Contract Law, Workshops 1 & 2, Case Quiz

1.

Goods on display are an invitation to treat

Explanation
not an offer!

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1

2.

Display of dangerous or toxic items in window is an invitation to treat.

Explanation
The shop has a right to refuse sale.

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3.

Advertisements are an invitation to treat

Explanation
The case of Partridge v Crittenden established that advertisements are considered an invitation to treat rather than an offer. In this case, the defendant placed an advertisement for the sale of bramblefinch cocks and hens. The plaintiff responded to the ad, but the defendant argued that it was not a binding offer. The court ruled in favor of the defendant, stating that advertisements are merely an invitation for customers to make an offer, and the seller has the discretion to accept or reject the offers. Therefore, the correct answer is Partridge v Crittenden.

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4.

Advertisement of reward is regarded as an offer.

Explanation
Motive for acceptance is irrelevant.

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5.

If wording is explicit, advertisement can be regarded as an offer.

Explanation
This is the case for establishing a unilateral contract - a promise in return for an act.

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6.

An auction 'without reserve' means a promise to sell to the highest bidder, regardless of the value of the offer

Explanation
This is another example of a unilateral contract

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7.

Promises to keep an offer open are not binding.

Explanation
Exception is when consideration is given to keep the offer open.

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8.

Offers can be withdrawn at any time before acceptance, except when consideration is given to keep the offer open

Explanation
This is the exception to Routledge

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9.

Notice of revocation sent during normal office hours is considered valid on day of receipt

Explanation
regardless if it has been read or not (which would be seen by the court as an oversight). However, there is no universal rule on this.

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10.

Revocation can be communicated by reliable third party

Explanation
In the case of Dickinson v Dodds, the court held that revocation of an offer can be communicated by a reliable third party. This means that the offeror can revoke their offer through someone else, as long as that person is trustworthy and reliable. In this case, Dodds communicated the revocation of his offer to Dickinson through a reliable third party. This decision establishes that revocation does not necessarily have to be communicated directly by the offeror, but can be done through an intermediary.

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11.

An acceptance must match exactly the terms of an offer, otherwise there can be no contract. Counter offer destroys the original offer

Explanation
In the case of Hyde v Wrench, it was established that for a contract to be formed, the acceptance must be an exact match of the terms of the offer. If there are any differences or changes made in the acceptance, it is considered a counter offer and it destroys the original offer. This means that the original offer is no longer valid and cannot be accepted. Therefore, the answer refers to the principle established in Hyde v Wrench that a counter offer destroys the original offer.

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12.

In order to claim an offer, you must have knowledge of it.

Explanation
You cannot deliver a missing dog, walk away then later discover there was a reward which you could have claimed had you known.

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13.

When there is doubt as to whether a statement is an offer or not, there is an objective test

Explanation
Would the reasonable person regard the statement as an offer?

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14.

Revocation is not effective until it is communicated

Explanation
This answer refers to the case of Byrne v Tienhoven, specifically the decision made by the court in relation to revocation. According to this case, revocation is not considered effective until it has been communicated. This means that if someone wants to revoke an offer or agreement, they must inform the other party involved for the revocation to be valid. The case of Byrne v Tienhoven established this principle, highlighting the importance of communication in revocation.

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15.

If you make a request for information, this does not affect your right to accept the existing offer

Explanation
Stevenson v McLean is a legal case that established the principle that making a request for information does not affect one's right to accept an existing offer. In this case, the court ruled that a request for information made by the offeree did not constitute a counteroffer, but rather a mere inquiry that did not impact the original offer. Therefore, the offeree still had the right to accept the offer even after making the request for information. This ruling ensures that individuals can seek clarification or additional details without jeopardizing their ability to accept the offer.

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16.

Acceptance must be communicated, and is effective when and where it is received

Explanation
This answer refers to the case of Entores v Miles Far East Corp. In this case, the court ruled that acceptance of an offer must be communicated to the offeror in order for it to be effective. Furthermore, the acceptance is considered effective when and where it is received by the offeror. This means that if the acceptance is not properly communicated or if it is not received by the offeror, it may not be considered valid. This principle ensures that both parties are aware of the acceptance and prevents any misunderstandings or disputes regarding the acceptance of an offer.

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17.

The postal rule may apply even if the letter of acceptance is lost or delayed in the post

Explanation
The case of Household Fire and Carriage Accident Insurance v Grant established the principle that the postal rule can still apply even if the letter of acceptance is lost or delayed in the post. In this case, the court held that the acceptance of an insurance proposal was effective upon posting, even though the insurance company never received the letter. This means that the contract was formed at the moment the letter was posted, regardless of whether it reached its intended recipient. This case is significant in contract law as it recognizes the postal rule as a valid means of acceptance, providing certainty and protection for parties involved in postal transactions.

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18.

Consideration need not be adequate, but must be sufficient

19.

A conditional gift is

A.

A contract of sale
B.

A condition required to trigger promisor's generosity
C.

An example of blackmail

Correct Answer
B. A condition required to trigger promisor's generosity

Explanation
A conditional gift refers to a gift that is given with the requirement that a certain condition must be met in order for the gift to be received. This condition acts as a trigger for the generosity of the person giving the gift. In other words, the giver expects something specific to happen or a certain action to be taken before the gift can be claimed. This distinguishes it from a contract of sale, where there is an exchange of goods or services for a price, and from blackmail, which involves threatening someone to obtain something of value.

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20.

Consideration does not need to have economic value

Correct Answer
Chappell and Co Ltd v Nestlé Co Ltd
Chappell

Explanation
famously, it can be food wrappers or a peppercorn

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21.

The exceptions to [Roscorla v Thomas] are:

A.

Act must have been done at promisor's request [Lampleigh v Brathwait]
B.

Parties must have understood from outset that act would be rewarded [Re Casey's Patents, Stewart v Casey]
C.

When one of the parties witnesses a double rainbow
D.

The payment or conferment of other benefit must have been legally enforceable had it been promised in advance (usual requirement for binding contract)

Correct Answer(s)
A. Act must have been done at promisor's request [Lampleigh v Brathwait]
B. Parties must have understood from outset that act would be rewarded [Re Casey's Patents, Stewart v Casey]
D. The payment or conferment of other benefit must have been legally enforceable had it been promised in advance (usual requirement for binding contract)

Explanation
The exceptions to Roscorla v Thomas are that the act must have been done at the promisor's request (Lampleigh v Brathwait), the parties must have understood from the outset that the act would be rewarded (Re Casey's Patents, Stewart v Casey), and the payment or conferment of other benefit must have been legally enforceable had it been promised in advance (usual requirement for a binding contract).

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22.

If you are under a legal obligation to do something, and someone offers to pay you to undertake this obligation, but do not pay you, they are not obliged to.

Correct Answer(s)
Collins v Godefroy

Explanation
No consideration given.

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23.

Exceeding an existing legal duty - providing a service over and above what is reasonably necessary, counts as consideration

Correct Answer(s)
Glasbrook Bros Ltd v Glamorgan County Court
Glasbrook

Explanation
In the case of Glasbrook Bros Ltd v Glamorgan County Court, the court ruled that exceeding an existing legal duty by providing a service that goes beyond what is reasonably necessary can be considered as valid consideration. This means that if a party goes above and beyond their obligations and provides additional services, they can be entitled to receive something in return. The case of Glasbrook Bros Ltd v Glamorgan County Court established this principle and is cited as a precedent in similar cases.

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24.

Performing an existing contractual duty owed to the other party in exchange for a promise by the other party to pay more money is not consideration

Correct Answer(s)
Stilk v Myrick

Explanation
In the case of Stilk v Myrick, the court held that performing an existing contractual duty owed to the other party in exchange for a promise by the other party to pay more money is not considered valid consideration. This means that if a party is already obligated to perform a certain duty under a contract, they cannot demand additional payment for fulfilling that duty. Therefore, the answer to the question is that Stilk v Myrick established that such a situation does not qualify as consideration.

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25.

If you exceed contractual obligation (there is more benefit and/or detriment involved), it is valid consideration

Correct Answer(s)
Hartley v Ponsonby
Hartley

Explanation
In the case of Hartley v Ponsonby, the court ruled that if a party exceeds their contractual obligation and provides additional benefit or suffers additional detriment, it can be considered valid consideration. This means that if one party goes beyond what is required by the contract and provides extra value or incurs extra loss, it can be seen as a valid reason for the other party to fulfill their obligations under the contract. This ruling highlights the importance of considering the actions and intentions of the parties involved in determining the validity of consideration in a contract.

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26.

If a contract is agreed at a fixed price, then one party declines to continue work unless it is paid more, with the other party agreeing, it is considered economic duress.

Correct Answer(s)
Williams v Raffey Bros & Nicholls (Contractors) Ltd
Williams v Raffey Bros

Explanation
Where a promisor secures no benefit from performance of the contract by the other party, it will not be good consideration.

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27.

A debtor is bound to pay the full amount of an undisputed debt. Anything less, even if agreed, is not good consideration

Correct Answer(s)
Foakes v Beer

Explanation
In the case of Foakes v Beer, the court ruled that a debtor is obligated to pay the entire amount of a debt that is undisputed. Even if the debtor and creditor agree to accept a lesser amount as full payment, it is not considered valid consideration. This means that the debtor cannot use the agreement to argue that the debt is fully satisfied. The court's decision reinforces the principle that parties must uphold their contractual obligations, and any deviation from the agreed terms may not be legally enforceable.

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28.

Exception to rule in [Foakes v Beer], if debtor can show that he gave something different for the creditor's agreement to accept the lesser sum in settlement, then this shall be good consideration

Correct Answer(s)
Pinnel's Case

Explanation
Pinnel's Case is the correct answer because it is a landmark case in contract law that established the principle that payment of a lesser sum cannot be a satisfaction for a greater sum owed, unless there is additional consideration provided by the debtor. This exception to the rule was later reaffirmed in Foakes v Beer, where it was stated that if the debtor can prove that they gave something different in exchange for the creditor's agreement to accept the lesser sum in settlement, then this can be considered as good consideration.

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29.

Promissory Estoppel:Where a party to a contract forgoes a legal right by words or conduct through a promise

Correct Answer(s)
Central London Property Trust Ltd v High Trees House Ltd
High Trees

Explanation
Central London Property Trust Ltd v High Trees House Ltd, also known as the High Trees case, is a landmark legal case that established the principle of promissory estoppel. In this case, the Central London Property Trust agreed to reduce the rent for High Trees House during World War II due to a decrease in demand. However, after the war ended, the Trust sought to claim the full rent. The court held that the Trust was estopped from doing so because they had made a promise to accept reduced rent and High Trees House had relied on that promise. This case illustrates the concept of promissory estoppel, where a party is prevented from going back on their promise if the other party has relied on it to their detriment.

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30.

For promissory estoppel to succeed, it must be inequitable for the promisor to go back on his promise

Correct Answer(s)
D&C Builders v Rees
D&C Builders

Explanation
The case of D&C Builders v Rees is being referenced here to support the statement that for promissory estoppel to succeed, it must be inequitable for the promisor to go back on his promise. The case likely involves a situation where D&C Builders made a promise to Rees, and it would be considered unfair or unjust for D&C Builders to break that promise. The case provides an example or precedent to support the statement.

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31.

The postal rule will only apply if it is reasonable to use the post, the postal rule has not been excluded by the offeror and the letter has been properly posted.

Correct Answer(s)
Adams v Lindsell

Explanation
The case of Adams v Lindsell established the postal rule in contract law. According to this rule, an acceptance of an offer is effective as soon as it is posted, regardless of when the offeror receives it. However, for the postal rule to apply, certain conditions must be met. Firstly, it must be reasonable to use the post as a means of communication. Secondly, the offeror should not have explicitly excluded the postal rule in the offer. Lastly, the letter containing the acceptance must be properly posted. This means that it must be correctly addressed, stamped, and sent through the appropriate postal service.

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32.

The postal rule can be excluded expressly or by implication

Correct Answer(s)
Holwell Securities v Hughes

Explanation
For example, if the parties make it clear that acceptance will only by effective when *communicated* then the postal rule will not apply.

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33.

Past consideration is no consideration

Correct Answer(s)
Roscorla v Thomas
Roscorla

Explanation
In the case of Roscorla v Thomas, the court held that past consideration is not valid consideration for a contract. This means that if a promise is made after the act has already been performed, it cannot be enforced as a contract. In this case, Roscorla had bought a horse from Thomas, and after the sale was completed, Thomas promised that the horse was sound. However, when the horse turned out to be unsound, Roscorla sued Thomas for breach of contract. The court ruled that the promise made after the sale was past consideration and therefore not enforceable.

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34.

Existing contractual duty - if C depends on B delivering on the day to supply B's goods to D, and extra money is promised for delivery on promised date, the extra money is good consideration.

Correct Answer(s)
Scotson v Pegg

Explanation
In the case of Scotson v Pegg, the court ruled that if party C relies on party B to deliver goods to party D on a specific day, and party B promises to pay extra money for delivering the goods on the promised date, this promise of extra money constitutes valid consideration. This is because party C is already under an existing contractual duty to deliver the goods, and the promise of extra money provides an incentive for party B to fulfill their obligation on time. Therefore, the promise of extra money is considered good consideration in this scenario.

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35.

Promissory Estoppel is 'a shield not a sword'

Correct Answer(s)
Combe v Combe

Explanation
Combe v Combe is a legal case that established the principle of promissory estoppel. In this case, the court ruled that promissory estoppel is a "shield not a sword." This means that promissory estoppel can be used as a defense by a party who has relied on a promise made by another party, but it cannot be used as an offensive tool to enforce a promise. In other words, promissory estoppel can protect a party from being unfairly disadvantaged due to their reliance on a promise, but it cannot be used to force the other party to fulfill their promise.

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36.

There must be contractual intention. A presumption arises that a course of dealings is in a commercial context if between companies.

Correct Answer(s)
Edward v Skyways
Skyways