be used as a 'sword'

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Walton Stores (interstate) Ltd v Maher 1987

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It is trite law that, although no contract can be made without any intention to be legally bound, that intention has to be ascertained objectively, not by looking into the parties' minds. Longer LJ

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Maple Leaf Macro Volability Master Fund v Rouvroy 2009

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The common law does not regulate the form of agreements between spouses. Their promises are not sealed with seals and sealing wax. The consideration that really obtains for them is the natural love and affection which counts for so little in theses cold courts... In respect of these promises each house is a domain into which the King;s writ does not seek to run, and to which his officers do not seek to be admitted.

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Balfour v Balfour 1919

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since the parties hadseparated the agreement regarding the ownership of thematrimonial home was one which was intended to createlegal relations and was binding upon them.

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Merritt v Merritt 1970

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Promises made within a family such as allowing a family member to stay in a house indefinitely, does not create legal relations unless further specified.

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Jones v Padavatton 1969

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on the basis that the plaintiffs intended tocreate a legal obligation to supply the coins, the considerationfor the entry into that contract was the entry by the motoristinto a contract to buy a certain quantity of petrol and accord-ingly there was no contract to transfer the coins " for a money consideration " within section 1 of the Sale of Goods Act 1893, ^so that the coins were not produced for sale within Group 25of Schedule 1 to the Purchase Tax Act 1963 and did notattract tax.

A commercial contract generally implies that there is an intention to create a legal relationship.

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Esso Petroleum Ltd v Commissioners of Customs and Excise 1976

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Even in a commercial situation there has to be some kind of promise, as a commercial situation does not automatically make it enforceable.

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Baird Textile Holding Ltd v Marks and Spencer Plc 2001

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The original case outlining the possibility of category 1 common mistake that nullifies consent, however it was unclear to the reason that it was decided and therefore is of limited use in the application of the idea of mistake.

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Couturier v Hastie[1856] 5 HLC 673

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If there is a written or implied warranty for a set of circumstances then the common mistake to the circumstances do not nullify the contract. This is because although there is a common mistake, a party has provided an implied guarantee that the circumstances exist.

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McRae v CommonwealthDisposals Commission (1950) 84 C.L.R. 377 (Australian High Court)

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What is required is a mistake “as to the existence of some quality whichmakes the thing without the quality essentiallydifferent from the thing as it was believed to be” Lord Atkin

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Bell v LeverBros [1932] AC 161

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Implied assumpit operates whereupon a man asked by a friend to complete a favour for him, and then reward at such a request when it comes after could've been implied by the task.

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Lampleigh v Braithwaite 1619

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If the contract specifies that it is not legally enforceable then there is obviously no intention to create legal relations no matter how commercial the operation is

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Rose and Frank Co v JR Crompton and Bros Ltd 1925