Biz Law Cheat Sheet

Topics: Contract, Contract law, Contractual term Pages: 9 (3144 words) Published: February 28, 2013
z LawVariation of contract
The issue here is whether the variation of the contract is valid. Generally, if the contract itself clearly allows for the variation, the variation will be binding. However, if the contract does not clearly provide for variations, for the variation to be valid, both parties must agree to the changes and the following must be present. EITHER Fresh consideration

If there is fresh consideration for the change or variation, the change or variation will be valid. This means that both parties get something in return for agreeing to the change. OR Seal or deed

If the variation is made by way of seal or deed, there is no further requirement that there must be fresh consideration and so the variation will be legally enforceable. OR Williams v Roffey Exception

The exception was established in the case of Williams v Roffey where the defendant sub-contracted carpentry works to the plaintiff. But after some time, the plaintiff honestly could not go ahead, as he was in financial difficulties. The defendants promised the plaintiff extra amounts if the work was completed on time, as if there was a delay, the defendants would be liable to the owners of the flats under their contract with the owners. However, not all extra payments were made and so the plaintiff sued the defendants and the court upheld the claim. Hence it would appear that if changes are made to the contract without dishonesty or fraud, and the party being sued has got a practical benefit or avoided a disbenefit, the changes may be upheld. OR Promissory estoppel

If a contracting party has made a clear and unambiguous promise to change a term in the contract and the other party has relied on the promise, and the court is of the view that it is very unfair or inequitable in the circumstances for the party making the promise to go back on his promise, he may be stopped from going back on his promise even if there is no fresh consideration. (High trees case)

The issue is whether “statement in issue” can amount to misrepresentation. EITHER Statement of opinions
To be actionable, the representation has to be a statement of existing fact or past event. If it were a statement of opinion, it would not be statement of existing fact or past event, and thus would not give rise to misrepresentation. IF IT IS AN OPINION: In Bisset v Wilkinson, the court held that since the maker was just giving his opinion and not stating a positive fact, there was no actionable misrepresentation. However, if in some exceptional situation, such as where it can be proved that the maker did not actually believe in the truth of the opinion or if it can be established that a reasonable man having the maker’s knowledge could not have honestly held such an opinion, an action for misrepresentation may lie. In Smith v Land and House Property Corpn, the court held that even though the vendor was just giving his opinion, he could not have honestly believed in the truth of the statement, and there was a misrepresentation. OR Statement of future intentions

Generally, statement of future intentions cannot give rise to misrepresentation. However, exceptionally if it can be established that the maker did not actually believe in the statement of future intention, an action for misrepresentation may lie. In Edgington v Fitzmaurice, the court held that as the company knew the statement of future intention was false, there was an actionable misrepresentation. OR “Puff” or “sales talk”

If the statement were not a statement of fact, but merely a “puff” or “sales talk”, an action for misrepresentation would not lie as a reasonable person would not have taken such statements seriously. OR Silence

Generally, keep quiet does not amount to a misrepresentation. However, exceptionally, silence may amount to misrepresentation in the following situation: * Half truth is offered
* If what the maker stated is true, but on considering the undisclosed facts on the...
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