CE 4221 Civil Engineering Practices, Quality and Legislation

Tutorial 2: Contract Law

Paul decides he wants to buy a new car. He does his

research and decides he wants a Hyundai – the top
model.
He goes into a well respected dealer and describes the
model and details of the car he wants and asks the
salesman for his best price.
The salesman advises a price (drive-away) and Paul is
happy to accept it.
The salesman writes up the contract (all the details,
including price) and they both sign it. No deposit is paid
but full payment is required in 3 weeks when the car is
to be delivered.
Three weeks later, Paul arrives to pick up and pay for
his new car, whereupon the salesman tells him that he
has made a mistake and used the wrong price in his
quote and that this particular model will require Paul
to pay a further Rs. 50,000.

How would you advise Paul?

1
Paul and his Hyundai
Note : Paul did not pay a deposit at the time of signing
the “contract”
Does that mean that the contract is “invalid”? No
consideration?
Can the salesman change the contract price because
“he made a mistake”?
Q. What should Paul do?
A. Ring the owner of the car dealer and explain the
situation. Knowing the rules of contract, tell him “a
contract is a contract and it should be honoured.”
Fair Trading Act and Consumer Law also apply,
•The lesson: If you make a contractual error, you wear
the consequences.