ACCA F4

A selection of popular cases

CONTRACT
Offer and acceptance
Case Reminder Point of law
Partridge v Crittenden Advert selling wild birds Advert is an ITT not an offer
Carlill v Carbolic Smoke
Ball Co
Newspaper ad Use smoke ball,
catc fl!, get "#$$
Advert ma% be on offer to te
world &rarel%'
(iser v Bell (lick knife in sop window Sop displa% an ITT not an offer)
Parmace!tical Societ%
of *B v Boots
+edicines on sop selves ,ispla% is an ITT) Point of sale is
at co!nter
-arve% v (ace% .owest price for B!mper -all Pen
"/$$0
S!ppl% of information re selling
price is not an offer
-arris v Nickerson A!ction cancelled 1 s!ed for
e2penses
Advert re a!ction was ITT to an
offer 1 ence no contract
3rrington v 3rrington (ater bo!gt o!se for co!ple)
Promised to transfer if te% paid
mortgage) 4idow ref!sed
Unilateral offer co!ld not be
revoked wile consideration was
e2ec!tor%
-%de v 4renc Sale of farm 1 b!%er tried to get
price red!ction
Co!nter offer revokes original offer
(elto!se v Bindle% Tr%ing to b!% a orse) Ass!me it5s
mine if I don5t ear from %o!0
Silence cannot be acceptance
3ntores v +iles (ar
3astern
Acceptance fa2ed from Amsterdam
to .ondon
6alid wen received and read in
.ondon
B%rne v 6an Tienoven Acceptance and revocation letters
crossing in post
7evocation of offer onl% effective
wen received and read)
Acceptance valid wen posted)
Consideration
Case Reminder Point of law
7e +cArdle Tenant decorating o!se Past consideration is no good
Collins v *odefro% 4itness promised mone% to give
evidence 1 alread% s!bpoena5d
No consideration 1 promise was
alread% legal obligation
*lasbrook Broters v
*lamorgan CC
Police re8!ested to s!bd!e
picketing strikers
Police ad done more tan normal
obligation 1 consideration was
s!pplied
Stilk v +%rick Sailors m!tinied 1 oters offered a
rise to sta%
No consideration 1 rise was not
enforceable
-artle% v Ponsonb% +ore sailors m!tinied 1 oters
offered a rise to sta%
32tra d!ties were consideration 1
rise was enforceable
4illiams v 7offe%
Broters
S!b9contractor offered a bon!s to
finis on time
Avoidance of penalt% for te main
contractor was consideration for te
bon!s
(oakes v Beer .ender agreed dela%ed repa%ment
sced!le wit no interest
No consideration for variation of
contract) Interest was d!e
Central .ondon Propert%
Tr!st v -ig Trees
-o!se
.andlord offered to red!ce rent on
ig rise flats in 44:
Promissor% estoppel) 6ariation
freel% offered wit no coercion 1
co!ld not go back on offer
Intention
Balfo!r v Balfo!r -!sband went to Ce%lon 1
promised to s!pport wife
,omestic agreement 1 pres!med no
intention to create legal relations
;ones v 6ernon Pools Contract binding in ono!r onl%0 Pres!mption in commercial
contracts is tat legal relations are
intended 1 b!t it can be reb!tted)
Contract terms and exclusion clauses
Po!ssard v Spiers <
Pond
=pera singer ill at start of r!n)
Prod!cers p!t in replacement
(ailing to attend was breac of
condition 1 gave rigt to rescind
Bettini v *%e =pera singer > da%s late for
reearsals
Attendance at all reearsals was a
warrant% 1 breac gives rigt to
damages, not rescission
C!rtis v Cemical
Cleaning Co
3mplo%ee said e2cl!sion cla!se
onl% applied to beads and se8!ins
+isrepresentation rendered te
e2cl!sion invalid
Tompson v .+S
7ailwa%
7ail ticket referred to standard
conditions) Te% e2cl!ded liabilit%
for ever%ting) Train too long for
platform 1 woman fell off
32cl!sion cla!se was ade8!atel%
comm!nicated
=lle% v +arlboro!g
Co!rt
Notice in otel bedroom denied
liabilit% for loss
Not effective 1 comm!nicated after
contract was made
Poto Prod!ctions v
Sec!ricor
Sec!ricor nigt watcman set fire to
b!ilding
32cl!sion cla!se was effective
Misrepresentation
.eaf v International
*aller%
Sale of fake Constable +istake was not operative)
+isrepresentation was innocent so
rescission was onl% possible
remed%) Sale was ? %ears ago 1 too
late 1 dela% defeats e8!it%
Performance
C!tter v Powell Sailor died part wa% into @o!rne%)
Captain ref!sed to pa% wages
No wages d!e 1 part performance is
no good
S!mpter v -edges -o!se part b!ilt) B!ilder went b!st)
Asked for 8!ant!m mer!it
No amo!nt pa%able for b!ilding)
Acceptance co!ld not be freel%
given)
-oenig v Isaacs -o!se ref!rb largel% completed b!t
not e2actl% to spec) -omeowner
ref!sed to pa%
-ad to pa% as performance
s!bstantiall% completed) Co!ld
ded!ct cost to finis to spec
Discharge ! reach
S!mpter v -edges B!ilder alf b!ilt o!se) Asked for
part of price
No 8!ant!m mer!it as c!stomer
ad no coice abo!t accepting
-ocster v de la To!r To!r co!rier cancelled trip well in
advance)
Immediate action for anticipator%
breac was allowed
4ite and Carter
&Co!ncils' v +c*regor
Names on bins) Client cancelled
order before work done
In@!red part% can carr% on
regardless and s!e for f!ll price
Aver% v Bowden Sipping contract cancelled in
advance) 4ronged part% opted to
contin!e and s!e for f!ll price) 4ar
broke o!t
4ar fr!strated contract) .ost rigt
to s!e
=mni!m ,53nterprise v
S!terland
Sip cartered o!t ten sold before
start of carter
Anticipator% breac 9 not
fr!stration) Te events were
avoidable b% te owner
Remedies for reach of contract
Case Reminder Point of law
-adle% v Ba2endale Broken mill saft) ,ela% in fi2ing
lead to great loss of b!siness
7emoteness of damage 1 not
foreseeable 1 co!ldn5t s!e)
6ictoria .a!ndr% v
Newman Ind!stries
,ela% in completing contract led to
!ge cost from lost b!siness
=nl% liable for reasonabl%
foreseeable damages
Caplin v -icks Bea!t% contestant wrongl%
e2cl!ded from contest
,iffic!lt to assess damages b!t
plaintiff still entitled
Cell!lose Acetate Silk v
4idnes (o!ndr%
.oss m!c bigger tan contract
allowed for
,amages fi2ed at level proscribed
in contract)
(ord +otor Co v
Armstrong
Contract proscribed fi2ed damages
for trivial breaces
Penalt% cla!ses not !peld) =nl%
s!e for act!al loss
;arvis v Swan To!rs -olida% not as good as described in
broc!re
Co!ld s!e for disappointment and
distress
4arner Bros v Nelson Contract stopped Bette ,avis
working for oter film companies
In@!nction ill!stration
A"#NC$
4attea! v (enwick P!b manager ordered cigars despite
specific orders not to) P!b owner
ref!sed to pa%
Implied agenc%) =wner bo!nd on
contract)
*N7 v Swaffield .onel%, !naccompanied orse in
station) *N7 arranged stabling)
=wner ref!sed to pa%
Agenc% b% necessit%) =wner ad to
pa%)
Aelner v Ba2ter Promoters bo!gt wine on bealf
of compan% not %et formed)
Compan% not liable on contract as
did not e2ist wen contract made)
Promoters personall% liable
Bonge v To%nbee Solicitors acted for client wo ad
gone insane)
Insanit% ended agenc%) Solicitors
liable for breac of warrant% of
a!torit%)
TORT
,onog!e v Stevenson ,ecomposed snail in ginger beer)
*reat !pset after drinking
,!t% of care despite no contract)
Case establised negligence)
Bo!rill v Bo!ng 4oman eard cras 1 looked o!t at
mess% accident 9 miscarried
No d!t% of careC too remote)
-edle% B%rne v -eller Ad agenc% gets positive reference
from banker of potential client)
Client ten goes b!st owing mone%
Negligent mis9statement) .iable if
reasonabl% e2pect oters to rel% on
%o!r statement
Caparo Inds v ,ickman Caparo took over (idelit% rel%ing
on info in a!dited acco!nts) Tese
t!rned o!t to be in error
A!ditors normall% onl% liable to
tose to wom teir opinion is
directl% comm!nicated)
-ale% v .3B Blind person falling down marked
ole in road
.3B negligent) +!st take into
acco!nt potential s!sceptibilit%)
4att v -erts CC (ireman in@!red wile dasing off
to blaDe)
.ess care re8!ired if !rgent
ob@ective) A!torit% not liable
Paris v Stepne% BC =ne e%ed mecanic 1 no goggles
s!pplied) Blinded b% freak sard)
3mplo%er liable) +ore care
re8!ired given potential serio!sness
Bolton v Stone (reak cricket sot it ball o!t of
gro!nd in@!ring passer b%)
Cl!b not liable) -igl% !nlikel%
accident)
A,T v Binder -aml%n Partner gave verbal ass!rance to
b!%er tat acco!nts were =A)
Bo!gt and lost mone%)
(irm liable for negligent mis9
statement d!e to direct comment)
ICI v Satwell 32plosive broters) 4illingl%
pla%ing wit e2plosives 1 blown !p
6olenti non fit in@!ria) 3mplo%er
not liable)
#MP%O$M#NT
Pepper v -art Teacer sent cild to scool at
red!ced fee) 7even!e tried to
assess benefit at average cost
Cost0 in legislation interpreted as
average cost) -o!se of .ords !sed
-ansard to elp
-all v .orimer 6ision mi2er worked for man%
emplo%ers for sort time
Self emplo%ed
COMPAN$
Salomon v Salomon Compan% financed b% owner
mainl% b% sec!red debt) Compan%
insolvent) =wner claimed sec!rit%
Allowed) Compan% separate legal
person) Sareolder co!ld also be
sec!red creditor
,-N (ood ,istrib!tors
v Tower -amlets
*ro!p compan% traded from
premises owned b% oter gro!p
compan%) Comp!lsoril%
demolised
Compensation pa%able bot for
b!ilding and loss of trade) 4ole
gro!p viewed as owner
*ilford +otor Co v
-orne
+ecanic5s contract banned
approaces to old c!stomers after
leaving @ob) 4rote o!t from new
limited compan% instead
Not allowed) Compan% a sam0
merel% to avoid contract obligation
,aimler v Continental
T%re and 7!bber
#/#E contract between : Britis
companies 1 one wit *erman
sareolders) 3nglis compan%
witdrew
No breac) 6eil lifted to reveal oter
compan% as enem%
3braimi v 4estbo!rne
*alleries
: sareolders &E$F' e2pelled
oter sareolder as director
Co!rt agreed @!st and e8!itable
winding !p as 8!asi partnersip
-ickman v Aent
Seepbreeders
Articles said disp!tes m!st go to
arbitration) Sareolder s!ed
compan% over disp!te
Articles binding on sareolder) -ad
to go to arbitration
Pender v .!sington Articles allowed # vote per sare
!p to ma2 of #$$) .arge older
passed some sares to nominee)
Cairman wo!ldn5t co!nt votes
Articles binding on compan%) -ad to
co!nt votes
7a%field v -ands Articles said tat selling
sareolders m!st offer to directors
wo wo!ld b!% at fair price)
Articles binding sareolder v
sareolder) ,irectors obliged to b!%
3le% v Positive .ife Articles said 3le% Co solicitor for
life0) Sacked) S!ed for breac
Articles don5t make contracts
between compan% and >
rd
part%)
Co!ld not s!e
7e New Britis Iron Articles stated directors to be paid
"#,$$$pa) Not paid
Articles can be !sed to fles o!t
e2isting contract) "#,$$$ binding
,afen Tinplate v .lanelli
Steel
Proposed cange of articles to
allow directors to b!% o!t an%
sareolder
Not allowed) Not for benefit for
compan% as wole
Sidebottom v Aersaw
.eese
Proposed cange of articles to
allow directors to b!% o!t an%
sareolder competing wit co
Allowed) Alto!g bad for #
sareolder, wo!ld benefit co as a
wole
B!sell v (ait > e8!al sareolder G directors)
Articles said attacked director got
treble votes) : tried to sack >
rd
Co!ldn5t sack im) An% vote wo!ld
fail :H>
(reeman < .ock%er v
B!ck!rst Park
,irector described imself as +,)
+ade contract) Co ref!sed to pa%)
,irector eld o!t as +, as
apparent a!torit% to bind co) Co
m!st pa%)
Panorama ,evelopments
v (idelis (!rnisings
Co secretar% ired cars claiming for
co !se) Used tem personall%) Co
ref!sed to pa%
Secretar% as apparent a!torit% to
bind co in admin contracts) Co ad
to pa%)
,orcester (inance v
Stebbing
32perienced acco!ntant G director
signed blank ce8!es) Colleag!e
stole large s!m)
.iable for breac of d!t% to !se
skill and care) Acco!ntant so!ld
ave known better)
Percival v 4rigt Sareolder selling) ,irectors
bo!gt knowing sare price wo!ld
rise soon
,irectors =A) ,!t% owed to co as
wole not to individ!al
sareolders
(oss v -arbottle +inorit% sareolders bringing
action against director G ma@orit%
sareolder wo defra!ded co
Te% failed) If wrong is done to a
co, te proper plaintiff is te co