Flashcards in Contract formation Deck (15):
What are the 3 types of contract?
Describe a void contract and why may a contract be void?
- no contract at all
- if it is illegal
Describe a voidable contract and why may a contract be voidable?
- can be set aside
- there is a lack of capacity
- lack of free will
- contract made due to misrepresentation
Describe an unenforceable contract and why may a contract be unenforceable?
- valid contract made, but cannot be enforced
- e.g. mistakes in contract
What are the main elements of a contract?
- agreement (offer and acceptance)
- intention to create legal relations
Describe what an offer is
- definite promise to be bound on specific terms
- made by an offeror to an offeree (can be one person, group of people, or the whole world)
What are not an offer?
- invitation to treat (an invitation to someone to make an offer)
- statement of intention
How long does an offer last?
Lasts until it is terminated by:
- lapsed over time
- failure of a pre-condition
Describe the forms of an acceptance
- unqualified agreement to all the terms on offer
- can be verbal, in writing or inferred by conduct
- offeror cannot dictate that silence will be acceptance
- acceptance must be communication unless the offeror dispenses with that requirement
Intention to create legal relations
- presumption based on type of relationship
- social/domestic - presume no intention
- commercial - presume intention
- presumption may be rebutted if clear evidence to the contrary
What is consideration?
What each party gives/agrees to give
What are types of good consideration?
- executed - act performed at time of agreement
- executory - promise to do something in the future
- sufficient not adequate - as long as it has value, does not matter if it is not equal
- forbearance of existing rights
What are types of not good consideration?
- past - already performed at time of agreement
- performance of an existing statutory duty - unless exceeded
- performance of existing contractual duty - unless exceeded or a new contract with a third party
What is the privity of a contract?
Only the parties to the contract can enforce/be sued under it