CONTRACT?

Is there an AGREEMENT between the parties?

Yes

No

Is the agreement CERTAIN in all material aspects?

Yes

No

No agreement, no contract

Is the agreement vague or ambiguous?

Yes

No

Can the uncertain elements be severed from the contract?

Yes

No

Does the agreement make performance of the contract discretionary?

Yes

No

The agreement is not certain in all material aspects

Is the agreement incomplete?

Yes

No

What are the intentions of both parties?

Remainder of the contract is enforceable

No certainty, agreement is not binding, no contract

Biotechnology v Pace (1988) 15 NSWLR 130

The agreement is ILLUSORY

The agreement is not vague or ambiguous

Does the agreement deal with all the essential terms?

Yes

No

The agreement is not certain in all material aspects

Is the agreement an agreement to agree/negotiate?

Yes

No

Life Insurance v Phillips

The agreement is vague or ambiguous

Godecke v Kirwan (1973) 129 CLR 629

The agreement is not incomplete

The agreement is incomplete

Agreement to reach agreement in the future?

Yes

No

The agreement is certain in all material aspects

Not binding

Agreement to enter negotiations in the future?

Yes

No

Possibly binding

Lockout agreement?

Yes

No

Coal Cliffs Collieries (1991)

Binding

Not binding