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Termination of Contract

Termination of Contract

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Published by YANZHU

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Published by: YANZHU on Nov 08, 2008
Copyright:Attribution Non-commercial


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Formation of contract
1 Is offer madeD showed intention to makecontractCarlill v CarbolicMere information or invitation totradeHarvey v Facey2 Is the offer effectively revokedOffer can not be revoked afteacceptanceByrne & Co v VanRevoke offer anytime beforeacceptanceRoutledge v Grant3 RejectedOffer is rejected (Counter offer)Hyde v Wrench
1 Unconditional2 Communicated (Postal rule)Effective as soon as postedEven if lost or never deliveredNot applicable for instantaneouscommunicationUnconditional but requiring further informationStevenson v McleanPostal ruleConditionalMasters v CameronPostal rule is not applicable if  particular mean of acceptance ismentioned
Have value but need not to beadequate Not previously givenPromise to perform existingobligationThomas v ThomasEarly payment of debt isconsiderationPinnel’s caseRoscorla v ThomasStilk v Myrick  No consideration for contract (Bymerely paying the debt owed)Foakes v Beer ExceptionsDeed or sealEquitable promissory estoppel
Intention to create legalrelationship
Social and domesticEasily rebuttedCommercialEasily rebutted especially whenthe contract is essential betweentwo businesses (Merritt v Merritt)Hard to rebutPresumed not legally bindingBalfour v Balfour Rebutted by express clear words
Hard to rebutEdwards v Skyways LtdRose v Fran
Express terms of contract
IssuesPDSigned written contract
1 A party who signed contract istaken to have read, understand andagreed to be bound by all of itsterms even if the party actually didnot read (Exceptions: Documentdoes not appear to be a contract/Terms have been misrepresented)2 Parole evidence (If the writtenterm is complete, other statementscan not vary those written terms)Exceptions: Not complete/ Secondcollateral contract No contract madeD J Hill and Co v Walter H WrightL’Estrange v Graucob Ltd
Written statement andunsigned written contract
1 Party is aware of the contractterms2 Prior sufficient notice must begiven (Nature of thedocument/Nature of thetransaction/Nature of the clause)3 Must not be misrepresentedD is aware of the contract termBalmain New Ferry v Robertson Notice is given too lateOlley v Marlborough No prior sufficient notice is givenInterfoto Picture Library v StilettoVisual ProgrammesD is not aware of the term and nosufficient notice is given prior tomaking the contract
Oral statement and writtencontract
Reasonable bystander testTime between statement andYes. Oral statement is thecontractual term. Negate P’s argument. Oralstatement is already after contract
contract Nature of statement: importance, promissory, unqualified. (Whether to be intended to rely on)Party making the contract hasspecial knowledge.Van Den Esschert v ChappellTime is immediately before.P would not sign the contractwithout assurance of DD has special knowledge about the propertymade. No intention to rely on.D does not have special knowledgeabout the statement.
Oral statement and oralcontract
Reasonable bystander testSame argumentSame argumentOscar Chess Ltd v Williams
Collateral contract
Consideration is entering the maincontract1 Statement is intended to be reliedon.2 Statement is not inconsistent withmain contractIntended to be relied on and notinconsistent with main contract.De Lassalle v Guildford Not intended to be relied on.JJ Savage and Sons v BlakeneyInconsistent with main contractHoyts Pty Ltd v Spencer 
Exemption clause
Is exemption clause a term of thecontractDoes exemption clause apply to theclaimExemption clause overruled by astatute (TPA 68)Exemption clause ismisrepresented and thus void.Curtis chemical cleaning v DyeingContra proferentem ruleAny ambiguity arisen must beinterpreted against the party whodrafted it.Alex Kay Pl v Gen Motors AcceptCorpFour cornersClause can not exempt a liabilitythat arises outside the terms of thecontract.Sydney Corporation v WestExempt liability for breach of afundamental term or obligation.Photo Production v Securicor Transport

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