Commercial Law Revision Notes

Topics: Contract, Contract law, Sale of Goods Act 1979 Pages: 20 (3987 words) Published: June 10, 2012

Contract = an agreement between two or more persons which will be enforced by a court of law *Action for breach of contract is part of common (judge-made) law *Essence of contract law is to protect the bargain bw 2 parties *Must not engage in conduct that is misleading, unconscionable and unfair.

1. Formal contracts
Contracts of record (court records)
Contracts under seal (ie deeds, gratuitous comments)
2. Simple contracts
In writing
Evidenced in writing
No requirements


Offer - an offer must be made
Acceptance - offer must be accepted
Intention - the parties must intend to contract
Consideration - must be provided.

termination of a contract - available for serious breaches
damages - innocent party gets monetary compensation for the loss of contractual benefits specific performance - party required to honour contractual obligations injunction - order by court requiring a person to stop doing something recovery of contract price -

agreed damages clauses - contract itself makes provision for damages to be paid in the case of breach.

OFFER (p164)
An offer exists where a reasonable person would conclude from the facts that the person was willing for their promise to be binding in law. it is a question of intention.
Offerror - makes offer to the - offeree.

Must be:
intention or willingness to be bound
a firm promise
communication of the offer - writing, oral, by conduct

Distinguish offer from:
1. A Question
Harvey v Facey [1893] (p164 text)
Facey: merely a statement of future possibility - Facey answering Harvey's qu. court concluded - not offer
2. An Invitation to Treat
retail pricing, advertising, auctions and tenders.
Partridge v Crittenden [1968] - advertisement
Partridge advertised 'bramblefinch for sale 25c'
court concluded - not offer - merely ITT
Fisher v Bell [1960]
on display with price attached
court concluded - not offer merely ITT.
Grainger & Sons v Gough [1896]
was catalogue an offer?
court concluded - not offer merely ITT
Carlill v Carbolic Smoke Ball Co [1893]
Carlill won because of '1000 deposited'
advertisement was an offer not ITT or puff
3. Mere puff
adverising strategies
Leonard v PepsiCo
not an offer just mere puff
Carlill v Carbolic Smoke Ball Co [1983]
was an offer not mere puff
4. indication of future conduct
Harris v Nickerson [1973]
not an offer but indication of future conduct
5. Counter offer
Hyde v Wrench [1840]
not an offer - an offer once rejected cannot be accepted.

Offer can now be:
revoked or withdrawn by offerer
rejected by offeree
accepted by offeree
lapse on passing of reasonable time

- once offer has been accepted it cannot be revoked
- may be revoked any time before acceptance
Routledge v Grant [1928]
- revocation must be communicated to the offeree - otherwise ineffective Bryne v Van Tienhoven [1880]
2not communicated
- communication of revocation may be via a reasonably reliable 3rd party. Dickenson v Dodds
- revocation not possible where an option exists
Goldsborough mort & co ltd v Quinn [1910]

Hyde v Wrench [1840]
Counter offer for a property cancelled original offer

- Only the offeree may accept
- Acceptance must be final and unqualified
Masters v Cameron [1954]
court concluded that arrangement made 'subject to contract' was not binding - no acceptance - Problem of the battle of the forms (182)
two parties fire documents at each other containing different terms Butler machine tool co ltd v ex-cell-o corp (england) ltd [1979] - Acceptance must be communicated to the offeror
Felthouse v Bindley [1862]
Contract not made until acceptance has been communicated to the offeror Tallerman & Co Pty Ltd v Nathans Merchandise [1957]

Actual comm not necessary...
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