lecture two Flashcards
(20 cards)
What is a Contract?
“An agreement between two or more persons (the parties) having the capacity to make it, in the form demanded by law, to perform, on one side or both, acts which are not trifling, impossible or illegal.”
(MacQueen and Thomson, para 1.10)
First Requirement for a Contract?
Agreement (Consensus in idem) — meeting of minds on the essential terms.
How is Agreement (Consensus) assessed?
Objectively — Would a reasonable person, looking at all actings, conclude agreement?
Muirhead and Turnbull v Dickson (1905): It’s about what people say/do, not hidden intentions.
case:%20Mathieson%20Gee%20Ltd%20v%20Quigley%20(1952)
No contract if offer and acceptance don’t match:
MG offered plant hire, Quigley accepted silt removal ➡️ No consensus in idem ➡️ No contract.
Essential Terms Required for Contract?
Depends on type of contract:
Parties identified (Fleming Buildings Ltd v Forrest [2010])
Sale: goods/land identified, price usually agreed. (Sale of Goods Act 1979, s.8 allows court to set price if needed)
Leases: property, rent, duration (and sometimes extras).
Bogie v Forestry Commission (2002)
No contract without precise identification of subjects — need clear agreement on essential terms.
Incomplete Agreements: Courts’ Approach?
➡️ Courts prefer to uphold contracts if possible.
Bogie (para 38): Prefer effective construction.
Avintair v Ryder Airlines (1994) and RTS Flexible Systems Ltd v Muller (2010): Missing economic terms don’t always defeat consensus.
Determining Consensus: Classic Analysis
✅ Offer + ✅ Acceptance = ✅ Contract
(Stair, Institutions, I.10.6)
What is an Offer?
➡️ “A statement of terms proposed as a basis of agreement.”
(15 Stair Memorial Encyclopedia, para 62)
Must be capable of forming binding obligations if accepted!
Key Features of an Offer
Must be communicated (Thomson v James [1855])
Definite person or to world (Fleming Buildings Ltd v Forrest [2010])
Unqualified acceptance leads to contract.
Revocation of an Offer
Can revoke anytime before acceptance (McMillan v Caldwell 1991).
Offer lapses: after expiry of time limit (Flaws case) or reasonable time (Glasgow Steam Shipping Co v Watson; Wylie v McElroy)
Non-Offers
(i) Unilateral promise
(ii) Replies to inquiries (Harvey v Facey [1893])
(iii) Recapping negotiation stance (Glasgow City Council v Smith [2015])
Invitation to Treat (ITT) Examples
Shop displays (Fisher v Bell [1961])
Supermarket shelves (Boots Cash Chemists [1953])
Auction invites, tenders
Advertisements (Fenwick case; but Carlill v Carbolic Smoke Ball Co can rebut)
Stair’s Theory on Will
Only engagement (not desire or resolution) creates obligations:
Offer is an engagement.
Online shopping example: A.D. Ward & P. Curk (2018 SLT article).
What is Acceptance?
➡️ “Final unqualified assent by the offeree to offer’s terms.”
(MacQueen and Thomson, para 2.35)
Must communicate acceptance clearly!
Communication of Acceptance
Silence usually ≠ acceptance (Higgins v Wilson [1848])
But context may show otherwise (Shaw v James Scott Builders [2010]).
Postal Rule for Acceptance
Acceptance effective when posted, not received (Jacobsen Sons v Underwood [1894])
Only applies to acceptance, not offers/counter-offers.
Scottish courts reluctant to extend rule (e.g., no fax).
Qualified Acceptance = Counter-Offer
“Yes, but…” → NOT acceptance!
➡️ Rejects original offer ➡️ New offer made
(Wolf & Wolf v Forfar Potato Co 1984)
Qualified Acceptance Case Law
Rutterford Ltd v Allied Breweries (1990)
Findlater v Maan (1990): Letters were separate offers, not referencing each other.
De Minimis Rule on Trivial Changes
De Minimis Rule on Trivial Changes
Minor wording changes might not kill an acceptance.
Erskine v Glendinning (1871): Minor addition ≠ counter-offer.
Stobo Ltd v Morrison’s (1949): Depends on context.
