Contract Formation

Question 1

What are implied terms?

Answer 1

Court looks at circumstances of contract formation to determine if terms were implied.

Question 2

Wood v. Lucy, Duff-Gordon

Answer 2

Lucy gave exclusive sales contract with Wood. Wood did not attempt to sell. Implied term existed to make reasonable efforts to sell. Contract was thus valid.

Question 3

What is an Illusory promise?

Answer 3

Illusory promise is a non-promise because it is conditioned on that individuals later agreement. Ex I promise to do X but only if I want to.

Question 4

What is the pre-existing duty rule?

Answer 4

Generally, courts find there to be no consideration where there is a pre-existing duty to perform.

Question 5

When can an existing contract be modified due to an unanticipated event?

Answer 5

1. Must be modified before either side fully performs original contractual duties.
2. Circumstances must be unanticipated by parties.
3. Must be fair and equitable.

Example: Angel v. Murray. Garbage collector able to request additional $$$ due to unprecidented growth in residents.

Question 6

What is the mirror image rule?

Answer 6

Acceptance only if you accept under the same terms as the offer.