Elements of The Law of Contract

Iementscfthe
Iawcfccntract
CatharineMacMiIIan
kichardStcne
2004
||b 2o50040
D|p|oao|r|ow 2o90040
Z
ur|.e|s|t,ol|orcor|\te|ro|||o|oaae
!||ssucjectu|cewosp|epo|eclo|t|eur|.e|s|t,ol|orcor|\te|ro|||o|oaaec,.
Cot|o||re|oc||||orb/(\|cto||o),||b(0ueers,Coroco),|||
(Cortoc),|ectu|e||r|ow,'c|oo|ol|ow,0ueer|o|,,ur|.e|s|t,ol
|orcor
orc
||c|o|c'tore,||b('otor),|||(|u||),bo|||ste|,||olesso|orc|eocol
Depo|taert,ur|.e|s|t,ol||rco|r.
.
Cot|o||re|oc||||orwosp||ao|||,|espors|c|elo|C|opte|s2,45,78,
04,orco7.||c|o|c'torewosp||ao|||,|espors|c|elo|C|opte|s3,
o,9,orc5.
!||s|soreolose||esolsucjectu|cespuc||s|ecc,t|eur|.e|s|t,.we|e|et
t|otow|rtop|essu|eolwo||t|eout|o|so|euroc|etoerte||rtoor,
co||esporcerce|e|ot|rto,o|o||s|rl|oa,t|eu|ce.
|l,ou|o.eor,coaaertsort||ssucjectu|ce,lo.ou|oc|eo|urlo.ou|oc|e,
p|eoseuset|elo|aott|ecoc|olt||su|ce.
Acknowledgements
||u|es2.orc5.|o.eceer|ep|ocucecc,||rcpe|a|ss|orolt|e
lo||ow|r.
||u|e2..|ttp.//www.co|co||csao|eco||co.coa
||u|e5.. Illustrated London News Picture Library.

||oto|op|sC.|oc||||or,2003
|uc||cot|ors0ll|ce
!|e|\te|ro|||o|oaae
ur|.e|s|t,ol|orcor
34!o.|stoc|'uo|e
|orcorwC|9|/
ur|tecK|rcoa
www.|orcore\te|ro|.oc.u|
|uc||s|ecc,t|eur|.e|s|t,ol|orcor||ess
ur|.e|s|t,ol|orcor2004
|||rtecc,Cert|o||||rt|r'e|.|ce,ur|.e|s|t,ol|orcor
Co.e|ces|rc,0ar|s|o|tre|s,C|osow
/|||||ts|ese|.ec.|opo|tolt||swo||ao,ce|ep|ocucec|ror,lo|a,o|
c,or,aeors,w|t|outpe|a|ss|or|rw||t|rl|oat|epuc||s|e|.
J
Couleuls
C|opte| |rt|ocuct|ororcere|o|p||rc|p|es 5
PartI kequirementsforthemakingofacontract 17
C|opte|2 0lle|orcocceptorce 9
C|opte|3 Cors|ce|ot|or 39
C|opte|4 0t|e|lo|aot|.e|eu||eaerts.|rtert|or,
ce|to|rt,orccoap|eteress 57
PartII Contentofacontractandregulationofterms 69
C|opte|5 !|ete|asolt|ecort|oct 7
C|opte|o !|e|eu|ot|orolt|ete|asolt|ecort|oct 89
PartIIIJhecapacitytocontractminors 111
C|opte|7 Cort|octsaocec,a|ro|s 3
PartIvvitiatingelementsintheformationofacontract 121
C|opte|8 ||sto|e 23
C|opte|9 ||s|ep|esertot|or 5
C|opte|0 Du|essorcurcue|rl|uerce o7
Partv whocanenforcethetermsofacontract? 181
C|opte| |||.|t,olcort|oct 83
PartvIIllegalityandpublicpolicy 203
C|opte|2 |||eo||t, 205
C|opte|3 |est|o|rtolt|oce 25
PartvIIJhedischargeofacontract 225
C|opte|4 |e|lo|aorceorcc|eoc| 227
C|opte|5 ||ust|ot|or 239
PartvIIIkemediesforbreachofcontract 255
C|opte|o Doaoes 257
C|opte|7 |u|toc|e|eaec|es 275
4
ur|.e|s|t, ol |orcor |\te|ro| ||o|oaae

Chapler l |ulroducliou aud geueral
priuciples
Ccntents
Intrcducticn 5
1.1 Studying the Iaw cf ccntract 6
1.2 keading 7
1.3 Methcd cf wcrking 11
1.4 Scme issues in the Iaw cf ccntract 12
1.5 FIan cf the subject guide 14
1.6 Fcrmat cf the examinaticn paper 14
Intrcducticn
Tlis subject guide is designed to lelp you to study tle Elements
oI the law oI contract in Englund und Wules. Tlis guide is not u
textbook und it must not be tuken us u substitute loi ieuding tle
texts, cuses, stututes und jouinuls ieleiied to in it. Tle puipose ol
tle guide is to tuke you tliougl eucl topic in tle syllubus loi
Elements oI the law oI contract loi tle LLB (Inteimediute
level) und tle Diplomu in Luw in u wuy wlicl will lelp you to
undeistund contiuct luw. Tle guide is intended to 'wiup uiound'
tle iecommended textbooks und cusebook. It piovides un outline ol
tle mujoi issues piesented in tlis subject. Eucl cluptei piesents
tle most impoitunt uspects ol tle topic und piovides guidunce us to
essentiul und luitlei ieuding. Eucl cluptei ulso piovides you witl
uctivities to test youi undeistunding ol tle topic und sell-
ussessment exeicises designed to ussist youi piogiess. Tleie uie
ulso sumple exuminution questions, witl uppiopiiute leedbuck,
wlicl will ussist you in youi exuminution piepuiution.
In tle study ol contiuct luw, it is essentiul to tiy to guin un
undeistunding ol tle piinciples ol luw wlut tle luw is tiying to do
in iesponse to puiticului issues iutlei tlun tle iote memoiisution
ol iules und cuses. Tlis meuns you muy need to ieud pussuges oi
clupteis in tle guide (und tle ielevunt suggested ieuding
muteiiuls) ovei seveiul times in oidei to undeistund tlese
piinciples ol luw.
We luve tuken uccount ol ull muteiiuls uvuiluble up to Febiuuiy,
2004.
||eaerts ol t|e |ow ol cort|oct

Learning cutccmes
b, t|e erc ol t||s sucject u|ce orc t|e |e|e.ort |eoc|r, ,ou s|ou|c ce oc|e to.
ceaorst|ote o t|o|ou| wo|||r |row|ece ol cort|oct |ow. t|e s,||ocus

o|as to |.e ,ou o ooc wo|||r |row|ece ol t|e e|eaerts ol cort|oct |ow
orc t|e t|eo|, urce||,|r |t
urce|storc t|e cose |ow. ,ou s|ou|c ce.e|op t|e oc|||t, to urce|storc
cort|oct coses, t|ot |s to so,, t|e |apo|torce ol t|e |ssues |r o cose orc |ow
t|e cou|t |os |eso|.ec t|e |ssues
opp|, t|e coses. ,ou s|ou|c ce oc|e to opp|, t|e cose |ow to o |.er |ssue
urce|storc stotutes. ,ou s|ou|c ce.e|op t|e oc|||t, to |rte|p|et o stotute. |r

occ|t|or, ,ou s|ou|c ce oc|e to urce|storc t|e |rte||e|ot|ors||p cetweer t|e
stotute orc t|e |e|e.ort coaaor |ow
opp|, t|e stotutes. ,ou s|ou|c ce oc|e to opp|, t|e stotutes to o |.er |ssue.
|oc| c|opte| ||sts spec|l|c |eo|r|r outcoaes to ce oc||e.ec |r |e|ot|or to t|e
aote||o| co.e|ec |r t|ot c|opte|.
1.1 Studying the Iaw cf ccntract
As ulieudy stuted, tlis guide is not u textbook. It must not be tuken
us u substitute loi ieuding tle texts, cuses, stututes und jouinuls. Its
puipose is to tuke you tliougl eucl topic in tle syllubus loi
Elements oI the law oI contract loi tle LLB (Inteimediute
level) und tle Diplomu in Luw in u wuy wlicl will lelp you to
undeistund contiuct luw. It piovides un outline ol tle mujoi issues
piesented in tlis subject. It will ulso lelp you piepuie to unswei
tle kind ol questions tle exuminution pupei is likely to contuin.
Note, lowevei, tlut no topic will necessuiily be included in uny
puiticului exuminution und tlut some uie moie likely to uppeui
tlun otleis. Tle Exumineis uie bound only by tle syllubus und not
by unytling suid in oi omitted liom tlis guide.
Wlut do we meun by 'tuking you tliougl' u topic? Veiy simply it is
to spell out wlut pioblems oi dilliculties tle luw is seeking to
piovide u solution loi und to give u stiuctuied guide to tle
muteiiuls textbooks, cuses und stututes. You must ieud tlese in
oidei to uppieciute low Englisl luw lus deult witl tle issues und
to judge low sutisluctoiy tle solutions uie in teims ol oveiull
policy.
How to use thls subject gulde
Tle uppioucl udopted by tlis guide is us lollows:
Eucl cluptei begins witl u geneiul intioduction to tle topic
coveied und tle leuining outcomes you slould uclieve witlin tlut
cluptei.
Following tlut, tle topic is divided into puiticului subsections. Eucl
subsection piovides u ieleience to tle iecommended ieudings in
McKendiick's textbook und Poole's cusebook. At u minimum, you
slould ieud tlese; you will piobubly lind tlut you need to ie-ieud
tlem in muny cuses. It is olten dillicult to giusp some legul
piinciples und most students lind tlut tley need to ie-upply
tlemselves to some topics.
C|opte| |rt|ocuct|or orc ere|o| p||rc|p|es

In uddition, ut tle end ol eucl cluptei, tleie uie iecommendutions
loi uselul luitlei ieudings. Tlis will ulwuys covei tle ielevunt
section in Anson`s ldw oj Conrrdcr. You will lind it desiiuble to
ieview tlis textbook liom time to time becuuse it is olten eusiei to
giusp u point wlen it is expluined in u dilleient luslion.
At tle end ol eucl subsection, tle leuining outcomes uie uguin
piovided to enuble you to test youi piogiess. Tliouglout eucl
cluptei, sell-ussessment questions und leuining uctivities uie
piovided. Feedbuck is ulso given witl ieguid to tle leuining
uctivities to ullow you to cleck youi compielension ol u puiticului
muttei. You will lind tlis piocess most lelplul il you unswei tle
question beloie you cleck tle leedbuck (iutlei tlun simply ieuding
tle question und tlen clecking tle leedbuck). Tlis is becuuse tle
object ol youi studies is to undeistund, iutlei tlun memoiise, tle
luw. At tle end ol eucl cluptei, some udvice is given witl ieguid to
possible exuminution questions on tlis topic. Tle luct tlut tlis
constitutes udvice ubout posslble exuminution questions cunnot
be stiessed enougl.
Tle ieusons loi studying tle piinciples ol tle luw ol contiuct uie
ieudily uppuient: contiucts uie tle loundution ol commeiciul
uctivities ol ull kinds und ol muny 'eveiyduy' tiunsuctions us well.
Muny speciulist uieus ol luw uie built on tlis loundution. It ulso
piesents un ideul oppoitunity loi students to tuke tle liist steps
towuids developing tle essentiul skills ol undeistunding
judgements und inteipieting stututes.
The lmportance oI case law
It cunnot be too stiongly emplusised tlut tlis is u case law
subject, so tlut wlut tle Exumineis will be seeking to test is youi
undeistunding ol low tle judges in tle leuding cuses luve
loimuluted und ielined tle ielevunt piinciples ol luw. You slould
uttempt to ieud tle impoitunt cuses; you cun do tlis ovei tle
inteinet on justis.com/
Tleie uie no sloitcuts to undeistunding tle development ol tle
cuse luw. Il tle job is to be well done, it will be time consuming.
Individuuls vuiy, obviously, but it would piobubly be exceptionul to
covei tle wlole syllubus tloiouglly in less tlun 2002S0 louis ol
study.
1.2 keading
See ulso tle SruJcnr HdnJoool und tle subject guide on Fng|isn jor
|dw dnJ |cgd| sruJy sli||s.
You slould begin youi ieuding witl tlis subject guide. Stuit ut tle
beginning und woik tliougl tle guide sequentiully, ieuding tle
textbook und doing tle uctivities us diiected. It muy be tempting to
stuit witl, suy, illegulity oi incupucity, but tlis is not u good ideu.
Tle subject builds on tle busic loundutions witlout wlicl un
undeistunding ol puiticului topics lutei in tle subject cunnot be
undeistood.
8
1.2.1 8ccks fcr everyday use
Tle muin text loi tlis subject is:
|cKerc||c|, |. Cort|oct |ow. (|orcor. |o||o.e |oca|||or, 2003) l|lt|

ec|t|or ||'b| 40392254[.
Tlis text loims tle loundution text loi tlis subject. It is udvisuble
to ieud und ie-ieud tlis text to ullow tle muteiiul to be tloiouglly
undeistood.
You slould ulso buy u cusebook; tlis guide is stiuctuied uiound:
|oo|e, I. Cosecoo| or Cort|oct |ow. (0\lo|c. 0\lo|c ur|.e|s|t, ||ess, 2003)

s|\t| ec|t|or ||'b| 0992o059[.
Becuuse tlese books uie not intended to be us compielensive in
tleii coveiuge ol tle muteiiuls us tle tiuditionul Univeisity
undeigiuduute texts loi luw, you will need to ielei liom time to
time to tle moie udvunced texts mentioned in tle next section.
1.2.2 Mcre advanced bccks
Tle moie detuiled textbook cuiiently consideied to be best suited
to tle needs ol exteinul students is:
beotsor, I. /rsor's |ow ol Cort|oct. (0\lo|c. 0\lo|c ur|.e|s|t, ||ess,

2002) 28t| ec|t|or ||'b| 09925o039[.
You muy ulso wisl to consult u moie detuiled cusebook. Heie tle
cloice lies between:
beo|e, |.C., w.D. b|s|op orc |.|. |u|astor Cort|oct - Coses orc
|ote||o|s. (|orcor. butte|wo|t|s, 200) lou|t| ec|t|or ||'b| 040o92404X[.
|cKerc||c|, |. Cort|oct - !e\t orc |ote||o|s. (0\lo|c. 0\lo|c ur|.e|s|t,

||ess, 2003) ||'b| 0992507oo[.
'a|t|, I.C. 'a|t| 8 !|oaos. / Cosecoo| or Cort|oct. (|orcor. 'weet 8

|o\we||, 2000) t| ec|t|or ||'b| 0427o908[.
Smitl und Tlomus is u tiuditionul cusebook concentiuting on
puiely legul muteiiuls. Tle otleis tuke u moie udventuious
uppioucl und seek to muke tle student uwuie ol widei issues. Tle
uutlois ol Beule, Bislop und Fuimston uie puiticuluily inteiested in
economic consideiutions und low tle luw woiks in piuctice.
McKendiick's cusebook is tle most iecent publicution. Tle piesent
uutlois' udvice would be to use McKendiick (us tle most up-to-dute
cusebook) us tle liist cloice, witl tle otleis in ieseive.
It is not suggested tlut you puicluse tle books mentioned in tlis
section: tley slould be uvuiluble loi ieleience in youi college oi
otlei libiuiy.
1.2.3 Statute bccks
You uie stiongly udvised to use tle lutest edition ol Stutute books.
A list ol tle muteiiuls tlut you uie peimitted to tuke into tle
exuminution is given in tle Rcgu|drions. You slould cleck tle
cuiient veision loi detuils.
Il you do tuke peimitted muteiiuls into tle exuminution, you must
puicluse youi own copy und it must be unmarked except loi
undeilining und/oi liglliglting ol pussuges ol text witl colouied
muikeis. Cleck tle cuiient Rcgu|drions loi detuils.
||eose rote t|ot t|e |ele|erces to
|cKerc||c| |r t||s sucject u|ce o|e o|| to
t|e l|lt| ec|t|or (2003).
|r t||s sucject u|ce t||s te\t |s |ele||ec to
s|ap|, os '/rsor'.
9
1.2.4 0ther bccks
!|e|te|, C.|. !|e |ow ol Cort|oct. (|orcor. 'weet 8 |o\we||, 2003)

e|e.ert| ec|t|or ||'b| 04278850X[.
|u|astor, |.|. C|es|||e, ||loot 8 |u|astor's |ow ol Cort|oct. (|orcor.

butte|wo|t|s, 200) ||'b| 040o930589[.
'tore, |. |oce|r |ow ol Cort|oct. (|orcor. Co.erc|s|, 2002)

||'b| 8594oo75[.
At tle otlei end ol tle scule, muny sloitei books luve been
publisled in iecent yeuis uimed ut tle student muiket. Il you uie
using McKendiick und Poole, you will geneiully not lind tlut tleie
is mucl benelit to be guined liom tlese otlei woiks. Howevei, loi
tle puiticului puipose ol piuctising tle uit ol wiiting exuminution
unsweis, you muy lind it lelplul to luve:
|c\eo, |. orc |. Cuape| |eo|r|r |\oa '||||s. (|orcor. b|oc|store ||ess,

99o) ||'b| 8543453[.
But do not be misled into tlinking tlut tlis will piovide you witl
'model unsweis' wlicl cun be leuined by leuit und iepioduced
liom memoiy in tle exuminution. Eveiy exuminution question
iequiies u specilic unswei und 'pie-puckuged' unsweis do not seive
tle puipose.
b|owr, |. orc /. C|orc|e| b|oc|store's 0 8 / |ow ol Cort|oct. (0\lo|c.

0\lo|c ur|.e|s|t, ||ess, 2003) lou|t| ec|t|or ||'b| 0992o0893[.
Tlis book contuins less ciiticul udvice on tle piocess ol unsweiing
exuminution questions tlun tle ubove title. It piovides u gieutei
iunge ol suggested solutions to questions.
ReIerences to the recommended books ln the gulde
Tlis guide is designed loi use in conjunction witl McKendiick's
textbook und Poole's cusebook. In eucl section ol tle guide
ieleience is mude to ull tle ielevunt puges ol tle liltl edition ol
McKendiick und tle sixtl edition ol Poole. In tle event tlut eitlei
ol tlese books is ieleused in u new edition beloie tle upduting ol
tlis guide, und loi tle gieutei guidunce ol tle ieudei, ieleience is
ulso mude to tle ielevunt cluptei und puge numbeis ol eucl book.
Foi exumple:
ssentiaI reading
|cKerc||c|, C|opte| 3. '0lle| orc /cceptorce', pp. 3-42.
|oo|e, C|opte| 2. '/|eeaert', pp. 9-40.

In uddition, ieleiences uie ulso given to tle ielevunt puges in
Anson`s ldw oj Conrrdcr, 28tl edition, us un uid to luitlei study und
ievision.
1.2.5 0ther scurces cf infcrmaticn
Journals
It is uselul to consult jouinuls ieguluily to impiove youi
undeistunding ol tle luw und to be uwuie ol iecent developments
in tle luw. Jouinuls wlicl muy piove uselul to you loi tleii uiticles
und cuse notes uie:
10
Coac||ce |ow Iou|ro|
Iou|ro| ol Cort|oct |ow
|ow 0uo|te||, |e.|ew
||o,c's |o||t|ae orc Coaae|c|o| |ow 0uo|te||,
|oce|r |ow |e.|ew
|ew |ow Iou|ro|.

Do not woiiy il you come ucioss muteiiul tlut you do not
undeistund: you simply need to ie-ieud it und tlink ubout it.
The Internet
Use ol tle Inteinet piovides tle exteinul student witl u gieut deul
ol inloimution, us u gieut deul ol legul muteiiul is uvuiluble ovei tle
Inteinet. Wlilst tle sites clunge on un ulmost montlly busis, some
uselul ones ut tle time ol wiiting tlis guide uie:
|ttp.//www.po|||oaert.t|estot|ore|,oll|ce.co.u| - upor w||c| cor ce

lourc lu|| te\ts ol t|e |ouse ol |o|cs' jucaerts
|ttp.//www.|aso.o..u|/octs.|ta - w||c| p|o.|ces t|e lu|| te\t ol uK /cts

coc| to 99
|ttp.//www.po|||oaert.u|/po|||oaert/s|teaop.|ta - t|e s|teaop lo| t|e

|o|||oaert ol t|e ur|tec K|rcoa, w||c| w||| p|o.|ce ,ou w|t| occess to o
|ore ol |e|s|ot|.e |rlo|aot|or
|ttp.//www.|owcoa.o..u| - t|e |ow Coaa|ss|or's wecs|te, t||s p|o.|ces

|rlo|aot|or ocout |ow |elo|a.
In uddition to tlese sites, u giowing numbei ol piivute publisleis
piovide legul inloimution und cuse updutes. Some sites wleie
uselul inloimution ubout iecent cuses und developments in tle luw
cun be lound uie:
|ttp.//www.cutte|wo|t|s.co.u|/ococea|c/coserotes.|ta
|ttp.//www.co.erc|s|puc||s||r.co.u|/
|ttp.//www.sweetorcao\we||.co.u|/
|ttp.//www.t|et|aes.co.u|/ - w|e|e ,ou cor c|ec| t|e |ow |epo|ts co||,.

In uddition, you uie piovided, us u puit ol youi eniolment on tle
Univeisity ol London Exteinul Piogiumme, witl uccess to
www.justis.com/
Not only does tlis site piovide you witl tle luw iepoits (in wlicl
you will be uble to ieview muny ol tle cuses discussed in tlis guide
und tle ielevunt muteiiuls) but it ulso piovides you witl u cuiient
cuses seivice wlicl will ullow you to ieud und unulyse tle most
iecent cuses.
11
1.3 Methcd cf wcrking
Remembei tlut youi muin objective is to undeistund tle piinciples
tlut luve been luid down in tle leuding cuses und to leuin low to
upply tlose piinciples to u given set ol lucts. As u iule ol tlumb,
leuding cuses muy be delined loi tlis puipose us tlose wlicl uie
included in tle ielevunt sections ol McKendiick und Poole togetlei
witl uny otlei (geneiully moie iecent) cuses cited in tlis subject
guide. At u moie piucticul level tle leuding cuses uie tlose ubout
wlicl un Exuminei would piobubly expect tle well-piepuied
cundidute to know. In tle nutuie ol tlings, just us dilleient
lectuieis will ielei to u dilleient selection ol cuses, tleie cun be no
ubsolutely delinitive list ol sucl cuses, but tleie will ulwuys be
ugieement on tle impoitunce ol muny ol tle cuses und in geneiul
teims, 'coie' cuses uie numed in tle guide. Howevei, spuce is
limited und omission liom tle guide slould not be tuken to meun
tlut u cuse is not woitl knowing.
It is suggested tlut tle study ol tle cuses slould be uppioucled in
tle lollowing steps:
1. Reud tle ielevunt section ol tlis subject guide.
2. Reud tle ielevunt pussuges ol McKendiick's text und Poole's
cusebook it muy ulso be udvisuble to exumine some cuses in
lull lollowing tlis.
3. Re-ieud tle ielevunt pussuges in McKendiick.
4. Attempt to unswei tle ielevunt uctivities oi sell-ussessment
questions.
S. Repeut tlis piocess loi eucl section ol tle subject guide.
A luitlei desciiption ol tle piocess in eucl ol tlese steps is set out
in luitlei detuil below.
1 Stuit witl tle ielevunt section ol tlis subject guide tlis will give
un ideu ol tle points you need to look loi. Tuke one section ut u
time do not tiy to digest seveiul ut once. Exumine tle leuining
outcomes: tlese uie tle mutteis you need to mustei in ielution to
eucl cluptei und sub-section witlin tle guide.
2 Reud tle textbook pussuge ieleiied to. Look in puiticului loi tle
cuses upon wlicl tle uutloi pluces speciul emplusis.
Reud tle cuses in tle cusebook (togetlei witl uny otleis
mentioned in tle subject guide puiticuluily tle moie iecent ones:
ieleiences uie given (wleie possible) in tle guide to tle All
Englund Luw Repoits so tlut you cun look up tle iecent cuses in
youi libiuiy). You will geneiully ulso be uble to lind tle cuse on
www.justis.com/ Tle impoitunce ol ieuding tle piimuiy muteiiuls
ol tle luw cuses und legislution cunnot be oveiemplusised.
Leuin us mucl us possible ubout eucl cuse. Muke u speciul elloit to
iemembei tle coiiect numes ol tle puities, tle couit wlicl decided
tle cuse puiticuluily il it is u House ol Loids oi Couit ol Appeul
decision tle essentiul lucts, tle rdrio JcciJcnJi und uny impoitunt
ooircr Jicrd. It is ulso impoitunt to note uny otlei stiiking leutuies,
sucl us, loi exumple, tle existence ol u stiong dissenting judgment,
tle oveiiuling ol pievious uutloiity oi uppuient inconsistency witl
otlei cuses. It is most impoitunt tlut you undeistund not only
what tle couit lus decided but ulso why it lus decided tlut.
'ee o|so |oo|e (200), C|opte| .
1Z
Knowing 'tle iules' is not enougl: it is essentiul to study tle
judgments und undeistund tle ieusoning wlicl led tle couit in u
puiticului cuse to uplold tle uiguments ol tle successlul puity und
ieject tle contentions put loiwuid no doubt peisuusively on
belull ol tle unsuccesslul puity. It is ulso impoitunt to be ciiticul
wlen studying tle cuses: usk youisell wletlei tle iesult pioduces
injustice oi inconvenience; wletlei tleie uie uny situutions in
wlicl you would not wunt tle iesult to upply und, il so, low tley
could be distinguisled. Il it is un oldei cuse, you slould ulso usk
youisell wletlei tle ieusoning lus been oveituken by clunges in
sociul und commeiciul lile geneiully. Lustly, puy uttention to tle
impuct ol otlei cuses in tle uieu. How stiong is un uutloiity in
liglt ol subsequent decisions?
3 Reud tle textbook pussuge uguin und usk youisell, 'Does tle
book's stutement ol tle ellect ol tle cuses coiiespond witl my
impiession ol tlem?' Il it does not, ieud tle cuses uguin.
4 You will lind uctivities und sell-ussessment questions tliouglout
tle guide. Tlese uie intended not only to build up youi knowledge
ol tle muteiiul but ulso to piovide you witl un oppoitunity to
meusuie youi knowledge und undeistunding ol tle puiticului
section. An uctivity demunds you to tlink ubout u puiticului
question und piepuie un unswei wlicl extends beyond u simple
'yes' oi 'no'. Feedbuck is piovided loi tlese unsweis ut tle end ol
eucl cluptei. Sell-ussessment questions uie designed to test youi
memoiy ol tle muteiiul wlicl you luve coveied. No leedbuck is
piovided loi tlese questions us tley luve simple unsweis uvuiluble
in tle textbook oi cusebook. Witl botl loims ol exeicises, you will
lind tlut youi knowledge is enlunced il you complete tle exeicises
us you encountei tlem in tle puiticului section. You will note tlut
eucl cluptei ol McKendiick ulso includes some exeicises loi sell-
ussessment: completing tlese will luitlei develop youi legul
knowledge und skills.
S Repeut tle piocess loi eucl section ol tle cluptei in tuin.
1.4 Scme issues in the Iaw cf ccntract
1.4.1 Statutes
Altlougl most ol tle syllubus deuls only witl piinciples developed
by tle couits, tleie uie ulso u lew stututoiy piovisions wlicl need
to be consideied becuuse tley contuin iules ullecting contiucts
geneiully. Foi tle puiposes ol tle suggested metlod ol woiking,
you slould uppioucl eucl ielevunt section ol u stutute us il it weie
u leuding cuse und muke u speciul elloit to get to know tle piecise
woiding ol ciuciul pliuses us well us uny cuses in wlicl tle section
lus been inteipieted und upplied. Remembei tlut in Englisl luw it
is tle judges wlo decide wlut Puiliument meunt by tle woids ol
tle stutute.
In geneiul, you uie not expected to displuy knowledge ol stututes
deuling witl puiticului types ol contiuct, sucl us tle Consumei
Ciedit Act 1974. (Some puits ol tle Sule ol Goods Act 1979 uie un
exception to tlis, lowevei: see Cluptei S: 'Tle teims ol tle
contiuct', section S.2.)
1J
1.4.2 urcpean unicn Iaw
Tle syllubus ieleis to tle inclusion ol ielevunt Euiopeun Union
legislution. At tle piesent time tle most signilicunt puit ol tle
geneiul luw ol contiuct wlicl is diiectly ullected by Euiopeun luw
is tlut deuling witl unluii teims. (Tlis is coveied in Cluptei 6: 'Tle
iegulution ol tle teims ol tle contiuct', section 6.3.) Otlei
diiectives wlicl uie impoitunt to tle geneiul luw ol contiuct uie
Diiective 2000/31/EC on Electionic Commeice OJ 2000 L 178/1
und Council Diiective 94/44/EC on Ceituin Aspects ol tle Sule ol
Consumei Goods und Associuted Guuiuntees OJ I 171 7.7.99.
1.4.3 1he 'ccnsensus' thecry cf ccntract and
cbjective interpretaticn
In tle pust, muny wiiteis und couits pluced mucl emplusis on tle
need loi u 'meeting ol minds' oi 'conscnsus dJ iJcm' loi tle muking
ol contiucts. Tlis ieliunce on uctuul intention wus un expiession ol
|disscz-jdirc plilosoplies und u beliel in unletteied lieedom ol
contiuct. Tlis subjective uppioucl to tle muking ol contiucts lus
now luigely been ubundoned, tlougl its inlluence cun still be
detected in ceituin iules. In geneiul, wlut mutteis toduy is not wlut
meuning u puity uctuully intended to convey by lis woids oi
conduct, but wlut meuning u reasonable person in tle otlei
puity's position would luve undeistood lim to be conveying. Tlis is
known us tle piocess ol 'objective inteipietution'.

See McKendiick
pp. 2123 und Poole pp. 1921 und tle cuses ieleiied to tleie,
especiully Hdrrog v Co|in dnJ Snic|Js (1939) und Ccnrrovincid|
Fsrdrcs v Mcrcndnr lnvcsrors (1983).
1.4.4 Finding 'the intenticn cf the parties'
You will soon discovei tlut, in spite ol tle disuppeuiunce ol tle
subjective uppioucl to tle muking ol contiucts, tle luw liequently
uses 'tle intention ol tle puities' us u test loi iesolving dilliculties.
It is most impoitunt to uppieciute tlut tlis does not ielei to tle
puities' uctuul intentions wlicl muy well luve been conllicting
but to tle 'piopei inleience' liom tle lucts us u wlole as to what
would have been the lntentlons oI a reasonable person
ln the posltlon oI the partles. Wlen deciding wlut is tle
'piopei' inleience u judge lus consideiuble ioom loi munoeuvie
und is in ieulity ieucling u conclusion bused upon tle justice ol tle
cuse us mucl us upon uny inleience in tle stiict sense. Foi un
instiuctive illustiution ol tlis piocess see tle judgment ol Denning
LJ in Oscdr Cncss v Wi||idms (19S7) see Poole (1999) 2492S1
wleie tle couit lud to decide wletlei u wuiiunty wus intended.
Note tlut Loid Denning delines tle test by ieleience to 'un
intelligent bystundei', but it is cleui tlut it is tle couit's
iesponsibility to diuw tle inleience und tlut tle intelligent
bystundei is meiely un ulius loi tle judge.
1.4.5 Law and equity
At one time in Englund und Wules, tleie weie two sepuiute couits
wlicl deult witl contiuct cuses: u couit ol equity und u couit ol
common luw. In tle luttei puit ol tle nineteentl centuiy, tlese
two couits weie umulgumuted und one couit deult witl botl luw
und equity. Equity lud developed its own piinciples,
14
consideiutions und iemedies to contiuctuul pioblems. Equity is suid
to supplement tle common luw wleie it is delicient. In tle couise
ol studying contiuct luw you will see muny equituble piinciples in
pluce (see, loi exumple, estoppel und undue inlluence). Equituble
inteivention in u contiuctuul pioblem is bused on tle conscience ol
tle puities; uccoidingly, equituble ieliel is discietionuiy und it is
bound by u distinct seiies ol consideiutions. An exumple ol sucl u
consideiution (sometimes ieleiied to us u muxim) is tlut 'le wlo
comes to equity must come witl cleun lunds'; tlut is to suy, le wlo
seeks equituble ieliel must limsell not be guilty ol some loim ol
misconduct oi sluip piuctice. You will see tle puiticului
iestiictions pluced upon tle giunting ol equituble ieliel us you
pioceed tliougl tle subject guide (see, loi exumple, iescission loi
misiepiesentution).
1.5 FIan cf the subject guide
In line witl tle oidei ol topics in tle syllubus:
Puit I ol tle guide deuls liist witl tle iequiiements loi tle
muking ol u contiuct (Clupteis 2, 3 und 4).
Puit II deuls witl tle content ol u contiuct und some ol tle

iegulutions ol tle teims ol u contiuct (Clupteis S und 6).
Puit III deuls witl tle cupucity to contiuct tle emplusis

pluced is upon minois' contiucts (Cluptei 7).
Puit IV deuls witl vitiuting elements in tle loimution ol u

contiuct (Clupteis 8 to 10).
Puit V deuls witl tle question ol wlo cun enloice tle teims ol
u contiuct (Cluptei 11).
Puit VI deuls witl illegulity und public policy (Clupteis 12 und

13).
Puit VII deuls witl tle discluige ol u contiuct (Clupteis 14 und

1S).
Puit VIII deuls witl iemedies loi u bieucl ol contiuct (Clupteis

16 und 17).
1cpics nct incIuded in the syIIabus
Altlougl tle lollowing topics uie toucled upon in tle
iecommended books (und coveied in some detuil in tle luigei
books), tley uie excluded liom tle piesent syllubus:
iequiiements us to tle loim ol contiucts
guming und wugeiing contiucts
ussignment (including negotiubility)
ugency.
1.5 Fcrmat cf the examinaticn paper
Important: tle inloimution und udvice given in tle lollowing
section uie bused on tle exuminution stiuctuie used ut tle time tlis
guide wus wiitten. Howevei, tle Univeisity cun ultei tle loimut,
style oi iequiiements ol un exuminution pupei witlout notice.
Becuuse ol tlis we stiongly udvise you to cleck tle
iubiic/instiuctions on tle pupei you uctuully sit.
1
Pust exuminution pupeis cun be u uselul pointei to tle type ol
questions wlicl lutuie pupeis will piobubly include, but you slould
tuke cuie not to ieud too mucl into tle style und loimut ol pust
pupeis. Remembei tlut, in tlis us in otlei subjects, tle Exumineis
muy clunge tle loimut liom yeui to yeui loi exumple, by
iequiiing u dilleient numbei ol questions to be unsweied, by
splitting u pupei into Puit A und Puit B, witl some questions to be
unsweied liom eucl puit, oi by muking some questions compulsoiy
und you must ulwuys ieud und comply witl tle instiuctions loi
tle puiticului pupei you uie tuking. Tle unnuul SruJcnr HdnJoool
will noimully give udvunce wuining ol clunges in tle loimut ol
question pupeis, but tle Exumineis will luve no symputly witl u
cundidute wlo does not ieud tle instiuctions piopeily.
1.6.1 'Spctting' questicns
As we mentioned ut tle beginning ol tlis Intioduction, tleie is no
guuiuntee tlut tleie will be u question on uny puiticului topic in
uny given exuminution pupei. It is u mistuke tleieloie to ussume
tlut topic A is so impoitunt tlut tle Exumineis uie bound to set u
question on it und you slould beui tlis in mind wlen deciding low
muny topics you need to luve ut youi lingeitips us you go into tle
exuminution. It is ulso woitl noting tlut questions muy eusily
involve moie tlun one topic.
1.6.2 xaminaticn technique in generaI
Muke tle most ol youi knowledge by obseiving u lew simple iules.
See ulso tle subject guide on Fng|isn jor |dw dnJ |cgd| sruJy sli||s,
Clupteis 6 und 7.
1 Wiite legibly, using u good duik pen. Il necessuiy, wiite moie
slowly tlun noimul to impiove legibility tle time lost will be
umply iepuid by not luving un iiiituted Exuminei.
2 Complete tle iequiied numbei ol questions, including ull puits ol
questions witl two oi moie puits.
3 Plun youi time so tlut you spend ubout tle sume umount ol time
on eucl question. One ol tle woist mistukes you cun muke is to
oveiiun on tle liist two unsweis: you uie not likely to impiove
mucl on tle quulity ol tlose unsweis und you will only incieuse tle
piessuie und tension wlile you uie tiying to linisl tle otlei
questions witl inudequute time iemuining.
4 Reud tle questions veiy cuielully looking loi lints us to tle
puiticului issues tle Exuminei lopes you will discuss. Tlink ubout
wlut tle Exuminei is usking you to do: wlut is tle question ubout?
It is not tle quantlty you wiite but low well you unulyse tle
question und identily tle ielevunt issues tlut will deteimine tle
quulity ol youi unsweis. Do not wuste time iepeuting tle lucts ol
tle question oi setting out tle wlole ol tle luw on u topic wlen tle
question is only ubout puit ol it. Irrelevant materlal not only
earns no marks but actually detracts Irom the quallty oI
the answer as a whole.
S Remembei ubove ull tlut tle Exuminei is puiticuluily inteiested
in low well you know tle cuse luw: ulwuys tiy to uigue liom
named cuses. Avoid meiely listing u lot ol cuse numes: select tle
most ielevunt cuses und slow low und to wlut extent eucl one
suppoits youi uigument. Stute tle lucts biielly, suy wlicl couit
1
decided tle cuse (especiully il it is u Couit ol Appeul oi House ol
Loids decision) und indicute tle piocess ol ieusoning wlicl led tle
judges to decide tle cuse in tle wuy tley did (loi exumple, did tley
decline to lollow un euiliei decision und, il so, wly?). Even un
'essuy' question will be looking loi tlis soit ol discussion ol tle cuse
luw.
6 It is veiy impoitunt to plun out youi unswei in u iougl loim (on
sepuiute puges) beloie you begin to wiite youi unswei. An essentiul
teclnique is to wiite out u 'slopping list' ol tle points und tle
cuses wlicl you intend to covei. Il tleie is u signilicunt
clionology in tle question, muke u list ol tle sequence ol events
witl tleii dutes/times. You slould develop u logicul oidei ol
piesenting youi points: muny points will luve to piecede otleis.
Ideully youi lists slould be on u piece ol pupei tlut you cun ielei to
at all tlmes wlile wiiting tle unswei witlout luving to tuin ovei
puges in tle unswei book. Il you do not muke sucl lists, oi do not
luve tlem wleie you cun eusily ielei to tlem, you uie bound to
loiget sometling.
7 Remembei tlut uiguments tle exploiution ol possibilities uie
moie impoitunt tlun conclusions, so you slould not leel obliged to
come down too liimly on one side noi slould you be inlibited by
tle luct tlut you uie not suie wlut tle 'coiiect' unswei is. It is in
tle nutuie ol tle Englisl system ol judiciul piecedent tlut tleie is
neuily ulwuys ioom loi uigument ubout tle scope ol u pievious
iuling, even by tle House ol Loids, so tlut it is quite possible, even
likely, tlut moie tlun one view is tenuble. It is lui bettei to put
loiwuid u ieusoned submission wlicl tle Exuminei muy peilups
disugiee witl tlun to tiy und dodge tle issue by suying us
suipiisingly muny cundidutes do 'As tle luw is uncleui (oi, tle
uutloiities uie conllicting) it will be loi tle couit to decide'.
Muke suie tlut you unswei tle question wlicl tle Exuminei lus
usked. Tlink cuielully ubout wlut tle question usks ol you und
piovide un unswei to tlut question not to u ieluted (oi even
woise, unieluted) topic.
Enjoy youi studies, und good luck.
Cdrndrinc MdcMi||dn dnJ RicndrJ Sronc,
lcorudry 2004
1
Parl | Requirereuls or lhe ra|iug o a
coulracl
[Chapters 2-4]
18
ur|.e|s|t, ol |orcor |\te|ro| ||o|oaae 19
Chapler Z 0er aud acceplauce
Ccntents
Intrcducticn 19
2.1 1he cffer 20
2.2 Ccmmunicaticn cf the cffer 24
2.3 Acceptance cf the cffer 25
2.4 Ccmmunicaticn cf the acceptance 26
2.5 xcepticns tc the need fcr ccmmunicaticn cf the
acceptance 27
2.6 Methcd cf acceptance 29
2.7 1he end cf an unaccepted cffer 31
Intrcducticn
Tle luw ol contiuct is muinly ubout tle enloicement ol piomises.
Not ull piomises uie enloiced by couits. To enloice u set ol
piomises, oi un ugieement, couits look loi tle piesence ol ceituin
elements. Wlen tlese elements uie piesent u couit will lind tlut
tle ugieement is u contiuct. Tlis is u somewlut uitiliciul piocess.
To u ceituin extent, couits will lind tlut some ugieements slmply
look llke contracts und tley tlen ieuson buckwuid und lind
tle elements necessuiy to loim u contiuct.
As u student you need to be uwuie ol tle elements iequiied to
constitute un enloiceuble contiuct.
To suy tlut we luve u contiuct meuns tlut tle puities luve
voluntarlly assumed llabllltles wlth regard to each other.
Tle piocess ol ugieement begins witl un ollei. Foi u contiuct to be
loimed, tlis ollei must be unconditionully uccepted. Tle luw
imposes vuiious iequiiements us to tle communicution ol tle ollei
und tle ucceptunce. Once tleie lus been u vulid communicution ol
tle ucceptunce, tle luw iequiies tlut ceituin otlei elements
(coveied in clupteis 3 und 4) uie piesent.
Il tlese elements uie not piesent, u couit will not lind tlut u
contiuct exists between tle puities. In tle ubsence ol u contiuct,
neitlei puity will be bound to tle tentutive piomises oi ugieements
tley luve mude. It is tlus ol ciiticul impoitunce to deteimine
wletlei oi not u contiuct lus been loimed.
Z0 ur|.e|s|t, ol |orcor |\te|ro| ||o|oaae
Learning cutccmes
b, t|e erc ol t||s c|opte| orc t|e |e|e.ort |eoc|r, ,ou s|ou|c ce oc|e to.
e\p|o|r w|ot or olle| |s
c|st|ru|s| cetweer or olle| orc ot|e| coaaur|cot|ors
stote w|er or olle| |os ceer coaaur|cotec
e\p|o|r w|ot o .o||c occeptorce |s (orc |s rot)
|||ust|ote t|e recess|t, ol coaaur|cot|r t|e occeptorce
|rc|cote w|ot t|e e\cept|ors o|e to t|e recess|t, ol coaaur|cot|r t|e
occeptorce
e\p|o|r w|ot occu|s w|er t|e olle|o| st|pu|otes o ce|to|r aet|oc ol
occeptorce
stote w|ot |oppers to or olle| w||c| |s rot occeptec
|||ust|ote w|er or olle| e\p||es.
2.1 1he cffer
ssentiaI reading
|cKerc||c|, C|opte| 3. '0lle| orc occeptorce' - up to 3.7 /cceptorce,
pp. 33-44.
|oo|e, C|opte| 2. '/|eeaert 'ect|or 'ucject|.|t, .s 0cject|.|t, to 'ect|or
4 /cceptorce', pp. 7-34.
You must ieulise tlut it is not tle subjective intentions ol tle puities
tlut deteimine tle legul ellect ol tleii woids oi uctions but tle
objective inleience liom tlem. Tlut is to suy, tle ollei is
inteipieted uccoiding to un objective intention tle inteipietution
tle ieusonuble peison in tle position ol tle olleiee would pluce
upon tle stutement oi uction ol tle olleioi. Tlis is ciuciul in
unsweiing tle busic question 'wlut is un ollei?' See Ccnrrovincid|
Fsrdrcs v Mcrcndnr lnvcsrors Assurdncc Compdny (1983) ieguiding
tle objective iequiiement.
An ollei is un expiession ol willingness to contiuct on ceituin teims.
It must be mude witl tle lntentlon tlut it will become blndlng
upon ucceptunce. Tleie must be no luitlei negotiutions oi
discussions iequiied. Tle nutuie ol un ollei is encupsuluted by two
cuses involving tle sume delendunt, Munclestei City Council. Tle
Council decided to sell louses tlut it owned to sitting tenunts. In
two cuses, tle cluimunts enteied into ugieements witl tle Council.
Tle Council tlen iesolved not to sell lousing unless it wus
contiuctuully bound to do so. In tlese two cuses tle question uiose
us to wletlei oi not tle Council lud enteied into u contiuct.
In one cuse, Srorcr v Mdncncsrcr Ciry Counci| (1974), tle Couit ol
Appeul lound tlut tleie wus u binding contiuct. Tle Council lud
sent Stoiei u communicution tlut tley intended would be binding
upon lis ucceptunce. All Stoiei lud to do to bind limsell to tle
lutei sule wus to sign tle document und ietuin it.
C|opte| 2 0lle| orc occeptorce
ur|.e|s|t, ol |orcor |\te|ro| ||o|oaae Z1
In contiust, lowevei, in Cioson v Mdncncsrcr Ciry Counci| (1979),
tle Council sent Gibson u document wlicl usked lim to muke u
loimul invitution to buy und stuted tlut tle Council 'muy be
piepuied to sell' tle louse to lim. Gibson signed tle document und
ietuined it. Tle House ol Loids leld tlut u contiuct lud not been
concluded becuuse tle Council lud not mude un ollei cupuble ol
being uccepted. Loid Diplock stuted:
Tle woids 'muy be piepuied to sell' uie lutul.so is tle invitution, not,
be it noted, to uccept tle ollei, but 'to muke loimul upplicution to buy'
on tle enclosed upplicution loim. It is.u lettei setting out tle
linunciul teims on wlicl it muy be tle council would be piepuied to
considei u sule und puicluse in due couise.
An impoitunt distinction between tle two cuses is tlut in Srorcr`s
cuse tleie wus un ugieement us to piice, but in Cioson`s cuse tleie
wus not. In Cioson, impoitunt teims still needed to be deteimined.
It is veiy impoitunt to ieulise liom tle outset tlut not ull
communicutions will be olleis. Tley will luck tle iequisite intention
to be bound upon ucceptunce. Il tley uie not olleis, wlut uie tley?
At tlis point, we will distinguisl un ollei liom otlei steps in tle
negotiution piocess. Otlei steps in tle negotiution piocess miglt
include u stutement ol intention, u supply ol inloimution oi un
invitution to tieut. We will exumine tlese in tuin.
2.1.1 A statement cf intenticn
In tlis instunce, one puity stutes tlut le lntends to do sometling.
Tlis dilleis liom un ollei in tlut le is not stuting tlut le wlll do
sometling. Tle cuse ol Hdrris v Niclcrson (1873) illustiutes tlis
point. Tle uuctioneei's udveitisement wus u stutement tlut le
intended to sell ceituin items; it wus not un ollei tlut le would
sell tle items.
2.1.2 A suppIy cf infcrmaticn
In tlis instunce, one puity piovides inloimution to unotlei puity.
He supplies tle inloimution to enliglten tle otlei puity. Tle
stutement is not one tlut is intended to be ucted upon. See ulso tle
cuse ol Hdrvcy v ldccy (1893) wleie one puity telegiupled, in
iesponse to tle queiy ol tle otlei, wlut tle lowest piice wus tlut
le would uccept loi lis piopeity.
2.1.3 An invitaticn tc treat
Tlis is u puzzling teim. An invitution to tieut is un indicution ol u
willingness to conduct business. It is un invitution to muke un ollei
oi to commence negotiutions. Couits luve consideied wletlei oi
not u communicution wus un ollei oi un invitution to tieut in u wide
vuiiety ol ciicumstunces.
You slould exumine tle lollowing instunces wleie couits luve
lound tlut tle communicution wus not un ollei but un invitution to
tieut.
(u) A dlsplay oI goods is geneiully un invitution to tieut.
See Pndrmdccuricd| Socicry v Boors (19S3) note tle iutionule
belind tieuting tle displuy us un invitution to tieut iutlei tlun us
un ollei und lisncr v Bc|| (1961). Wleie tle displuy is mude by u
mucline, tle displuy will piobubly be un ollei: Tnornron v Snoc
ldnc Pdrling (1971).
||eaertsolt|e|owolcort|oct
ZZ ur|.e|s|t,ol|orcor|\te|ro|||o|oaae
Activity2.1
You||oco||oce|,s|opp|oceso|eol|ett||ou|,ou||ette|co\.0rt|e|eol|et|s
p||rtec!oao||owor|,,o|oreso|eotospec|o||ow,|owp||ceol9p/|||o.
|ost|e|oce|,s|opaoce,ouorolle|`|l,ou.|s|tt|es|op,austt|e,se||,ou
o|oresott||sp||ce`
Feedbuck:seepuge37.
(b)Anadvertlsementisuninvitutiontotieut.
See PdrrriJgcvCrirrcnJcn(1968)tleudveitisementolubiluteiul
contiuct.Tleloimoltlecontiuctwillgiveiisetodilleientiesults
Cdr|i||vCdroo|icSmolcBd||Compdny(1893)decidedtlutun
udveitisementwusuuniluteiulollei.
Flgure2.1TheadvertlsementIorCarbollc5mokeBalls
ur|.e|s|t, ol |orcor |\te|ro| ||o|oaae ZJ
Activity 2.2
|ow we|e t|e locts ol Co||||| . Co|co||c 'ao|e bo|| c|lle|ert l|oa t|e usuo|
s|tuot|or |r.o|.|r or oc.e|t|seaert`
Feedbuck: see puge 37.
(c) A request Ior tenders is un invitution to tieut und tle tendei
is tle ollei. See Hdrvc|d lnvcsrmcnrs lrJ v Royd| Trusr Co oj CdndJd
lrJ (198S).
Note, lowevei, tlut tle invitution to tieut muy contuin un implied
undeituking to considei ull conloiming tendeis, us in B|dclpoo| dnJ
ly|Jc Acro C|uo lrJ v B|dclpoo| Borougn Counci| (1990).
(d) An auctloneer's request Ior blds is un invitution to tieut.
Tle bid is un ollei; wlen tle uuctioneei biings lis lummei down
le lus uccepted tle ollei. In tle cuse ol uuctions witlout u ieseive
piice, tle uuctioneei enteis into u colluteiul (oi sepuiute) contiuct.
Tle nutuie ol tle colluteiul contiuct is tlut tle uuctioneei will
uccept tle liglest bid. See Wdr|ow v Hdrrison (18S9) und Bdrry v
udvics (2000).
SeIf-assessment questicns
|ow coes or |r.|tot|or to t|eot c|lle| l|oa or olle|`
2 Does o |o||wo, o| o||||re t|aetoc|e corst|tute or olle|`
3 |ow co cou|ts t|eot t|e c|sp|o, ol oocs |r o s|op w|rcow c|lle|ert|, l|oa o
c|sp|o, |r or outoaotec aoc||re`
Summary
A contiuct begins witl un ollei. Tle ollei is un expiession ol
willingness to contiuct on ceituin teims. It ullows tle otlei puity to
uccept tle ollei und piovides tle busis ol tle ugieement. An ollei
exists wlenevei tle objective inleience liom tle olleioi's woids oi
conduct is tlut sle intends to commit leisell legully to tle teims
sle pioposes. Tlis commitment occuis witlout tle necessity loi
luitlei negotiutions. Muny communicutions will luck tlis necessuiy
intention und tlus will not be olleis. Tley muy be stutements ol
intention, supplies ol inloimution oi invitutions to tieut. Altlougl
tle distinction between un ollei und otlei steps in tle negotiuting
piocess is eusy to stute in tleoiy, in piuctice, dillicult cuses uiise.
keminder cf Iearning cutccmes
b, t||s stoe ,ou s|ou|c ce oc|e to oc||e.e t|e lo||ow|r |eo|r|r outcoaes.
e\p|o|r w|ot or olle| |s
c|st|ru|s| cetweer or olle| orc ot|e| coaaur|cot|ors (e.. or |r.|tot|or to
t|eot, o |euest lo| |rlo|aot|or, o stoteaert ol |rtert|or).
usefuI further reading
/rsor, pp. 27-38.
ure|, ''e|lse|.|ce s|ops orc t|e |ow ol cort|oct', o ||| 3o9.
w|rl|e|c, ''oae ospects ol olle| orc occeptorce', 55 |0| 499.
2.2 Ccmmunicaticn cf the cffer
ssentiaI reading
|cKerc||c|, C|opte| 3. '0lle| orc occeptorce' - 3.9 /cceptorce |r
|ro|orce ol t|e 0lle|, pp. 45-4o.
|oo|e, C|opte| 2. '/|eeaert 'ect|or 4 b /cceptorce aust ce aoce |r
|esporse to t|e olle|', pp. 38-40.
To be ellective, un ollei must be communicuted. Anotlei wuy ol
stuting tlis is to suy tlut tleie cun be no ucceptunce ol tle ollei
witlout knowledge ol tle ollei. Tle ieuson loi tlis iequiiement is
tlut il we suy tlut u contiuct is un ugieed buiguin, tleie cun be no
ugieement witlout knowledge. Tleie cun be no 'meeting ol tle
minds' il one mind is unuwuie ol tle otlei. Stuted unotlei wuy, un
ucceptunce cunnot 'miiioi' un ollei il tle ucceptunce is mude in
ignoiunce ol tle ollei.
Tle uutloiities uie, lowevei, divided on tle need to communicute
tle ollei. In tle cuse ol Ciooons v Procror (1891) u policemun wus
ullowed to iecovei u iewuid wlen le sent inloimution in ignoiunce
ol tle ollei ol iewuid. Tle bettei view is tlouglt to be expiessed in
tle Austiuliun cuse ol R v C|drlc (1927):
tleie cunnot be ussent witlout knowledge ol tle ollei; und ignoiunce
ol tle ollei is tle sume tling wletlei it is due to nevei leuiing ol it
oi loigetting it ultei leuiing.
Tle cuse ol Tinn v Hojjmdn (1873) deuls witl tle pioblem ol cioss-
olleis.
Activities 2.3-2.4
2.3 wos t|e cec|s|or |r | . C|o||e |rl|uercec c, t|e corsersus t|eo|, ol
cort|oct` '|ou|c |t |o.e ceer`
2.4 |ow a||t t|e cec|s|or |o.e ceer c|lle|ert |l C|o||e |oc ceer o poo| cut
|orest w|cow`
b, t||s stoe ,ou s|ou|c ce oc|e to oc||e.e t|e lo||ow|r |eo|r|r outcoae.
stote w|er or olle| |os ceer coaaur|cotec.
16 MLk 369. !||s |s o storco|c |ele|erce
to .o|uae o ol t|e |oce|r |ow |e.|ew.
!|e o|t|c|e oppeo|s ot poe 3o9 ol t|ot
.o|uae.
'ee C|opte| , s..4.3.
ur|.e|s|t, ol |orcor |\te|ro| ||o|oaae Z
/rsor, pp. 49-50.
2.3 Acceptance cf the cffer
ssentiaI reading
|cKerc||c|, C|opte| 3. '0lle| orc occeptorce' - 3.7 /cceptorce, p. 44.
|oo|e, C|opte| 2. '/|eeaert 'ect|or 4 / !|e a|||o| |aoe |u|e',
pp. 34-38.
Foi u contiuct to be loimed, tleie must be un ucceptunce ol tle
ollei. Tle ucceptunce must be un ugieement to eucl ol tle teims ol
tle ollei. It is sometimes suid tlut tle ucceptunce must be u 'miiioi
imuge' ol tle ollei.
Tle ucceptunce cun be by woids oi by conduct. SeeBrogJcn v
Mcrropo|irdn Rdi|wdy Compdny (1871), wleie tle olleiee uccepted
tle ollei by peiloimunce. Moie iecent instunces ol ucceptunce by
conduct cun be lound in Conjcrri RccorJs v Wdrncr Music 0k lrJ
(rd Fdsr Wcsr RccorJs) [2003| EWHC 1274 wleie Conletti Recoids
sent Wuinei u music tiuck und un invoice; tlis wus un ollei cupuble
ol ucceptunce by Wuinei's conduct in pioducing un ulbum wlicl
contuined tle tiuck. In udy Morris Associdrcs v \oycc [2003| EWCA
Civ 189 it wus leld tlut un estute ugent's ollei to muiket u piopeity
lud been uccepted by tle conduct ol tle client. Tle client's
conduct wus ullowing tle ugent to udveitise tle piopeity und slow
luige numbeis ol people uiound it.
Acceptunce occuis wlen tle olleiee's woids oi conduct give iise to
tle objective inleience tlut tle olleiee ussents to tle olleioi's
teims.
Il tle olleiee uttempts to udd new teims wlen uccepting, tlis is u
countei-ollei und not un ucceptunce. A countei-ollei implies u
iejection ol tle oiiginul ollei, wlicl is tleieby destioyed und
cunnot subsequently be uccepted. See HyJc v Wrcncn (1840).
Wleie tle olleiee queiies tle ollei und seeks moie inloimution,
tlis is neitlei un ucceptunce noi u iejection und tle oiiginul ollei
stunds. See Srcvcnson, Jdcqucs 8 Co. v Mclcdn (1880).
In some cuses, tle puities will uttempt to contiuct on (dilleiing)
stunduid loims. In tlis instunce, tleie will be u 'buttle ol tle loims'
witl olleis und countei olleis pussing to und lio. Tle Couit ol
Appeul lus leld tlut tle 'lust slot' wins tlis 'buttle ol tle loims'.
See Bur|cr Mdcninc Too| v Fx-Cc||-o (1979).
Activities 2.5-2.6
2.5 / w|ote to b olle||r 300 cos ol ceaert ot 0 pe| co. b w|ote |r |ep|,
t|ot s|e wos .e|, |rte|estec cut reecec to |row w|et|e| |t wos ||ea|ua 0uo||t,
ceaert.
Z ur|.e|s|t, ol |orcor |\te|ro| ||o|oaae
!|e lo||ow|r ao|r|r, soor olte| / |eoc b's |ette|, b |eo|c o |uaou| t|ot t|e
p||ce ol ceaert wos ocout to ||se. '|e |aaec|ote|, sert o lo\ to / stot|r,
'/ccept ,ou| p||ce ol 0 lo| ||ea|ua 0uo||t,'. /ssua|r t|ot t|e ceaert
octuo||, |s ||ea|ua 0uo||t,, |s t|e|e o cort|oct` (|l so, coes t|e p||ce |rc|uce
ce||.e|,`) |\p|o|r ,ou| |eosor|r.
2.6 w|ot |s t|e pos|t|or urce| t|e '|ost s|ot |u|e' |l, olte| t|e e\c|ore ol lo|as,
t|e se||e| lo||s to ce||.e| t|e oocs`
e\p|o|r w|ot o .o||c occeptorce |s (orc |s rot).
/rsor, pp. 38-4.
2.4 Ccmmunicaticn cf the acceptance
ssentiaI reading
|cKerc||c|, C|opte| 3 '0lle| orc occeptorce' - 3.8 Coaaur|cot|or ol t|e
/cceptorce, 3.0 ||esc||cec |et|oc ol /cceptorce orc 3. /cceptorce c,
'||erce, pp. 44-45, 4o-49.
|oo|e, C|opte| 2 '/|eeaert 'ect|or 4 D(o) |ap||ec wo|.e| ol t|e reec to
coaaur|cote', pp. 4-42.
Tle geneiul iule is tlut ucceptunce is not ellective until it is
communicuted to tle olleioi. Tlis is sometimes expiessed by suying
tlut tle ucceptunce cunnot be mude tliougl silence. See lc|rnousc
v BinJ|cy (1862). Tle olleioi cunnot wuive communicution il tlut
would be to tle detiiment ol tle olleiee.
Activity 2.7
You olle| to cu, o |||o ol o|ores l|oa ,ou| |oco| s|op lo| 9p. |ot||r lu|t|e| |s
so|c, ro| co ,ou |ece|.e or, w||tter co||esporcerce. !|e re\t co,, |owe.e|, o
|||o ol o|ores o|||.es ot ,ou| |ouse l|oa t|e |oco| s|op. |s t|e|e o .o||c
occeptorce ol t|e cort|oct` |os t|e|e ceer o coaaur|cot|or ol t|e occeptorce`
'ee b|ocer . |et|opo||tor |o||wo, Coapor, (87).
In tle cuse ol u uniluteiul contiuct, Cdr|i|| v Cdroo|ic Smolc Bd||
Compdny (1893) estublisles tlut tle peiloimunce is tle ucceptunce
und tleie is no need to communicute tle uttempt to peiloim.
Communicution ol tle ucceptunce is wuived becuuse it would be
unieusonuble ol tle olleioi to iely on tle ubsence ol u
communicution wlicl would luve been supeilluous oi wlicl no
ieusonuble peison would expect to be mude.
unilateral contract. ore w|e|e ore po|t,
ao|es or olle| |l t|e ot|e| po|t, coes
soaet||r, cut t|e ot|e| po|t, reec rot
o|ee to co t|ot t||r. /r e\oap|e wou|c
ce olle||r o |ewo|c lo| |rlo|aot|or ocout
o c||ae.
ur|.e|s|t, ol |orcor |\te|ro| ||o|oaae Z
w|ot wos t|e cet||aert to t|e olle|ee |r |e|t|ouse . b|rc|e,`
2 Cou|c or olle|o| use t||s cose to o.o|c ||oc|||t,`
|||ust|ote t|e recess|t, ol coaaur|cot|r t|e occeptorce.
/rsor, pp. 4-43.
2.5 xcepticns tc the need fcr ccmmunicaticn cf
the acceptance
ssentiaI reading
|cKerc||c|, C|opte| 3 '0lle| orc occeptorce' - 3.2 |\cept|ors to t|e |u|e
|eu|||r coaaur|cot|or, pp. 49-52.
|oo|e, C|opte| 2 '/|eeaert 'ect|or 4 D(c) !|e posto| occeptorce |u|e to
'ect|or 5 |e.ocot|or ol or olle|', pp. 49-o0.
As we suw ubove, tle geneiul iule is tlut loi un ucceptunce to be
vulid it must be communicuted to tle olleioi. It must be biouglt to
tle olleioi's uttention. To tlis geneiul iule tleie uie ceituin
exceptions situutions wleie tle luw does not iequiie
communicution ol tle ucceptunce. Tle piincipul exception is tle
postul ucceptunce iule.
2.5.1 Where the cffercr has waived the
requirement cf ccmmunicaticn
As we luve seen ubove, in ceituin ciicumstunces tle olleioi muy
wuive tle necessity loi communicution. Tlis is wlut occuiied in
Cdr|i|| v Cdroo|ic Smolc Bd|| Co.
A weukness to tlis exception is tlut it uppeuis to be ol limited
upplicution wleie tleie is u biluteiul contiuct. In lc|rnousc v
BinJ|cy, tle uigument cun be mude tlut tle uncle lud cleuily
wuived uny need loi tle neplew to communicute lis ucceptunce ol
tle ollei und yet tle couit leld tlut tle ollei lud not been
uccepted.
2.5.2 1he pcstaI acceptance ruIe
Communicution by post gives iise to speciul piucticul dilliculties. An
ollei is posted. Tle olleiee ieceives tle ollei und posts lei
ucceptunce. Tle lettei ol ucceptunce will tuke seveiul duys to uiiive.
At wlut point is tle ucceptunce good? Il one wuits until tle olleioi
ieceives tle lettei, low will tle olleiee know wlen tlis is? Tle
olleiee lus known liom tle time sle posted tle lettei tlut sle lus
uccepted tle ollei. Tleie is ulso tle occusionul pioblem ol tle lettei
tlut nevei uiiives ut its destinution.
To oveicome tlese pioblems, tle couits devised un exception to tle
geneiul iequiiement ol communicution (wlicl would luve been
tlut tle ucceptunce is only good wlen tle lettei uiiives). Tle
exception wus devised in tle cuses ol AJdms v linJsc|| (1818) und
Houscno|J lirc lnsurdncc v Crdnr (1879).
Tlese decisions estublisl tle 'postul ucceptunce iule', tlut is, tlut
ucceptunce is complete wlen posted. Tlis puts tle iisk ol deluy und
loss on tle olleioi. It is impoitunt to undeistund tlut tle iule is un
exceptlon to tle geneiul iule iequiiing communicution.
Tle postul ucceptunce iule will only pievuil in ceituin
ciicumstunces. It will pievuil wleie use ol tle post wus ieusonubly
contempluted by tle puities oi stipuluted by tle olleioi. See
Houscno|J lirc lnsurdncc v Crdnr (1879).
It muy be tlut tle post is tle only ieusonuble loim ol
communicution uvuiluble. SeeHcnrnorn v lrdscr (1892).
Tle opeiution ol tle postul ucceptunce iules cieutes piucticul
dilliculties. Tle gieutest pioblem is tlut contiucts cun be loimed
witlout tle olleioi being uwuie ol tle contiuct. Foi exumple, un
olleioi mukes un ollei. Unbeknown to lim, tle olleiee uccepts. Tle
olleioi tlen ievokes tle ollei beloie ieceiving tle postul
ucceptunce. Tle olleioi contiucts witl unotlei puity ovei tle sume
muttei und tlen ieceives tle postul ucceptunce liom tle oiiginul
olleiee. Tle olleioi is now in bieucl ol lis contiuct witl tle
oiiginul olleiee.
Puitly becuuse ol tlese pioblems und puitly becuuse ol
teclnologicul udvunces (tle post is no longei u ciuciul
communicution device), couits seem to be conlining tle scope ol
tle postul ucceptunce iule. Tlis is u iutionule belind tle decision in
Ho|wc|| Sccurirics v Hugncs (1974). In tlis cuse, tle postul
ucceptunce iule did not upply becuuse tle olleioi did not intend
tlut it would upply. Wlile tlis cuse is uutloiity loi tle pioposition
tlut tle teims ol un ollei must be met loi ucceptunce to be vulid, it
ulso illustiutes tle ieseivutions modein couits luve witl tle postul
ucceptunce iule.
As modein loims ol communicution sucl us lux und emuil luve
become ulmost instuntuneous, couits luve slown u muiked
ieluctunce to extend tle postul ucceptunce iule to tlese new loims
ol communicution. In un euily cuse involving u telegium, u loim ol
tle postul ucceptunce iule wus lowevei upplied. See Bruncr v
Moorc (1903).
In lutei cuses involving telexes, tle couits ielused to extend tle
upplicution ol tle postul ucceptunce iules. See Fnrorcs v Mi|cs ldr
Fdsr Corp (19SS) und Brinlioon lrJ v Srdndg Srdn| (1982).
Tlese cuses uie ulso impoitunt loi tle piinciples tley estublisl witl
iespect to instuntuneous loims ol communicution.
Englisl contiuct luw uwuits u cuse involving un ulmost
instuntuneous communicution sucl us u lux oi un emuil. Becuuse
ol tle teclnology involved in botl tlese loims ol communicution
tley uie not entiiely instuntuneous. An emuil, in puiticului, muy
tuke some time to uiiive ut its destinution, depending upon tle
ioute it tukes to its iecipient.
ur|.e|s|t, ol |orcor |\te|ro| ||o|oaae Z9
Activity 2.8
w|ot |u|es co ,ou t||r| cou|ts s|ou|c ocopt lo| coaaur|cot|or c, lo\ o| eao||`
w|ot |eosors |o.e ceer |.er c, t|e cou|ts lo| t|e posto| occeptorce |u|e`
2 / posts o |ette| olle||r to c|eor b's |ouse. b posts o |ette| occept|r /'s olle|.
|ote| |r t|e co,, b's |ouse cu|rs cowr orc b row ro |ore| reecs o |ouse
c|eore|. b |aaec|ote|, posts o |ette| to / |eject|r /'s olle|. bot| |ette|s o|||.e ot
t|e soae t|ae. |s t|e|e o cort|oct o| rot` 'ee Courtess ol Durao|e . /|e\orce|
(830).
3 |r w|ot c||cuastorces w||| t|e posto| occeptorce |u|es rot ope|ote`
4 w|er, |l e.e|, cor or olle|o| wo|.e t|e reec lo| coaaur|cot|or`
Summary
Foi u contiuct to be loimed, tle ucceptunce ol un ollei must be
communicuted. To tlis geneiul iule tleie uie exceptions. Tle most
signilicunt ol tlese exceptions is tle postul ucceptunce iule. Tle
postul ucceptunce iule is, lowevei, sometling ol un unuclionism in
tle modein woild und is unlikely to be extended in lutuie cuses.
|rc|cote w|ot t|e e\cept|ors o|e to t|e recess|t, ol coaaur|cot|r t|e
occeptorce.
/rsor, pp. 43-47.
|ucsor, /. (9oo) '|et|oct|or ol |ette|s ol occeptorce', 82 |0| o9.
Co|cre|, '. (992) '!|os||r w|t| !|o||ope. o cecorst|uct|or ol t|e posto|
|u|es', 2 0I|' 70.
2.6 Methcd cf acceptance
ssentiaI reading
|cKerc||c|, C|opte| 3 '0lle| orc occeptorce' - 3.0 ||esc||cec |et|oc ol
/cceptorce, pp. 4o-47.
|oo|e, C|opte| 2 '/|eeaert 'ect|or 4 C !|e olle|o| p|esc||ces t|e aet|oc
ol occeptorce', pp. 40-4.
J0 ur|.e|s|t, ol |orcor |\te|ro| ||o|oaae
Sometimes un olleioi muy stipulute tlut ucceptunce is to be mude
using u specilic metlod. See: F|idson v Hcnsndw (1819) und
Mdncncsrcr uioccsdn Counci| jor FJucdrion v Commcrcid| dnJ Ccncrd|
lnvcsrmcnrs (1970).
In otlei cuses tle iequiied metlod loi communicuting ucceptunce
muy ulso be inleiied liom tle muking ol tle ollei: see
QucncrJudinc v Co|c (1883).
Tle pioblem tlut uiises is tlis: il tle olleiee uses unotlei metlod
ol ucceptunce, does tlis ucceptunce cieute u contiuct? Tle unswei is
tlut il tle otlei metlod used is no less udvuntugeous to tle olleioi,
tle ucceptunce is good und u contiuct is loimed. Tlis is tle iesult
unless tle olleioi stipulutes u ceituin metlod ol ucceptunce and
luitlei stipulutes tlut only tlis metlod ol ucceptunce is good. See
Mdncncsrcr uioccsdn Counci| jor FJucdrion v Commcrcid| dnJ Ccncrd|
lnvcsrmcnrs (1970).
w|e|e o aet|oc ol occeptorce |os ceer p|esc||cec c, t|e olle|o|.
(o) |o, t|e olle|ee c|oose to use orot|e| (euo||, ellect|.e) aet|oc ol
coaaur|cot|r ||s occeptorce`
(c) w|ot coes euo||, ellect|.e aeor`
(c) w|ose |rte|est s|ou|c p|e.o||`
2 Cor or olle| aoce c, lo\ ce occeptec c, |ette|`
Summary
Il un olleioi intends tlut u ceituin metlod ol ucceptunce is to be
used, le must stipulute tlis metlod and tlut only un ucceptunce
using tlis metlod is to be used. Il le only stipulutes u metlod, un
olleiee cun use unotlei metlod piovided tlut tle otlei metlod is
no less udvuntugeous tlun tle metlod stipuluted.
e\p|o|r w|ot occu|s w|er t|e olle|o| st|pu|otes o ce|to|r aet|oc ol
occeptorce.
/rsor, pp. 50-5.
ur|.e|s|t, ol |orcor |\te|ro| ||o|oaae J1
2.7 1he end cf an unaccepted cffer
ssentiaI reading
|cKerc||c|, C|opte| 3 '0lle| orc occeptorce', 3.3 /cceptorce |r ur||ote|o|
cort|octs to 3.4 !e|a|rot|or ol t|e olle|, pp. 52-55.
|oo|e, C|opte| 2 '/|eeaert 'ect|or 5 |e.ocot|or ol or 0lle|', pp. 5-58.
Olleis do not exist indelinitely, open loi un indeteiminute time
uwuiting ucceptunce. Indeed, some olleis muy nevei be uccepted.
Wlut we will considei ut tle conclusion ol tlis cluptei is wlut
luppens to un ollei beloie it lus been uccepted. Tleie is no legul
commitment until u contiuct lus been concluded by tle ucceptunce
ol un ollei.
2.7.1 Change cf mind
Becuuse tleie is no legul commitment until u contiuct lus been
loimed, eitlei puity muy clunge tleii mind und witldiuw liom
negotiutions. See OjjorJ v udvics (1862) und Rour|cJgc v Crdnr
(1828).
In situutions wleie un olleioi lus stipuluted tlut tle ollei will be
open loi u ceituin time peiiod, le oi sle cun neveitleless witldiuw
tle ollei witlin tlis time peiiod. Tlis will not be tle cuse, lowevei,
wleie tle olleioi is obliged (by u sepuiute binding colluteiul
contiuct) to keep tle ollei open loi u specilied peiiod ol time.
Foi tle ievocution ol un ollei to be ellective, tleie must be uctuul
communicution ol tle ievocution (Byrnc v vdn Ticnnovcn, 1880).
It is not necessuiy loi ievocution to be communicuted by tle
olleioi. Communicution to tle olleiee tliougl u ieliuble souice is
sullicient uiclinson v uoJJs (1876).
Activity 2.9
You| re||cou| olle|s to se|| ,ou |e| co| lo| 0,000. '|e te||s ,ou to 't||r|
ocout |t orc |et ae |row c, |orco,'. 0r 'otu|co,, s|e puts o rote urce| ,ou|
coo| to so, 'lo|et |t - | wort to |eep a, co|'. Cor s|e co t||s` |\p|o|r.
By wlut piocess must tle olleioi ol u uniluteiul contiuct ievoke lis
ollei? Tle pioblem ol un uppiopiiute piocess exists wlen tle ollei
is mude to tle woild. In tlis situution, wlut must tle olleioi do to
uleit 'tle woild'? Englisl luw piovides no unswei to tlis question,
but see Snucy v 0SA (187S).
Il tle olleiee iejects un ollei, it is ut un end. See: HyJc v Wrcncn
(1840).
Dilleient pioblems uiise wlen it is tle olleiee wlo clunges lis oi
lei mind: loi exumple, il ultei posting u lettei ol ucceptunce, tle
olleiee inloims tle olleioi by teleplone, beloie tle lettei uiiives,
JZ ur|.e|s|t, ol |orcor |\te|ro| ||o|oaae
tlut tley ieject tle ollei. Slould tle uct ol posting un ucceptunce
pievuil ovei tle inloimution uctuully conveyed to tle olleioi? In tle
ubsence ol Englisl cuses tle books ielei to u numbei ol cuses liom
otlei juiisdictions see uunmorc v A|cxdnJcr (1830) (Scotlund)
und Wcnlncim v ArnJr (1873) (New Zeulund) but wlen citing
tlem, it is impoitunt to emplusise tlut tley uie not binding und
indeed luve veiy little peisuusive uutloiity. Tle question must
tleieloie be unsweied piimuiily us u muttei ol piinciple. Tieitel
suggests tlut 'tle issue is wletlei tle olleioi would be unjustly
piejudiced by ullowing tle olleiee to iely on tle subsequent
ievocution' (p. 27).
2.7.2 If a ccnditicn in the cffer is nct
fuIfiIIed, the cffer terminates
Wleie tle ollei is mude subject to u condition wlicl is not lullilled,
tle ollei teiminutes. Tle condition muy be implied. See: lindncings
lrJ v Srimson (1962).
In tlis cuse, tle olleioi puipoited to uccept un ollei to puicluse u
cui ultei tle cui lud been budly dumuged.
2.7.3 eath: if the cffercr dies, the cffer
may Iapse
Aguin, u point on wlicl tle cuses divide. On tle one lund,
BrdJoury v Morgdn (1862) 1S8 ER 877 (Ex) leld tlut tle deceused
olleioi's estute wus liuble on tle ollei ol u guuiuntee ultei tle deutl
ol tle olleioi. Howevei, ooircr Jicrd in uiclinson v uoJJs (1876)
stute tlut deutl ol eitlei puity teiminuted tle ollei becuuse tleie
could be no ugieement. Tle best view is piobubly tlut u puity
cunnot uccept un ollei once notilied ol tle deutl ol tle olleioi but
tlut in ceituin ciicumstunces tle ollei could be uccepted in
ignoiunce ol deutl. Tle deutl ol un olleiee piobubly teiminutes tle
ollei in tlut tle olleiee's peisonul iepiesentutives could not puipoit
to uccept tle ollei.
2.7.4 Lapse cf an cffer
Tle olleioi muy set u time limit loi ucceptunce; once tlis time lus
pussed tle ollei lupses. In muny cuses, tle olleioi cun ievoke tle
ollei beloie tle time peiiod lupses piovided tlut tle ollei lus not
been uccepted. See: OjjorJ v udvics (1862).
In cuses in wlicl no time peiiod is stipuluted loi tle ollei, un
olleiee cunnot muke un olleioi wuit loievei. Tle olleioi is entitled
to ussume tlut ucceptunce will be mude witlin u ieusonuble time
peiiod oi not ut ull. Wlut u ieusonuble time peiiod is will depend
upon tle ciicumstunces ol tle cuse. See: Rdmsgdrc \icrorid Horc| v
Monrcjiorc (1866).
w|, cor t|e olle|o| c|eo| ||s o| |e| p|oa|se to |eep t|e olle| oper lo| o stotec
t|ae`
2 |r o ur||ote|o| cort|oct w||c| |s occeptec c, pe|lo|aorce, w|er |os t|e olle|ee
sto|tec to pe|lo|a t|e oct (so os to p|e.ert |e.ocot|or c, t|e olle|o|)` Does t|e
olle|o| reec to |row ol t|e pe|lo|aorce`
ur|.e|s|t, ol |orcor |\te|ro| ||o|oaae JJ
3 |ow cor t|e olle|o| |rlo|a o|| potert|o| c|o|aorts t|ot t|e olle| ol o |ewo|c |os
ceer corce||ec`
4 w||| t|e|e ce o cort|oct |l t|e olle|ee posts o |ette| |eject|r t|e olle| cut t|er
|rlo|as t|e olle|o| c, te|ep|ore, celo|e t|e |ette| o|||.es, t|ot |e occepts t|e
olle|`
5 w|ot |s t|e pu|pose ol |ap|,|r t|ot t|e olle| |s sucject to o corc|t|or`
Summary
Until un ollei is uccepted, tleie is no legul commitment upon eitlei
puity. Up until ucceptunce, eitlei puity muy clunge tleii mind. An
olleioi muy ievoke un ollei oi un olleiee muy ieject un ollei.
An unuccepted ollei expiies eitlei:
ut tle end ol uny time peiiod stipuluted
oi witlin u ieusonuble time peiiod wleie no time peiiod is
stipuluted.
An ollei will lupse wleie it is mude on un unlullilled condition.
An ollei may lupse wlen tle olleioi dies.
b, t||s stoe ,ou s|ou|c ce oc|e to oc||e.e t|e lo||ow|r |eo|r|r outcoaes.
stote w|ot |oppers to or olle| w||c| |s rot occeptec
|||ust|ote w|er or olle| e\p||es.
/rsor, pp. 52-o.
xaminaticn advice
!|e ceto||ec |u|es ol olle| orc occeptorce p|o.|ce o |eoc, sou|ce ol p|oc|eas orc
c|ll|cu|t|es or w||c| or |\oa|re| cor c|ow. 'oae e\oap|es ol t|ese o|e.
|s o po|t|cu|o| stoteaert or olle| o| or |r.|tot|or to t|eot`
|s t|e|e o courte|olle| o| |s |t ae|e|, or eru||,`
w|er coes o postec occeptorce lo|| outs|ce t|e posto| |u|e`
wos t|e olle|o| o| olle|ee l|ee to |o.e secorc t|ou|ts`
w|er |s o te|ep|ore co|| |eco|cec or or orswe||r aoc||re octuo||,
|ece|.ec`
w|er |s or eao|| |ece|.ec`
!|e|e o|e o|so se.e|o| e.e|,co, t|orsoct|ors w|e|e t|e p|ec|se cort|octuo|
oro|,s|s |s rot |aaec|ote|, oppo|ert - t|e aoto||st l||||r up w|t| pet|o| (os),
t|e possere| ||c|r or o cus, t|e tou||st cu,|r o t|c|et lo| t|e urce||ourc
(sucwo,) l|oa o aoc||re orc so or. !|e loct t|ot soae ol t|ese p|oc|eas o|e rot
co.e|ec c, out|o||t, coes rot ao|e t|ea or, |ess ott|oct|.e to or e\oa|re| -
|rceec, t|e oppos|te a||t we|| ce t|e cose. !|e |e, to aost p|oc|eas ol olle|
orc occeptorce |s t|e |ceo t|ot t|e |ow s|ou|c |.e ellect to octuo|
coaaur|cot|or w|e|e.e| poss|c|e.
SampIe examinaticn questicns
uestion 1 /||ce w|ote to b||| olle||r to se|| ||a o c|oc| ol s|o|es |r utop|o |tc.
|r |e| |ette|, w||c| o|||.ec or !uesco,, /||ce os|ec b||| to '|et ae |row c, re\t
'otu|co,'. 0r !|u|sco, b||| postec o |ep|, occept|r t|e olle|. /t o pa or |||co,
|e c|orec ||s a|rc orc te|ep|orec /||ce. /||ce wos rot t|e|e cut |e| te|ep|ore
orswe||r aoc||re |eco|cec b|||'s aessoe stot|r t|ot |e w|s|ec to w|t|c|ow
||s occeptorce.
0r |orco, /||ce operec b|||'s |ette|, w||c| o|||.ec t|ot ao|r|r, orc t|er
p|o,ec coc| t|e aessoe or t|e aoc||re.
/c.|se /||ce.
uestion 2 C,|||, o stoap ceo|e|, |oc o |o|e |e|u.|or 5 cert c|ue lo| so|e. |e
w|ote to Do.|ro, o co||ecto| w|o spec|o||ses |r |e|u.|or stoaps, os||r w|et|e|
s|e wou|c ce |rte|estec |r pu|c|os|r |t. Do.|ro w|ote |r |ep|,, '| oa w||||r to
po, 500 lo| t|e c|ue, | w||| cors|ce| |t a|re ot t|ot p||ce ur|ess | |eo| to t|e
cort|o|, l|oa ,ou orc w||| co||ect |t l|oa ,ou| s|op or |||co, re\t wee|.'
/c.|se Do.|ro os to t|e |eo| pos|t|or.
(o) |l C,||| c|s|eo|cec Do.|ro's |ette| orc so|c t|e stoap to |||c lo| o00
(c) |l C,||| put t|e stoap or ore s|ce |r or er.e|ope ao||ec ''o|c to Do.|ro' cut
Do.|ro cec|cec t|ot s|e ro |ore| w|s|ec to cu, |t.
Advice on answering the questions
Questlon 1 It is impoitunt to bieuk tle question down into its
constituent issues. You uie consideiing eucl ol tlese issues witl u
view to deteimining wletlei oi not u contiuct lus been loimed. Bill
will uigue tlut le is not obliged to puicluse tle sluies becuuse no
contiuct lus been loimed.
Tle issues uie:
(u) Wlut is tle ellect ol Alice wiiting to Bill to ollei to sell lim
sluies?
(b) Wlut is tle ellect ol Alice's stipulution us to tle time tle ollei is
open?
(c) Wlut is tle ellect ol Bill's posting u ieply?
(d) Wlut is tle ellect ol Bill's clunge ol mind? Is tleie ellective
communicution wlen u messuge is lelt on un unsweiing mucline?
(e) Wlicl ol Bill's two communicutions is deteiminutive?
Wlen tle issues uie listed in tlis loim it is uppuient tlut tle biggest
issue is wletlei oi not u contiuct lus been loimed. Tlis is
dependent upon wletlei Alice's ollei lus been uccepted. Tlis, in
tuin, depends upon wletlei Bill lus communicuted lis ucceptunce
oi lis iejection.
We will exumine tlese issues in tuin.
(u) Alice's lettei uppeuis to be un ollei witlin tle ciiteiiu ol Cioson
v Mdncncsrcr Ciry Counci| und Srorcr v Mdncncsrcr Ciry Counci|. You
slould outline tlese ciiteiiu und upply tlem to tle lucts
sometimes tle designution ol un 'ollei' in u pioblem question oi in
eveiyduy lile tuins out not to be un ollei in tle legul sense.
ur|.e|s|t, ol |orcor |\te|ro| ||o|oaae J
(b) Alice's stipulution tlut tle ollei is open loi one week is not
binding (upply tle ciiteiiu in OjjorJ v udvics) unless tleie is u
sepuiute binding contiuct to lold tle ollei open. Tleie does not
uppeui to be sucl u sepuiute binding ugieement.
(c) Becuuse Bill posts lis lettei ol ucceptunce, we need to considei
wletlei oi not tle postul ucceptunce iules upply. Considei tle
ciiteiiu in Houscno|J lirc lnsurdncc v Crdnr. Does tle cuse upply
leie? In tle ciicumstunces, it piobubly does. Alice lus initiuted
communicutions by post und tlus piobubly contemplutes tlut Bill
will iespond by post. In tlese ciicumstunces, tle ucceptunce is good
wlen Bill posts tle lettei it is ut tlis point tlut u contiuct is
loimed. It does not muttei tlut tle lettei does not uiiive until
Monduy (ut wlicl point tle ollei will luve expiied, given Alice's
stipulution us to tle time peiiod).
A possible countei uigument to tlis is tlut Alice usked Bill to let lei
know by Sutuiduy und tlis 'let me know' meuns tlut tleie must
be uctuul knowledge ol lis ucceptunce tlut it must ieully be
communicuted. Tlis necessity loi uctuul communicution meuns tlut
Bill's ucceptunce is not good until Monduy wlen Alice uctuully
opens tle lettei. To upply tlis countei uigument, one needs to
considei tle ciiteiiu set out in Ho|wc|| Sccurirics v Hugncs. One
miglt ulso note tlut since tlut decision, couits uie ieluctunt to
extend tle umbit ol tle postul ucceptunce iule.
(d) Bill clunges lis mind. Heie tleie is no uutloiity us to tle ellect
ol lis clunge ol mind. In uddition, given tle two possible positions
in point (c) ubove, two possible outcomes exist. Il tle postul
ucceptunce iules upply, tlen u contiuct lus been loimed und Bill's
lutei clunge ol mind cunnot upset tlis uiiungement. Howevei, tlis
seems u somewlut ubsuid iesult since Alice leuins ulmost
simultuneously ol tle ucceptunce und tle iejection. Bill lus
uttempted to ieject tle ollei by u quickei loim ol communicution
tlun tle post. In tlese ciicumstunces, you could upply tle
ieusoning ol uunmorc v A|cxdnJcr und stute tlut no contiuct lus
been loimed between tle puities. In uddition, given tle
ieseivutions ol tle couit in Ho|wc|| Sccurirics v Hugncs, it seems
impiobuble tlut u couit would iely upon tle postul ucceptunce iule,
un unpopului exception to tle necessity loi communicution, to
pioduce un ubsuid iesult. Tle second possible outcome leie is tlut
tle postul ucceptunce iules nevei upplied und no contiuct could be
loimed until Alice opened tle lettei. Since sle ieceived tle
iejection ut ulmost tle sume time, sle is no woise oll (see ieusoning
ubove) by not luving u contiuct. You miglt ulso wisl to considei
tle upplicution ol tle iules loi instuntuneous communicutions in
Fnrorcs v Mi|cs ldr Fdsr Corp und Brinlioon v Srdndg Srdn|. Slould
tle communicution mude by teleplone be deemed to luve been tle
liist ieceived? Il so, tleie is no contiuct.
(e) Tlis is ieully tle unswei to tle question. Foi tle ieusons stuted
ubove, tle iejection slould be deteiminutive. Accoidingly, no
contiuct uiises in tlis situution und Bill is not obllged to buy tle
sluies in Utopiu Ltd.

J ur|.e|s|t, ol |orcor |\te|ro| ||o|oaae
Questlon 2 Note ut tle outset tlut in two-puit questions sucl us
tlis you must unswei both puits (unless instiucted cleuily tlut
cundidutes uie to unswei elther u oi b).
Aguin, youi uppioucl slould be to bieuk down tle question into its
constituent puits:
(u) Tle ellect ol Cyiil's lettei is it un ollei oi un invitution to
tieut?
(b) Tle ellect ol Duvinu's lettei is it un ucceptunce? Does tle
postul ucceptunce iule upply? Is Duvinu's lettei u stutement ol
intention?
(c) Is Duvinu's lettei un ollei? Cun sle wuive tle necessity loi tle
communicution ol tle ucceptunce?
By consideiing tlese issues, you cun deteimine wletlei u contiuct
lus been loimed oi not. Witl iespect to puit (u), il u contiuct lus
been loimed, tlen Cyiil is in bieucl ol tlis contiuct wlen le sells
tle stump to Eiic. You need to considei wletlei Cyiil lus mude un
ollei lus le exlibited u willingness to commit on ceituin teims
witlin Srorcr v Mdncncsrcr Ciry Counci| (1974)? Oi is lis
communicution un invitution to tieut oi u step in tle negotiution ol
u contiuct? Il lis lettei is un ollei, it seems ieusonuble tlut le
expects un ucceptunce by post und tle postul ucceptunce iules will
upply: Houscno|J lirc lnsurdncc v Crdnr (1879). On bulunce, it
seems unlikely tlut lis lettei is un ollei it is pliused in teims tlut
seek to elicit inloimution und not to be binding upon luitlei
coiiespondence liom Duvinu. Duvinu muy luve mude un ollei und
wuived tle necessity loi luitlei communicution see lc|rnousc v
BinJ|cy (1862). It is, lowevei, possible tlut eitlei Duvinu nevei
mude un ollei to buy tle stump (sle wus meiely giving un
indicution ol lei top piice) oi tlut Cyiil nevei uccepted tle ollei. In
tlese ciicumstunces, no contiuct lus been loimed witl Duvinu und
Cyiil is liee to sell tle stump.
Witl ieguid to puit (b), il Duvinu lus (und cun, given tle luw in
tlis uieu see lc|rnousc v BinJ|cy (1862)) mude un ollei, tlen Cyiil
lus (il possible) uccepted tle ollei wlen le tukes tle step ol setting
uside tle stump. In tlese ciicumstunces, u contiuct lus been loimed
und Duvinu is obliged to buy tle stump. Tleie uie, lowevei,
signilicunt weuknesses in ieucling tlis conclusion piimuiily tlut
sle seems to be indicuting tle top piice sle would puy loi tle
stump und tlut lollowing lc|rnousc v BinJ|cy (1862) sle cunnot
wuive tle necessity loi communicution ol tle ucceptunce.
ur|.e|s|t, ol |orcor |\te|ro| ||o|oaae J
feedback to activities: Chapter 2
Actlvlty 2.1 Tle gioceiy slop lus not mude you un ollei. Tley
luve mude un invitution to tieut. See Crdingcr 8 Son v Cougn
(1896) und PdrrriJgc v CrirrcnJcn (1968). Tle ieuson tlut tley
luve only mude un invitution to tieut und not un ollei is becuuse il
tle stutement in tle leullet is constiued us un ollei, tlen tle slop
would be bound to sell to eveiyone wlo piesented tlemselves ut
tle slop. Cleuily, tlis is impiucticul und, indeed, muy be
impossible. Consequently, il you visit tle slop, tley do not need to
sell you oiunges ut tlis piice.
Tle ollei cun be mude by uction oi by stutement. See Trcnrndm lrJ
v Arcnird| luxjcr (1993).
Actlvlty 2.2 In Cdr|i||`s cuse tle udveitisei wus udveitising tle
ollei ol u uniluteiul contiuct und not u biluteiul contiuct. Only one
puity would be bound liom tle outset.
Actlvlty 2.3 Tle ieusoning belind tle decision is cleuily
inlluenced by tle consensus tleoiy ol contiuct. Note tle ieleience
by Higgins J to Anson's tleoiies ol consent.
Actlvlty 2.4 Il Cluike lud been u widow, tle cuse would be
dilleient loi two ieusons. Fiist, Cluike would uppeui to be u moie
'deseiving' cluimunt und tle couit miglt luve u luidei time
dismissing lei cluim. Second, tle cuse, on tle lucts ol it, uppeuis to
be mucl moie similui to Wi||idms v CdrwdrJinc. Wlut is necessuiy
loi u contiuct to be loimed, lowevei, on tle busis ol tle iutio ol
Cluike's cuse is tlut Cluike is ussenting to tle ollei tlut tleie is u
'meeting ol minds'. It is not cleui tlut tle widow is uwuie ol tle
ollei und tlut sle ucts to loim tle iequisite consensus.
Actlvlty 2.5 A lus olleied tle goods loi sule tle iequisite
intention to be bound is piesent. B's initiul coiiespondence cun be
tuken us u iejection but it is moie likely to be u iequest loi
inloimution und tle ollei suivives. B's lux is good wlen it is
communicuted piobubly instuntly. Tle lux, lowevei, udds u
condition und tle communicution is not tlus un unquulilied consent
to A's ollei. On bulunce, tlis piobubly opeiutes us u conditionul
ollei wlicl lus tle ellect ol destioying tle oiiginul ollei. Tleie is,
tlus, no contiuct. Even il tleie is u contiuct, tle contiuct will not
include tle deliveiy piice (unless sucl u teim cun be implied by
ieuson ol tle couise ol deuling between tlese puities oi by ieuson
ol tle custom ol tlis industiy).
Actlvlty 2.6 A contiuct lus been loimed; see, loi exumple, Bur|cr
Mdcninc Too| Co lrJ v Fx-Cc||-O Corpordrion (Fng|dnJ) lrJ. Il tle
sellei luils to delivei tle goods, tley uie in bieucl ol tle contiuct.
Actlvlty 2.7 Il youi 'ollei' umounts to un ollei in luw uccoiding to
tle uutloiities set out ubove in 2.1, tleie lus been un ucceptunce ol
youi ollei. Tle ucceptunce lus been by uct, iutlei tlun by wiiting
oi by discussion. Youi ollei lus been uccepted by conduct. Tle
oiunges luve been desputcled in iesponse to youi iequest loi tlem.
Actlvlty 2.B Possible iules include consideiution ol tle lollowing
mutteis:
(u) Does tle sendei know, oi luve tle meuns ol knowing, il tle
communicution lus not been ieceived?
(b) How quickly will tle sendei know il tle communicution lus not
been ieceived?
(c) Wlicl puity, il uny, uccepted tle iisk ol using tlis loim ol
communicution?
(d) Hus tle communicution been sent to uiiive duiing noimul
business louis?
Actlvlty 2.9 Youi neiglboui is liee to witldiuw lei ollei. Tle
ollei is not u contiuct und tleie is notling wlicl binds lei to keep
tle ollei open until Monduy. Autloiity loi tlis pioposition cun be
seen in tle cuse ol OjjorJ v udvics (1862). In tlis cuse, tle
delendunt undeitook to guuiuntee ceituin debts ol unotlei puity loi
u peiiod ol u yeui. Beloie uny bills weie due, und witlin tle yeui,
tle delendunt cuncelled tle guuiuntee. Tle Couit leld tlut us tle
ollei wus not binding, it could be ievoked ut uny time piioi to tle
otlei puity ucting upon it. Tle time limit cieuted no extiu liubilities
but meiely stipuluted u peiiod ut wlicl liubilities will delinitely
come to un end.
Speciul pioblems uiise wleie tle olleioi lus mude un ollei ol u
uniluteiul contiuct wlicl is uccepted tliougl peiloimunce. Heie,
tle ievocution is moie dillicult. Tle Englisl uutloiities uie divided
us to wletlei oi not tlis is possible. In luxor (Fdsroournc) lrJ v
Coopcr (1940) tle House ol Loids ullowed un olleioi to ievoke its
ollei once tle olleiee lud peiloimed tle uct stipuluted. Tle bettei
view is, lowevei, tlut once tle uct ol ucceptunce lus begun tle
olleioi cunnot ievoke tle ollei us long us peiloimunce is ongoing.
See Frringron v Frringron (19S2). It wus expluined in udu|id v lour
Mi||odnl Nominccs (1978) tlut in tlese ciicumstunces tleie must
be un implied obligution on tle puit ol tle olleioi not to pievent
tle condition liom becoming sutislied, und tlis obligution must
uiise us soon us tle olleiee stuits to peiloim tle uct ol ucceptunce.
Once tlis peiloimunce lud begun, tle olleioi could not ievoke lis
ollei.
J9
Chapler 3 Cousideraliou
Ccntents
Intrcducticn 39
3.1 Ccnsideraticn 40
3.2 Frcmisscry estcppeI 48
Intrcducticn
Tle concept ol 'consideiution' is tle piincipul wuy in wlicl Englisl
couits decide wletlei un ugieement tlut lus iesulted liom tle
exclunge ol ollei und ucceptunce (us expluined in Cluptei 2)
slould be legully enloiceuble. It is only wleie tleie is un element
ol mutuulity ubout tle exclunge, witl sometling being given by
eucl side, tlut u piomise to peiloim will be enloiced. A piomise to
muke u gilt will not geneiully be tieuted us legully binding. One
wuy ol ieguiding consideiution is us un indicution ol tle luct tlut
tle puities intended tleii ugieement to be legully binding, tlougl
in some cuses tle couits ulso upply u sepuiute test ol 'intention to
cieute legul ielutions', us discussed in Cluptei 4. Tle doctiine ol
consideiution, wlile still centiul to tle Englisl luw ol contiuct, lus
been upplied witl some llexibility in iecent yeuis. Tleie is ulso u
signilicunt exception to it, bused uiound tle concept ol 'ieusonuble
ieliunce', und usuully ieleiied to us tle doctiine ol 'piomissoiy
estoppel'. Tlis upplies muinly to tle vuiiution ol existing legul
obligutions.
Learning cutccmes
stote t|e essert|o| e|eaerts ol t|e corcept ol 'cors|ce|ot|or'
e\p|o|r t|e s|r|l|corce ol cors|ce|ot|or to t|e |r||s| |ow ol cort|oct
|.e e\oap|es ol t|e t,pes ol ce|o.|ou| w||c| t|e cou|ts w|||, o| w||| rot,
t|eot os .o||c cors|ce|ot|or
cesc||ce t|e s|tuot|ors w|e|e t|e pe|lo|aorce ol, o| p|oa|se to pe|lo|a, or

e\|st|r oc||ot|or w||| oaourt to cors|ce|ot|or lo| o l|es| p|oa|se
cel|re 'post cors|ce|ot|or'
e\p|o|r t|e |o|e ol cors|ce|ot|or |r t|e aoc|l|cot|or ol e\|st|r cort|octs
stote t|e essert|o| e|eaerts ol t|e coct||re ol 'p|oa|sso|, estoppe|'
e\p|o|r |ow t|e coct||re ol p|oa|sso|, estoppe| |eocs to t|e erlo|ceaert ol

soae p|oa|ses w||c| o|e rot suppo|tec c, cors|ce|ot|or.
40
3.1 Ccnsideraticn
ssentiaI reading
|cKerc||c|, C|opte| 5. 'Cors|ce|ot|or orc lo|a' - 5. |eu||eaerts ol

lo|a to 5.2 !|e |o|e ol cors|ce|ot|or, pp. 77-.
|oo|e, C|opte| 4. 'Cors|ce|ot|or, p|oa|sso|, estoppe| orc lo|a' 'ect|or

Cors|ce|ot|or, pp. 03-30.
Tle lunction ol 'consideiution' is to give wlut McKendiick culls tle
'budge ol enloiceubility' to ugieements. Tlis is puiticuluily
impoitunt wleie tle ugieement involves u piomise to uct in u
puiticului wuy in tle lutuie. In exclunges wleie tleie is un
immediute, simultuneous tiunslei ol, loi exumple, goods loi money
(us in most eveiyduy slop puicluses), tle doctiine ol consideiution
upplies in tleoiy but iuiely cuuses uny piucticul pioblems. It is
wleie somebody suys, loi exumple, 'I will delivei tlese goods next
Tluisduy' oi 'I will puy you L1,000 on 1 Junuuiy' tlut it becomes
impoitunt to decide wletlei tlut piomise is 'suppoited by
consideiution' (tlut is, sometling lus been given oi piomised in
exclunge). A piomise to muke u gilt ut some time in tle lutuie will
only be enloiceuble in Englisl luw il put into u speciul loim, tlut is,
u 'deed'. (Foi tle iequiiements ol u vulid deed, see Luw ol Piopeity
(Miscelluneous Piovisions) Act 1989 iepioduced in Poole, p.
17S). Wleie u piomise loi tle lutuie is not contuined in u deed,
tlen consideiution becomes tle noimul iequiiement ol
enloiceubility.
3.1.1 1he definiticn cf ccnsideraticn
ssentiaI reading
|cKerc||c|, C|opte| 5. 'Cors|ce|ot|or orc lo|a' - 5.2 Cors|ce|ot|or

cel|rec to 5.4 Cors|ce|ot|or orc aot|.e, pp. o2-8o.
|oo|e, C|opte| 4. 'Cors|ce|ot|or, p|oa|sso|, estoppe| orc lo|a 'ect|or /

orc b', pp. 03-05.
Look ut tle tiuditionul delinition ol consideiution us set out in
Curric v Misd(187S), tlut is:
u vuluuble consideiution, in tle sense ol tle luw, muy consist eitlei in
some iiglt, inteiest, piolit oi benelit ucciuing to tle one puity, oi
some loibeuiunce, detiiment, loss ol iesponsibility given, sulleied oi
undeituken by tle otlei.
You will see tlut it is bused uiound tle concept ol u 'benelit' to tle
peison muking tle piomise (tle piomisoi), oi u 'detiiment' to tle
peison to wlom tle piomise is mude (tle piomisee). Eitlei is
sullicient to muke tle piomise enloiceuble, tlougl in muny cuses
botl will be piesent.
Tlis is geneiully quite stiuigltloiwuid wleie one side peiloims its
puit ol tle ugieement. Tlis peiloimunce cun be looked ut us
detiiment to tle puity peiloiming und u benelit to tle otlei puity,
C|opte| 3 Cors|ce|ot|or
41
und tlus pioviding tle consideiution loi tle otlei puity's piomise.
Moie dilliculty uiises wleie tle ugieement is wlolly 'executoiy'
(tlut is, it is mude by un exclunge ol piomises, und neitlei puity
lus yet peiloimed). It is cleui tlut Englisl luw tieuts tle maklng
ol u piomise (us distinct liom its peiloimunce) us cupuble ol being
consideiution see tle stutement ol Loid Dunedin in uun|op
Pncumdric Tyrc Co lrJ v Sc|jriJgc 8 Co lrJ (191S) p. 8SS (quoted by
Poole ut p. 116). Tlus, in u wlolly executoiy contiuct, tle muking
ol tle piomise by eucl side is consideiution loi tle piomise mude
by tle otlei side (so iendeiing botl piomises enloiceuble). Tlis
leuds to u ciicului uigument. A piomise cunnot be u detiiment to
tle peison muking it (oi u benelit to tle peison to wlom it is
mude) unless it is enloiceuble. But it will only be enloiceuble il it
constitutes sucl u detiiment (oi benelit). Foi tlis ieuson it is
peilups bettei to ieguid tle doctiine ol consideiution us simply
iequiiing 'mutuulity' in tle ugieement (tlut is, sometling being
olleied by eucl side to it) iutlei tlun tiying to unulyse it stiictly in
teims ol 'benelits' und 'detiiments'.
Activities 3.1-3.3
3.1 'uppose t|ot / o||ores lo| b to c|eor /'s w|rcows, orc p|oa|ses to po, b
30 lo| t||s wo||. b coes t|e wo||. |ow coes t|e oro|,s|s ol 'cerel|t' orc
'cet||aert' opp|, |r |cert|l,|r t|e cors|ce|ot|or supp||ec c, b lo| /'s p|oa|ses ol
po,aert`
3.2 /s |r , cut t||s t|ae / po,s t|e 30 |aaec|ote|,, orc b p|oa|ses to c|eor
t|e w|rcows re\t !uesco,. w|ot |s t|e cors|ce|ot|or lo| b's p|oa|se`
3.3 /s |r , cut / orc b o||ore lo| t|e w|rcows to ce c|eorec re\t !uesco,,
w|t| / po,|r 30 or coap|et|or ol t|e wo||. 'uppose b coes rot tu|r up or
!uesco,. |s b |r c|eoc| ol cort|oct`
Feedbuck: see puge S4.
3.1.2 Ccnsideraticn must be 'sufficient' but
need nct be 'adequate'
ssentiaI reading
|cKerc||c|, C|opte| 5 'Cors|ce|ot|or orc lo|a' - 5.4 Cors|ce|ot|or orc

|ot|.e to 5.8 |rtor|c|e |etu|rs pp. 85-90.
|oo|e, C|opte| 4 'Cors|ce|ot|or, p|oa|sso|, estoppe| orc lo|a', pp. 05-

08.
Tle iequiiement tlut consideiution must be 'sullicient' meuns tlut
wlut is being put loiwuid must be sometling wlicl tle couits will
iecognise us legully cupuble ol constituting consideiution. Tle luct
tlut it need not be 'udequute' indicutes tlut tle couits uie not
geneiully inteiested in wletlei tleie is u mutcl in value between
wlut is being olleied by eucl puity. Tlus in Tnomds v Tnomds
(1842) tle piomise to puy L1 pei unnum ient wus cleuily
'sullicient' to suppoit tle piomise ol u iiglt to live in u louse: tle
puyment ol, oi piomise to puy, money is ulwuys going to be tieuted
4Z
us being witlin tle cutegoiy ol vulid consideiution. On tle otlei
lund, tle luct tlut L1 pei unnum wus not u commeiciul ient wus
iiielevunt, becuuse tle couits do not concein tlemselves witl
issues ol 'udequucy'.
Considei tle cuse ol Cndppc|| v Ncsr|c (1960) (extiucted in Poole ut
p. 119). You will see tlut Loid Someivell justilies tle couits'
uppioucl to tle issue ol 'udequucy' by ieleience to 'lieedom ol
contiuct': 'A contiucting puity cun stipulute loi wlut consideiution
le clooses'. Tle couits will not inteileie just becuuse it uppeuis
tlut u peison lus mude u bud buiguin. Tle peison muy luve otlei,
undisclosed, ieusons loi uccepting consideiution tlut uppeuis
inudequute. In tle cuse ol Cndppc|| v Ncsr|c tle ieusoning wus
piesumubly tlut tle iequiiement to send in tle woitlless wiuppeis
would encouiuge moie people to buy tle compuny's clocolute.
It is sometimes suggested tlut consideiution will not be sullicient il
it lus no economic vulue. Tlis expluins Wnirc v B|ucrr (18S3) wleie
u son's piomise to stop compluining to lis lutlei ubout tle
distiibution ol tle lutlei's piopeity wus leld to be incupuble ol
umounting to consideiution. But it is dillicult to see tlut tle
wiuppeis in Cndppc|| v Ncsr|c lud uny economic vulue eitlei.
Activities 3.4-3.5
3.4 |eoc t|e cose ol wo|c . b,|oa (95o) (e\t|octec |r |oo|e, p. 27). |cert|l,
t|e cors|ce|ot|or supp||ec c, t|e aot|e|. Does t|e cors|ce|ot|or aeet t|e
|eu||eaert ol |o.|r ecoroa|c .o|ue`
3.5 |eoc t|e cose ol |caorcs . |owsor (2000). w|ot cors|ce|ot|or wos
supp||ec c, t|e pup|| co|||ste|` Does t|e cors|ce|ot|or aeet t|e |eu||eaert ol
|o.|r ecoroa|c .o|ue`
3.1.3 xisting cbIigaticns as gccd
ccnsideraticn
ssentiaI reading
|cKerc||c|, C|opte| 5 'Cors|ce|ot|or orc lo|a' 5.0 |e|lo|aorce ol o Dut,

|aposec c, |ow to 5.5 |o|t, po,aert ol o cect, pp. 9-03.
|oo|e, C|opte| 4, 'Cors|ce|ot|or, p|oa|sso|, estoppe| orc lo|a',

pp. 0-23.
Tleie uie tliee uspects to tlis topic, deuling witl tliee dilleient
types ol existing obligution wlicl muy be uigued to constitute
'consideiution':
1 Obligutions wlicl uiise undei tle luw, independently ol uny
contiuct.
2 Obligutions wlicl uie owed undei u contiuct witl u tliid puity.
3 Obligutions wlicl exist undei u contiuct witl u peison wlo lus
mude u new piomise, loi wlicl tle existing obligution is ulleged to
piovide good consideiution.
4J
Tle tliid situution is essentiully conceined witl tle vuiiution ol
existing contiuctuul obligutions us between tle puities, und tle
extent to wlicl sucl vuiiutions cun become binding.
Tlese tliee situutions will be consideied in tuin. (Note tlut
McKendiick deuls witl tle second und tliid situution in tle ieveise
oidei to tlut udopted leie.)
An exumple ol tle liist type ol situution would be wleie u public
olliciul (sucl us u liieligltei oi u police ollicei) ugiees to cuiiy out
one oi moie ol tleii duties in ietuin loi u piomise ol puyment liom
u membei ol tle public. In tlut situution tle piomise ol puyment
will not geneiully be enloiceuble. Tlis is eitlei becuuse tleie is no
consideiution loi tle piomise (tle public olliciul is only cuiiying
out un existing duty), oi, moie piobubly, becuuse public policy
geneiully suggests tlut tle luw slould not encouiuge tle
oppoitunities loi extoition tlut enloicing sucl u piomise would
cieute.
Wleie, lowevei, tle olliciul does more tlun is iequiied by tle
existing obligution, tlen tle piomise ol puyment wlll be
enloiceuble, us slown by C|dsorool Bros lrJ v C|dmorgdn CC
(192S).
Activities 3.6-3.7
3.6 |r Co|||rs . Cocel|o, (83), w|, wos t|e p|oa|se ol po,aert
urerlo|ceoc|e`
3.7 |r wo|c . b,|oa (95o), w|, wos t|e lot|e|'s p|oa|se erlo|ceoc|e`
Feedbuck: see puge SS.
In tle second type ol situution, wlicl ieguids tle peiloimunce ol,
oi piomise to peiloim, un existing obligution owed undei u contiuct
witl u tliid puity, tle position is mucl moie stiuigltloiwuid, since
tle couits luve consistently tuken tle view tlut tlis cun piovide
good consideiution loi liesl piomise. Tlis is so wletlei tle context
is 'domestic' oi 'commeiciul'. Tlus it lus been upplied to tle
lullilling ol u piomise to muiiy (SndJwc|| v SndJwc|| (1860) sucl
u piomise ut tle time being legully binding), und to tle unlouding
ol goods by u liim ol stevedoies, despite tle luct tlut tle liim wus
ulieudy obliged to cuiiy out tlis woik undei u contiuct witl u tliid
puity (Tnc FurymcJon (197S)). Tle luct tlut tle promlse to
peiloim tle existing obligution, us well us its uctuul peiloimunce,
cun constitute good consideiution wus conliimed by tle Piivy
Council in Pdo On v ldu iu long (1980).
Tle tliid type ol existing obligution tlut owed undei u contiuct
witl tle puity muking tle new piomise is tle most dillicult to
deul witl. Tlis iesults liom tle luct tlut u piinciple wlicl wus
cleui, tlougl impiucticul in some ciicumstunces, lus now been
modilied, but tle extent ol tle modilicution is uncleui. Tleie uie
two puiticului cuses on tlis uieu wlicl it is impoitunt you slould
ieud in lull Sri|l v Myricl (1809) (Poole, p. 117) und Wi||idms v
Rojjcy Bros 8 Nicno||s (Conrrdcrors) lrJ (1991) (Poole, p. 119). Sri|l
v Myricl wus long uccepted us estublisling tle piinciple tlut tle
peiloimunce ol un existing contiuctuul obligution could nevei be
'te.eco|es. coc| wo||e|s w|o |ooc orc
ur|ooc s||ps.
44
good consideiution loi u liesl piomise liom tle peison to wlom
tle obligution wus owed. Tle suilois' contiuct obliged tlem to suil
tle slip buck lome. Tlus in biinging tle slip buck to London tley
weie doing notling moie tlun tley weie ulieudy obliged to do
undei tleii oiiginul contiuct. Tlis could not be good consideiution
loi u piomise ol udditionul wuges.
Activities 3.8-3.9
3.8 w|ot ot|e| e\p|orot|or cor t|e|e ce lo| t|e cec|s|or |r 't||| . |,||c|`
3.9 |ow cor 't||| . |,||c| ce c|st|ru|s|ec l|oa t|e loctuo||, s|a||o| cose ol
|o|t|e, . |orsorc, (857), w|e|e t|e |eco.e|, ol occ|t|oro| po,aerts wos
o||owec`
Tle Couit ol Appeul's decision in Wi||idms v Rojjcy iuised tle
question ol wletlei Sri|l v Myricl could still be suid to be good
luw. Tle pluintill cuipenteis, in completing tle woik on tle lluts,
uppeuied to be doing no moie tlun tley weie ulieudy obliged to do
undei tleii contiuct witl tle delendunts.
Photo::LOOLDPVv5RIIH\%URWKHUV - Twynholme Manslon
{photo | C. MacMlllan 23)
How could tlis constitute consideiution loi tle delendunts' piomise
ol udditionul puyment? Tle upplicution ol Sri|l v Myricl would
point to tle piomise being unenloiceuble.
Yet tle Couit ol Appeul leld tlut tle pluintills slould be uble to
iecovei tle piomised extiu puyments loi tle lluts wlicl tley lud
completed. Tle Couit cume to tlis conclusion by giving
consideiution u widei meuning tlun lud pieviously been tlouglt
4
uppiopiiute. In puiticului, Glidewell LJ pointed to tle 'piucticul
benelits' tlut would be likely to ucciue to tle delendunts liom tleii
piomise ol tle udditionul money tlut is:
ensuiing tlut tle pluintills continued woik, und did not leuve
tle contiuct uncompleted
uvoiding u penulty cluuse wlicl tle delendunts would luve

lud to puy undei tleii contiuct witl tle owneis ol tle block ol
lluts
uvoiding tle tiouble und expense ol linding otlei cuipenteis to

complete tle woik.
Tle pioblem is tlut veiy similui benelits to tlese could be suid to
luve ucciued to tle cuptuin ol tle slip in Sri|l v Myricl. Tle muin
point ol distinction between tle cuses tlen becomes tle luct tlut no
piessuie wus put on tle delendunts in Wi||idms v Rojjcy to muke
tle ollei ol udditionul puyment. In otlei woids, tle ulteinutive
explunution loi tle decision in Sri|l v Myricl, us outlined in tle
leedbuck to Activity 3.8, ubove, is given mucl gieutei signilicunce.
Tle ellect is tlut it will be mucl eusiei in tle lutuie loi tlose wlo
uct in iesponse to u piomise ol extiu puyment, oi some otlei
benelit, by simply doing wlut tley uie ulieudy contiucted to do, to
enloice tlut piomise.
You slould note tlut Glidewell LJ summuiises tle ciicumstunces
wleie, in lis view, tle 'piucticul benelit' uppioucl will upply in six
points (set out in Poole, p. 120), wlicl ielute veiy closely to tle
luctuul situution beloie tle couit und emplusise tle need loi tle
ubsence ol economic duiess oi liuud. Tleie is no ieuson, lowevei,
wly lutei couits slould be iestiicted by tlese 'ciiteiiu' in upplying
tle Wi||idms v Rojjcy uppioucl.
Wi||idms v Rojjcy lus not ullected tle ieluted iule tlut puit
puyment ol u debt cun nevei discluige tle debtoi liom tle
obligution to puy tle bulunce. Tlis iule does not deiive liom Sri|l v
Myricl but liom tle House ol Loids decision in lodlcs v Bccr
(1884). As witl tle geneiul iule ubout existing obligutions, il
sometling extiu is done (loi exumple, puying euily, oi giving goods
iutlei tlun money), tlen tle wlole debt will be discluiged (us
leld in Pinnc|`s Cdsc (1602)). But puyment ol less tlun is due on oi
ultei tle dute loi puyment will nevei piovide consideiution loi u
piomise to loigo tle bulunce. In lodlcs v Bccr tle House ol Loids
leld, witl some ieluctunce, tlut tle implicution ol tle iule in
Pinnc|`s Cdsc wus tlut Mis Beei's piomise to loigo tle inteiest on u
judgment debt, piovided tlut Di Foukes puid oll tle muin debt by
instulments, wus unenloiceuble.
Tlis iule lus been ieguided witl some disluvoui ovei tle pust 100
yeuis, und in some ciicumstunces its ellect cun be uvoided by tle
doctiine ol piomissoiy estoppel (discussed below, ut 3.2). It miglt
luve been tlouglt tlut tle extension ol tle scope ol consideiution
in Wi||idms v Rojjcy would luve piovided tle oppoitunity loi u
ievised view ol lodlcs v Bccr. Altei ull, in muny situutions it muy be
to tle cieditoi's 'piucticul benelit' to get puit ol tle debt, iutlei
tlun to iun tle iisk ol ieceiving notling ut ull. In Rc Sc|ccrmovc
(199S), lowevei, tle Couit ol Appeul leld tlut Wi||idms v Rojjcy
lud no impuct on tle lodlcs v Bccr piinciple. Tlut piinciple lus
ulso subsequently been conliimed by tle Couit ol Appeul in
lcrguson v udvics (1997).
4
Activities 3.10-3.11
3.10 |eoc t|e cose ol |oo|es . bee|, p|ele|oc|, |r t|e |ow |epo|ts - (884) 9
/pp Cos o05, t|ou| e\t|octs oppeo| |r |oo|e, ot p. 43. w||c| ol t|e juces
e\p|essec |e|uctorce to coae to t|e corc|us|or to w||c| t|e, le|t t|e coaaor
|ow (os |rc|cotec c, ||rre|'s cose) courc t|ea` w|ot wos t|e |eosor lo| t||s
|e|uctorce`
3.11 w|, co ,ou t||r| t|ot t|e Cou|t ol /ppeo| |os ceer |e|uctort to o.e|tu|r
t|e cec|s|or |r |oo|es . bee|`
3.1.4 Fast ccnsideraticn
ssentiaI reading
|cKerc||c| C|opte| 5. 'Cors|ce|ot|or orc lo|a' 5.o |e|lo|aorce ol o cut,

|aposec c, cort|oct w|t| o t|||c po|t, to 5.8 |ost cors|ce|ot|or,
pp. 03-07.
|oo|e C|opte| 4, 'Cors|ce|ot|or, p|oa|sso|, estoppe| orc lo|a',

pp. 08-0.
A luitlei iule ubout tle sulliciency ol consideiution stutes tlut
geneiully tle consideiution must be given aIter tle piomise wlicl
it is to muke enloiceuble. A piomise wlicl is given only wlen tle
ulleged consideiution lus been completed is unenloiceuble. Tle
cuse ol Rc McArJ|c (19S1) piovides u good exumple. Tle pluintill
lud cuiiied out woik ieluibisling u louse in wlicl lis biotleis
und sistei lud u beneliciul inteiest. He tlen usked tlem to
contiibute towuids tle costs, wlicl tley ugieed to do. It wus leld
tlut tlis ugieement wus unenloiceuble, becuuse tle piomise to puy
wus unsuppoited by consideiution. Tle only consideiution tlut tle
pluintill could point to wus lis woik on tle louse, but tlis lud
been completed beloie uny piomise ol puyment wus mude. It wus
tleieloie 'pust consideiution' und so not consideiution ut ull.
As witl muny iules ieluting to consideiution, tleie is un exception
to tle iule ubout pust consideiution. Tle ciicumstunces in wlicl u
piomise mude ultei tle ucts constituting tle consideiution will be
enloiceuble weie tloiouglly consideied in Pdo On v ldu iu long
(1979). Loid Scuimun luid down tliee conditions wlicl must be
sutislied il tle exception is to opeiute:
1 Tle uct constituting tle consideiution must luve been done ut tle
piomisoi's iequest. (See, loi exumple, ldmp|cign v Brdirnwdir
(161S)).
2 Tle puities must luve undeistood tlut tle woik wus to be puid
loi in some wuy, eitlei by money oi some otlei benelit. (See, loi
exumple, Rc Cdscy`s Pdrcnrs (1892)).
3 Tle piomise would be legully enloiceuble lud it been mude piioi
to tle ucts constituting tle consideiution.
Tle second ol tlese conditions will be tle most dillicult to
deteimine. Tle couit will need to tuke un objective uppioucl, und
decide wlut ieusonuble puities in tlis situution would luve
expected us ieguids tle question ol wletlei tle woik wus done in
tle cleui unticipution ol puyment.
4
3.12 w|, wos t|e opp|ooc| to|er |r |e Cose,'s |oterts rot opp||ec so os to
o||ow t|e p|o|rt|ll to succeec |r |e |c/|c|e, s|rce |t wos oc.|ous t|ot t|e
|ap|o.eaert wo|| wou|c cerel|t o|| t|ose w|t| o cerel|c|o| |rte|est |r t|e |ouse`
3.13 Ioc| wo||s |rto t|e r||t to coap|ete or |apo|tort |epo|t lo| ||s coss, ||so.
||so |s .e|, p|eosec w|t| t|e |epo|t orc so,s '| |row ,ou'.e wo||ec .e|, |o|c or
t||s. |'|| ao|e su|e t|e|e's or e\t|o 200 |r ,ou| po, ot t|e erc ol t|e aort|'.
Cor Ioc| erlo|ce t||s p|oa|se`
w|ot |s or 'e\ecuto|,' cort|oct`
2 |s t|e pe|lo|aorce ol or e\|st|r oc||ot|or owec to o t|||c po|t, ooc
cors|ce|ot|or`
3 w|ot p||rc|p|e |e|ot|r to cors|ce|ot|or |s t|e |ouse ol |o|cs' cec|s|or |r
|oo|es . bee| out|o||t, lo|`
Summary
Tle doctiine ol consideiution is tle meuns by wlicl Englisl couits
decide wletlei piomises uie enloiceuble. It geneiully iequiies tle
piovision ol some benelit to tle piomisoi, oi some detiiment to tle
piomisee, oi botl. Tle 'vulue' ol tle consideiution is iiielevunt,
lowevei. Tle peiloimunce ol existing obligutions will geneiully not
umount to good consideiution, unless tle obligution is undei u
contiuct witl u tliid puity, oi tle piomisee does moie tlun tle
existing obligution iequiies. Tlis iule is less stiictly upplied
lollowing Wi||idms v Rojjcy.Puit puyment ol u debt cun nevei in
itsell be good consideiution loi u piomise to discluige tle bulunce.
Consideiution must not be 'pust', unless it wus iequested, wus done
in tle mutuul expectution ol puyment, und is otleiwise vulid us
consideiution (Loid Scuimun's tliee conditions).
b, t||s stoe, ,ou s|ou|c ce oc|e to.
stote t|e essert|o| e|eaerts ol t|e corcept ol 'cors|ce|ot|or'
e\p|o|r t|e s|r|l|corce ol cors|ce|ot|or to t|e |r||s| |ow ol cort|oct
|.e e\oap|es ol t|e t,pes ol ce|o.|ou| w||c| t|e cou|ts w|||, o| w||| rot,
t|eot os .o||c cors|ce|ot|or
cesc||ce t|e s|tuot|ors w|e|e t|e pe|lo|aorce ol, o| p|oa|se to pe|lo|a, or

e\|st|r oc||ot|or w||| oaourt to cors|ce|ot|or lo| o l|es| p|oa|se
cel|re 'post cors|ce|ot|or'.

/rsor, pp. 88-.

48
3.2 Frcmisscry estcppeI
ssentiaI reading
|cKerc||c|, C|opte| 5 'Cors|ce|ot|or orc lo|a' - 5.22 |stoppe|, 5.29

Corc|us|or. !|e |utu|e ol Cors|ce|ot|or pp. -28.
|oo|e, C|opte| 4, 'Cors|ce|ot|or, p|oa|sso|, estoppe| orc lo|a 'ect|or 2

||oa|sso|, |stoppe|', pp. 30-54.
3.2.1 1he ccncept cf prcmisscry estcppeI
Tle doctiine ol piomissoiy estoppel is piimuiily conceined witl tle
modilicution ol existing contiucts. Tle position undei tle clussicul
common luw ol contiuct wus tlut sucl modilicution would only be
binding il consideiution wus supplied. Tlus in u contiuct to supply
S0 tons ol giuin pei montl ut L100 pei ton loi S yeuis, il tle buyei
wunted to negotiute u ieduction in tle piice to L90 pei ton, becuuse
ol lulling giuin piices, tlis could only be mude binding il tle buyei
guve sometling in exclunge (loi exumple, ugieeing to contiibute to
tle costs ol tiunspoitution). Alteinutively tle two puities could
ugiee to teiminute tleii oiiginul ugieement entiiely, und entei into
u new one. Tle giving up ol iiglts undei tle liist ugieement by
botl sides would luve sullicient mutuulity ubout it to sutisly tle
doctiine ol consideiution.
Tlese pioceduies uie u cumbeisome wuy ol deuling witl tle not
uncommon situution wleie tle puities to u continuing contiuct
wisl to modily tleii obligutions in tle liglt ol clunged
ciicumstunces. It is not suipiising, tleieloie, tlut tle equituble
doctiine ol piomissoiy estoppel lus developed to supplement tle
common luw iules. Tlis ullows, in ceituin ciicumstunces, piomises
to uccept u modilied peiloimunce ol u contiuct to be binding, even
in tle ubsence ol consideiution.
Tle oiigin ol tle modein doctiine ol piomissoiy estoppel is to be
lound in tle judgment ol Denning J (us le tlen wus) in tle cuse ol
Ccnrrd| lonJon Propcrry Trusr lrJ v Hign Trccs Housc lrJ (1947).
Tlis is u cuse wlicl you slould ieud in lull.
You s|ou|c |eoc Cert|o| |orcor ||ope|t,
!|ust |tc . ||| !|ees |ouse |tc (947) |r
lu||.
49
Photo: Hlgh Trees House {photo | C. MacMlllan 23)
Tle lucts ol tle cuse conceined tle modilicution ol tle ient puyuble
on u block ol lluts duiing tle Second Woild Wui. Tle impoitunce ol
tle cuse, lowevei, lies in tle stutement ol piinciple wlicl Denning
set out to tle ellect tlut 'u piomise intended to be binding,
intended to be ucted on, und in luct ucted on, is binding so lui us its
teims piopeily upply'. Applying tlis piinciple, Denning leld tlut u
piomise to uccept u lowei ient duiing tle wui yeuis wus binding on
tle lundloid, despite tle luct tlut tle tenunt lud supplied no
consideiution loi it.
Tle common luw iecognises tle concept ol 'estoppel by
iepiesentution'. Sucl un estoppel only uiises, lowevei, in ielution
to u stutement ol existing luct, iutlei tlun u piomise us to lutuie
uction: see JorJcn v Moncy (18S4). Tle concept ol 'wuivei' lus been
iecognised by botl tle common luw und equity us u meuns by
wlicl ceituin iiglts cun be suspended, but tlen ievived by
uppiopiiute notice: see, loi exumple, Hiclmdn v Hdyncs (187S),
RicldrJs v Oppcnndim (19S0) und Hugncs v Mcrropo|irdn Rdi|wdy
(1877) (tlis cuse wus tle one on wlicl Denning pluced
consideiuble ieliunce in Hign Trccs). It nevei upplied to situutions
ol puit puyment ol debts, lowevei. Undei tle modein luw tle
concept ol wuivei lus been ellectively subsumed witlin 'piomissoiy
estoppel'.
3.2.2 1he Iimitaticns cn prcmisscry estcppeI
Tle doctiine ol estoppel lus been consideied in u numbei ol
iepoited cuses since 1947, und now lus luiily cleuily delined limits.
Tleie uie live points wlicl must be consideied.
Need Ior exlstlng legal relatlonshlp
It is geneiully, tlougl not univeisully, uccepted tlut piomissoiy
estoppel opeiutes to modily existing legul ielutionslips, iutlei tlun
0
to cieute new ones. Tle muin pioponent ol tle opposite view is
Loid Denning limsell, wlo in FvcnJcn v Cui|JjorJ Ciry lC (197S),
leld tlut piomissoiy estoppel could upply in u situution wleie
tleie uppeuied to be no existing legul ielutionslip ut ull between
tle puities.
Need Ior rellance
At tle leuit ol tle concept ol piomissoiy estoppel is tle luct tlut
tle piomisee lus ielied on tle piomise. It is tlis tlut piovides tle
piincipul justilicution loi enloicing tle piomise. Tle lessees ol tle
piopeity in Hign Trccs lud puid tle ieduced ient in ieliunce on tle
piomise liom tle owneis tlut tlis would be ucceptuble, und lud no
doubt oigunised tle iest ol tleii business on tle busis tlut tley
would not be expected to puy tle lull ient. It would tleieloie luve
been unluii und unieusonuble to luve loiced tlem to comply witl
tle oiiginul teims ol tleii contiuct. It lus sometimes been
suggested tlut tlis ieliunce must be 'detiimentul', but Denning
consistently iejected tlis view (see, loi exumple, W J A|dn 8 Co v F|
Ndsr (1972)), und it now seems to be uccepted tlut ieliunce itsell is
sullicient.
A 'shleld not a sword'
Tlis is ieluted to tle liist point (conceining tle need loi un existing
ielutionslip). Tle pliuse deiives liom tle cuse ol Comoc v Comoc
(19S1). A wile wus tiying to sue lei loimei lusbund loi u piomise
to puy lei muintenunce. Altlougl sle lud piovided no
consideiution loi tlis piomise, ut liist instunce sle succeeded on
tle busis ol piomissoiy estoppel. Tle Couit ol Appeul, lowevei,
including Loid Denning, leld tlut piomissoiy estoppel could not be
used us tle busis ol u cuuse ol uction in tlis wuy. Its piincipul use
wus to piovide piotection loi tle piomisee (us in Hign Trccs
pioviding tle lessees witl piotection uguinst un uction loi tle
puyment ol tle lull ient). As Loid Denning put it: consideiution
'iemuins u cuidinul necessity ol tle loimution ol u contiuct, tlougl
not ol its modilicution oi discluige.'
Must be lnequltable Ior the promlsor to go back on
the promlse
Tle doctiine ol piomissoiy estoppel lus its oiigins in equituble
'wuivei'. It is tlus ieguided us un 'equituble' doctiine. Tle ellect ol
tlis is tlut u judge is not obliged to upply tle piinciple
uutomuticully, us soon us it is pioved tlut tleie wus u piomise
modilying un existing contiuct wlicl lus been ielied on. Tleie is u
iesiduul discietion wleieby tle judge cun decide wletlei it is luii
to ullow tle piomise to be enloiced. Tle wuy tlut tlis is usuully
stuted is tlut it must be inequituble loi tle piomisoi to witldiuw
tle piomise. Wlut does 'inequituble' meun? It will covei situutions
wleie tle piomisee lus extiucted tle piomise by tuking udvuntuge
ol tle piomisoi. Tlis wus tle cuse, loi exumple, in u 8 C Bui|Jcrs v
Rccs (1966) wleie tle piomise ol u liim ol buildeis to uccept puit
puyment us lully discluiging u debt owed loi woik done wus leld
not to give iise to u piomissoiy estoppel, becuuse tle debtoi lud
tuken udvuntuge ol tle luct tlut sle knew tlut tle buildeis weie
despeiute loi cusl. Impiopiiety is not necessuiy, lowevei, us slown
by Tnc Posr Cndscr (1982), wleie tle piomise wus witldiuwn so
quickly tlut tle otlei side lud sulleied no disudvuntuge liom tleii
ieliunce on it. In tlose ciicumstunces it wus not inequituble to ullow
tle piomisoi to escupe liom tle piomise.
1
Doctrlne ls generally suspensory
Wleieus u contiuct modilicution wlicl is suppoited by
consideiution will geneiully be ol peimunent ellect, lusting loi tle
duiution ol tle contiuct, tle sume is not tiue ol piomissoiy
estoppel. Sometimes tle piomise itsell will be time limited. Tlus in
Hign Trccs it wus uccepted tlut tle piomise to tuke tle ieduced ient
wus only to be upplicuble wlile tle Second Woild Wui continued.
Once it cume to un end, tle oiiginul teims ol tle contiuct ievived.
In otlei cuses, tle piomisoi muy be uble to witldiuw tle piomise
by giving ieusonuble notice. Tlis is wlut wus done in Too| Mcrd|
Mdnujdcruring Co lrJ v Tungsrcn F|ccrric Co lrJ (19SS). To tlis
extent, tleieloie, tle doctiine is suspensoiy in its ellect. Wlile it is
in opeiution, lowevei, u piomissoiy estoppel muy extinguisl iiglts,
iutlei tlun deluy tleii enloicement. In botl Hign Trccs und tle
Too| Mcrd| Mdnujdcruring cuse it wus uccepted tlut tle ieduced
puyments mude wlile tle estoppel wus in opeiution stood, und tle
piomisoi could not iecovei tle bulunce tlut would luve been due
undei tle oiiginul contiuct teims.
Where 'promlse' ls prohlblted by leglslatlon
Fvdns v Amicus Hcd|rncdrc lrJ [2003| EWHC 2161, [2003| 4 All
E.R. 903 conceined tle use ol embiyos cieuted by IVF piioi to tle
bieukdown ol tle couple's ielutionslip. Tle mun wisled tle
embiyos to be destioyed, tle womun to luve tle embiyos used.
In tlis context it wus lound, inrcr d|id, tlut tle mun lud not given
sucl ussuiunces to tle womun us to cieute u piomissoiy estoppel
becuuse tle ielevunt legislution ullowed lim to witldiuw lis
consent to tle stoiuge ol tle embiyos ut uny time. Tlis
judgement contuins un impoitunt discussion us to tle cuiient stute
ol piomissoiy estoppel und its possible lutuie development.
3.14 w|, wos Derr|r's stoteaert ol p||rc|p|e |r ||| !|ees seer os suc| o
potert|o||, |oc|co| ce.e|opaert |r t|e |ow`
3.15 Do ,ou t||r| t|ot t|e coct||re ol p|oa|sso|, estoppe| |s st||| reecec, row
t|ot w||||oas . |olle, |os aoce |t auc| ao|e |||e|, t|ot o aoc|l|cot|or ol o
cort|oct w||| ce lourc to ce suppo|tec c, cors|ce|ot|or`
|ow coes 'p|oa|sso|, estoppe|' c|lle| l|oa coaaor |ow estoppe|, orc l|oa
'wo|.e|'`
2 w|ot |s t|e aeor|r ol t|e p||ose 'o s||e|c rot o swo|c' |r t|e corte\t ol
p|oa|sso|, estoppe|`
3 w|ot |apo|tort stoteaert ol p||rc|p|e c|c Derr|r I ao|e |r t|e cose ol
Cert|o| |orcor ||ope|t, !|ust |tc . ||| !|ees |ouse |tc`
Z
Summary
Geneiully tle modilicution ol u contiuct iequiies consideiution in
oidei to be binding. Tle doctiine ol piomissoiy estoppel, lowevei,
piovides tlut in ceituin ciicumstunces u piomise muy be binding
even tlougl it is not suppoited by consideiution. Tle muin use ol
tle doctiine lus been in ielution to tle modilicution ol contiucts,
but it is not cleui wletlei it is limited in tlis wuy. Tle doctiine is
only uvuiluble us u slield, not u swoid; tleie must luve been
ieliunce on tle piomise; it must be inequituble to ullow tle
piomisoi to witldiuw tle piomise; but it muy well be possible to
ievive tle oiiginul teims ol tle contiuct by giving ieusonuble
notice.
b, t||s stoe, ,ou s|ou|c ce oc|e to.
e\p|o|r t|e |o|e ol cors|ce|ot|or |r t|e aoc|l|cot|or ol e\|st|r cort|octs
stote t|e essert|o| e|eaerts ol t|e coct||re ol 'p|oa|sso|, estoppe|'
e\p|o|r |ow t|e coct||re ol p|oa|sso|, estoppe| |eocs to t|e erlo|ceaert ol

soae p|oa|ses w||c| o|e rot suppo|tec c, cors|ce|ot|or.
/rsor, pp. 2-23.

SampIe examinaticn questicn
'|aore owrs l|.e te||ocec |ouses w||c| s|e |s p|orr|r to |ert to stucerts. !|e
|ouses o|| reec coap|ete e|ect||co| |ew|||r celo|e t|e, cor ce |ertec out.
'|aore eroes |ete| to co t||s wo|| cu||r /uust, ot or o.e|o|| cost ol
5,000, po,oc|e or coap|et|or ol t|e wo||. /lte| |ew|||r two ol t|e |ouses
|ete| l|rcs t|ot t|e wo|| |s ao|e c|ll|cu|t t|or e\pectec, cecouse ol t|e oe ol
t|e |ouses. 0r 20 /uust |e te||s '|aore t|ot |e |s us|r ao|e aote||o|s t|or
ort|c|potec, orc t|ot t|e wo|| w||| to|e auc| |ore| t|or |e o|||ro||, t|ou|t.
|e os|s lo| or e\t|o 500 to co.e| t|e cost ol occ|t|oro| aote||o|s. '|aore o|ees
t|ot s|e w||| occ t||s to t|e 5,000. |r occ|t|or, cecouse s|e |s or\|ous t|ot t|e
|ouses s|ou|c ce |eoc, lo| occupot|or celo|e t|e sto|t ol t|e ur|.e|s|t, te|a, s|e
so,s t|ot s|e w||| po, or e\t|o ,000 |l t|e wo|| |s coap|etec c, 5 'epteace|.
|ete| coap|etes t|e wo|| c, 5 'epteace|, cut '|aore so,s t|ot s|e |s row |r
l|rorc|o| c|ll|cu|t|es. '|e os|s |ete| to occept 5,000 |r lu|| sett|eaert ol |e|
occourt. |e |e|uctort|, o|ees, cut |os row c|sco.e|ec t|ot '|aore's l|rorc|o|
p|oc|eas we|e |ess se||ous t|or s|e aoce out, orc w|s|es to |eco.e| t|e
occ|t|oro| ,500 |e wos p|oa|sec.
/c.|se |ete|.
J
Advice on answering the sample examination question
Tlis question is conceined witl tle iole ol consideiution in tle
modilicution ol contiucts, und tle doctiine ol piomissoiy estoppel.
Tleie uie tliee sepuiute issues wlicl you will need to considei:
Wus Simone's piomise to puy tle extiu LS00 u binding

vuiiution ol tle contiuct?
Wus Simone's piomise ol un extiu L1,000 il tle woik is

completed by
1S Septembei u binding vuiiution ol tle contiuct?
Is Petei's piomise to tuke tle LS,000 in lull settlement binding

on lim?
Tle liist two questions involve discussion ol wlut umounts to
consideiution.
Il Petei lus piovided consideiution loi Simone's piomises, tlen le
will be uble to lold lei to tlem. Tle unswei to tle tliid question
will depend to some extent on tle unswei to tle liist two. Il tleie
lus been no binding vuiiution ol tle oiiginul contiuct, tlen Petei is
not entitled to moie tlun LS,000 in uny cuse; il tleie lus been u
binding vuiiution, tlen tle question will uiise us to wletlei le is
piecluded liom iecoveiing tle extiu money becuuse ol tle doctiine
ol piomissoiy estoppel.
As to tle piomised LS00, you will need to considei wletlei tle luct
tlut Petei is buying udditionul muteiiuls is good consideiution loi
tlis piomise. Simone muy uigue tlut it wus implicit in tle oiiginul
contiuct tlut tle cost ol ull muteiiuls needed would be included in
tle LS,000. Tle luct tlut Petei lus mude un undeiestimute is not
lei iesponsibility. Similuily, in ielution to tle piomised extiu
L1,000, is Petei doing uny moie tlun le is contiuctuully obliged to
do, in tlut it seems likely tlut tle oiiginul contiuct wus on tle busis
tlut tle woik wus to be done by tle end ol August? In unsweiing
botl tlese questions you will need to deul witl tle piinciple in Sri|l
v Myricl, und tle ellect on tlis ol Wi||idms v Rojjcy. Tlis will
involve identilying uny 'piucticul benelit' tlut Simone muy luve
guined liom lei piomises. Il sucl u benelit cun be identilied, und
tleie is no suggestion ol impiopei piessuie being upplied by Petei,
tlen tle vuiiutions ol tle contiuct will be binding on Simone.
In ielution to tle tliid issue, ussuming tlut tleie lus been u
binding vuiiution, you will need to decide wletlei lodlcs v Bccr
upplies (in wlicl cuse Petei will be uble to iecovei tle L1,S00), oi
wletlei Simone cun uigue tlut Petei is piecluded liom iecoveiy by
tle doctiine ol piomissoiy estoppel. In ielution to tle luttei issue,
one ol tle mutteis wlicl you will need to considei is wletlei
piomissoiy estoppel cun upply in u situution ol u debt ol tlis kind,
us opposed to money puyuble undei continuing contiucts sucl us
tlose involved in Hign Trccs und Too| Mcrd| Mdnujdcruring v
Tungsrcn F|ccrric. You will ulso need to considei wletlei tle luct
tlut Simone muy luve not been lully tiutllul ubout lei linunciul
position muy muke it 'inequituble' loi lei to iely on piomissoiy
estoppel (cl u 8 C Bui|Jcrs v Rccs).
4
Actlvlty 3.1 You slould luve noted tlut cleuning tle windows is u
benelit to A. It is ulso u detiiment to B (despite tle luct tlut B will
ieceive L30), in tlut B will be expending elloit, und could be using
tle time to do otlei tlings. B's uctions uie tleieloie cleuily
consideiution undei tle Curric v Misd delinition.
Actlvlty 3.2 Tlis is tle ieveise ol situution 1. A's puyment ol tle
L30 is u detiiment to A und u benelit to B. Aguin tlis lits witl
Curric v Misd.
Actlvlty 3.3 B is only in bieucl ol contiuct il A piovided
consideiution loi tle piomise to cleun tle windows on Tuesduy.
Tle only possible consideiution is A's piomise to puy L30. As we
luve seen, tle couits uie piepuied to tieut tle piomise to do
sometling us consideiution. A lus, tleieloie, by piomising to puy
L30, piovided consideiution loi B's piomise to cleun tle windows. B
is tleieloie in bieucl ol contiuct. It is dillicult, lowevei, to lit tlis
witlin tle Curric v Misd delinition ol consideiution, und is bettei
expluined by tle concept ol 'mutuulity' in exclunge. You miglt ulso
luve noted tlut il tle ugieement between A und B wus in tle loim
ol u uni|drcrd| conrrdcr witl A suying 'Il you cleun my windows on
Tuesduy, I will puy you L30', B would not be in bieucl ol contiuct.
Actlvlty 3.4 Denning LJ lound consideiution in tle motlei's
piomise to piovide loi tle clild's upkeep. Tlis cleuily lus economic
vulue, but iuises tle question ol wletlei doing sometling wlicl
tle luw ulieudy obliges you to do cun evei be good consideiution.
Tlis is discussed below, in 3.13. Tle mujoiity ol tle Couit ol
Appeul, lowevei, seems to luve lound consideiution in tle
motlei's piomise to ensuie tlut tle clild wus luppy. Tlis does not
involve unytling ol economic vulue. Cun it be distinguisled liom
Wnirc v B|ucrr? It is dillicult to see low.
Tlis suggests tlut tle iequiiement ol economic vulue muy no
longei be puit ol tle doctiine ol consideiution.
Actlvlty 3.5 Tle Couit ol Appeul lound tlut tle pupil did not
piovide consideiution us ieguids lei pupil mustei, but did do so us
ieguids tle clumbeis. Tlis wus on tle busis tlut tle clumbeis
benelited liom uttiucting tulented pupils wlo miglt become
tenunts und enlunce tle development ol tle clumbeis. As Loid
Binglum put it: 'We tuke tle view tlut pupils sucl us tle cluimunt
piovide consideiution loi tle ollei mude by clumbeis.by ugieeing
to entei into tle close, impoitunt und potentiully veiy pioductive
ielutionslip wlicl pupilluge involves'. Tle economic benelit to tle
clumbeis, il uny, is tleieloie indiiect in tlut in tle lutuie tle
pupil muy become u tenunt und biing udditionul woik to tle
clumbeis, enluncing its ieputution, und incieusing tle income ol
its membeis. Aguin, lowevei, tle couit does not uppeui too
conceined ubout tle issue ol 'economic vulue', und tlis suggests, us
does WdrJ v Byndm, tlut tlis element in tle delinition ol
consideiution lus less impoitunce tlun is sometimes ulleged. You
miglt ulso luve noticed tlut tle pupil could luve uigued tlut sle
wus pioviding consideiution tliougl sulleiing ut leust u sloit-teim
economic detiiment, in tlut sle could luve tuken moie secuie puid
employment elsewleie. Tlis line ol uigument wus not, lowevei,
exploied by tle Couit ol Appeul.

Actlvlty 3.6 Tle pluintill in Co||ins v CoJcjroy, in giving evidence
us u witness in iesponse to u subpoenu, wus only doing lis public
duty. It is cleuily undesiiuble loi witnesses (otlei tlun expeit
witnesses) to be puid loi giving testimony.
Actlvlty 3.7 Tleie uie ut leust two possible unsweis to tlis
question. Tle liist is, us suggested by Loid Denning, tlut tle
peiloimunce ol un existing legul obligution slould be tieuted us
good consideiution, 'so long us tleie is notling in tle tiunsuction
wlicl is contiuiy to tle public inteiest' (see ulso Wi||idms v
Wi||idms (19S7)). Tle moie oitlodox view, wlicl wus tuken by tle
mujoiity in WdrJ v Byndm wus tlut tle motlei lud done moie tlun
lei legul duty in ielution to lei cuie loi lei duugltei (i.e. lollowing
tle sume line us C|dsorool Bros lrJ v C|dmorgdn CC). Tle
implicution is tlut il tle motlei lud done simply wlut tle luw
iequiied lei to do sle would not luve piovided good consideiution.
Tle pioblem witl tle mujoiity view on tle puiticului lucts ol tle
cuse is tlut, us noted ubove, 3.1.2, it is dillicult to see tlut tle
motlei's uctions lud uny economic vulue.
Actlvlty 3.B Tle muin ulteinutive explunution ol Sri|l v Myricl is
tlut it wus bused on tle luct tlut tle piessuie put on tle cuptuin by
tle ciew wus u kind ol extoition. To tlut extent, tle cuse is un euily
exumple ol u type ol 'economic duiess' (loi wlicl, see Cluptei 10).
Tlis wuy ol viewing tle cuse lus become moie uttiuctive since tle
Couit ol Appeul's decision in Wi||idms v Rojjcy, discussed below,
since it uvoids tle potentiul conllict between tle two cuses. Piioi to
tlut, lowevei, tle couits ieguluily tieuted Sri|l v Myricl us being
bused solely upon issues ol consideiution.
Actlvlty 3.9 Tle muin busis loi distinction is tlut in Hdrr|cy v
Ponsonoy tle situution lud become so peiilous us u iesult ol tle
ieduction in tle ciew tlut tle suiviving membeis weie, in
continuing witl tle voyuge, doing moie tlun tleii oiiginul contiuct
would luve obliged tlem to do. Tle cuse is tlus un exumple ol tle
piinciple tlut doing moie tlun youi existing obligution wi|| umount
to good consideiution loi u liesl piomise.
Actlvlty 3.1 You slould luve noted tle speecles ol Loid
Selboine (1884) 9 App Cus 60S, ut p. 613; Loid Bluckbuin, ut p.
622; und Loid Fitzgeiuld, ut p. 630.
Actlvlty 3.11 Tleie uie two muin ieusons wlicl you miglt luve
identilied. Fiist, tleie is tle pioblem tlut lodlcs v Bccr is u decision
ol tle House ol Loids. Tle doctiine ol piecedent does not tleieloie
peimit tle Couit ol Appeul to oveiiule it. A lull ieconsideiution ol
tle cuse will tleieloie luve to uwuit u cuse wlicl is uppeuled to tle
House. Secondly, tle Couit muy well luve been ieluctunt to embuik
on u geneiul ieluxution ol tle iule us to puit puyment ol debts,
becuuse it is u situution wleie tle debtoi muy olten be uble to put
tle cieditoi undei piessuie to uccept sucl un uiiungement, und
sucl piessuie muy go beyond wlut tle couits leel is ucceptuble
see, loi exumple, tle cuse ol u 8 C Bui|Jcrs v Rccs (1966), discussed
below, 3.2.
Actlvlty 3.12 Tle pioblem loi tle pluintill in Rc McArJ|c wus tlut
le ucted by limsell, witlout uny iequest, oi even uppiovul, liom
tle iest ol tle lumily. By contiust in Rc Cdscy`s Pdrcnrs tle owneis
ol tle putents knew tlut tle munugei wus doing tle woik. In Rc
McArJ|c it could not be suid, looking ut tle events objectively, tlut
|o| ceto||ec c|scuss|or ol t||s ospect ol t|e
cose, orc t|e c|lle|erces cetweer t|e
|epo|ts ol t|e cose, see |ut|e|, |,
'Coapce||, |sp|rosse orc t|e so||o|s. te\t
orc corte\t |r t|e coaaor |ow' (999) 9
|eo| 'tuc|es 52o, orc cl |o|||s . wotsor
(79).

ull tle puities unticiputed tlut tle woik would be puid loi, becuuse
ut tle time only tle pluintill knew tlut tle woik wus being done.
Tle sume unswei would be uiiived ut by upplying Loid Scuimun's
test in Pdo On v ldu iu long, since neitlei ol tle liist two ol lis
conditions would be sutislied.
Actlvlty 3.13 Tlis is u situution wleie primd jdcic Lisu's piomise is
unenloiceuble becuuse Juck's woik is 'pust consideiution'. Does tle
exception upply? Piesumubly tle woik wus done ut Lisu's iequest,
so tle liist ol Loid Scuimun's conditions is sutislied. Wus it
unticiputed by botl puities tlut tle woik would be puid loi? Tlis is
moie dillicult loi Juck. Il le lus simply woiked tle extiu louis on
lis own initiutive, tlen lis cluim muy well lull ut tlis point. Tleie
would need to be some evidence tlut Lisu wus uwuie tlut le wus
woiking extiu louis, und peilups evidence ol pust piuctice in
muking 'bonus' puyments in tlis type ol situution. Wlut ubout tle
tliid ol Loid Scuimun's conditions? Would Lisu's piomise be
enloiceuble il it lud been mude in udvunce ol Juck's doing tle
woik? Tle only pioblem loi Juck leie is wletlei wlut le is doing
is simply puit ol lis noimul obligutions us un employee. Il it is tlen
le muy lull loul ol tle iules ubout existing obligutions discussed
ubove. Il, lowevei, le is doing moie tlun lis contiuct ol
employment obliges lim to do, tleie is no ieuson wly tle tliid
condition would not be met.
Actlvlty 3.14 Tleie uie two muin ieusons. Fiist, il tuken ut luce
vulue, tle piinciple seems to deny tle need loi consideiution
ultogetlei. As we slull see, lowevei, lutei cuses luve cluiilied tlut
piomissoiy estoppel only upplies in u limited iunge ol situutions.
Secondly, ultlougl Denning puipoited to be meiely building on tle
concept ol 'wuivei', und Hugncs v Mcrropo|irdn Rdi|wdy (1877) in
puiticului, tlut concept lud nevei been upplied to tle puit puyment
ol debts (wlicl wus ellectively tle situution in Hign Trccs). Piioi to
tlut it lud ulwuys been tlouglt tlut lodlcs v Bccr (wlicl cume
ultei Hugncs, und did not even ielei to it) piecluded tle extension
ol tle concept in tlis wuy.
Actlvlty 3.15 It is tiue tlut tle bioudei view ol consideiution is
likely to ieduce tle need to use piomissoiy estoppel tlougl it is
still not possible to be ceituin low lui tle Wi||idms v Rojjcy
development will be tuken. Tle uieu wleie piomissoiy estoppel
will ceituinly still be iequiied is, lowevei, wleie tle modilicution
ol u contiuct involves tle piomissoi iemitting puit ol u debt (us in
Hign Trccs, in ielution to tle ient). As mude cleui by Rc Sc|ccrmovc,
Wi||idms v Rojjcy lus not ullected tle iule in lodlcs v Bccr. Wleie u
contiuctuul modilicution is ol tlis kind, tleieloie, it will be
necessuiy loi tle piomisee to piovide consideiution, oi estublisl u
piomissoiy estoppel, in oidei to be uble to enloice tle piomise.

Chapler 4 0lher orralive requirereuls.
iuleuliou, cerlaiuly aud corpleleuess
Ccntents
Intrcducticn 57
4.1 1he intenticn tc create IegaI reIaticns 58
4.2 Certainty cf terms and vagueness 61
4.3 A ccmpIete agreement 62
Intrcducticn
We luve exumined muny ol tle busic iequiiements necessuiy loi
tle loimution ol un enloiceuble contiuct: ollei und ucceptunce
(Cluptei 2) und consideiution (Cluptei 3). To tlese iequiiements
we must udd tliee moie. Tlese uie:
1 Tlut tle puities intend to cieute legul ielutions.
2 Tlut tle teims ol tleii ugieement uie ceituin und not vugue.
3 Tlut tleii ugieement is u complete ugieement tlut does not need
luitlei development oi cluiilicution.
Once ull ol tlese iequiiements uie piesent, couits will, in tle
ubsence ol uny vitiuting elements, iecognise un ugieement us un
enloiceuble contiuct. We will exumine eucl ol oui new
iequiiements in tuin.
Learning cutccmes
e\p|o|r w|ot |s aeort c, 'or |rtert|or to c|eote |eo| |e|ot|ors'
stote w|, cou|ts |eu||e or |rtert|or to c|eote |eo| |e|ot|ors
coapo|e coaest|c o|eeaerts orc coaae|c|o| o|eeaerts w|t| |eo|c to

or |rtert|or to c|eote |eo| |e|ot|ors
|||ust|ote t|e aost |apo|tort locto|s |r cete|a|r|r w|et|e| o| rot or

|rtert|or to c|eote |eo| |e|ot|ors e\|sts
e\p|o|r w|ot |s aeort c, 'ce|to|rt, ol te|as'
coapo|e cort|octs w|e|e t|e|e |s ce|to|rt, ol te|as w|t| t|ose w|e|e t|e|e
|s rot
stote w|, cou|ts |eu||e ce|to|rt, ol te|as
p|o.|ce o cos|c stoteaert ol t|e corcept ol '.oueress'
estoc||s| t|e recess|t, lo| l|rc|r o coap|ete o|eeaert

8
urce|storc w|, t|e o|eeaert aust ce coap|ete
p|o.|ce t|e c||cuastorces |r w||c| o cou|t cor 'coap|ete' or o|eeaert.

4.1 1he intenticn tc create IegaI reIaticns
ssentiaI reading
|cKerc||c|, C|opte| o. '|rtert|or to c|eote |eo| |e|ot|ors', pp. 29-37.
|oo|e, C|opte| 5. '|rtert|or to c|eote |eo| |e|ot|ors', pp. 58-79.

In Cluptei 2 we exumined tle impoitunce ol intention in ielution
to un ollei: loi u stutement to be un ollei, it must be mude witl tle
intention tlut it be binding upon ucceptunce. It is ulso essentiul
tlut ull tle puities to un ugieement luve un intention to cieute
legul ielutions. Wlut tlis meuns is tlut tle puities intend tlut legul
consequences uttucl to tleii ugieement. In sloit, tle puities intend
tlut tle ugieement will be binding witl iecouise to some exteinul
udjudicutoi (u couit oi uibitiutoi) loi its enloiceubility. Tle
necessity loi intention is most evident in domestic und sociul
ugieements. Tlese uie ugieements between liiends (loi exumple, A
ugiees to lost tle biidge club ut lei louse il B will biing tle lood
to leed tle club) oi ugieements mude between lumily membeis
(e.g. sistei ugiees witl biotlei tlut sle will not pluy lei iudio
loudly il biotlei will keep lis lumstei secuiely in its cuge). In tlis
context, tleie is geneiully un ollei by one puity, wlicl is uccepted
by tle otlei puity, und suppoited by conslderatlon. So lui, tle
ugieement looks like un enloiceuble contiuct. Tle puities, lowevei,
piobubly do not intend u bieucl ol tle ugieement to iesult in legul
uction. Tleii ugieement lucks un intention to cieute legul ielutions
und is tlus not u contiuct becuuse tley did not intend it to be. Tle
ugieement lus no legul ellect ut ull.
Tiuditionully, tle luw lus distinguisled between domestlc and
soclal ugieements und commerclal ugieements. In tle cuse ol
domestic und sociul ugieements, it is piesumed tlut tleie is not un
intention to cieute legul ielutions. In tle cuse ol commeiciul
ugieements, it is piesumed tlut tleie ls un intention to cieute legul
ielutions.
In eitlei instunce, tle lucts ol tle cuse muy displuce tle
piesumption tle luw would otleiwise muke. Foi exumple, it muy
be tlut wlen neiglboui A ugieed to mow neiglboui B's luwn in
exclunge loi tle upples on B's upple tiee, botl puities intended
tlut tlis ugieement would be legully enloiceuble.
Tle deteiminution ol wletlei oi not tle puities intended to entei
into legully binding ielutions is un objective one und context is ull-
impoitunt. Wlut tlis meuns is tlut tle couits will not exumine tle
stutes ol mind ol tle puities to tle ugieement (u subjective
uppioucl), but will usk wletlei oi not ieusonuble puities to sucl
un ugieement would possess un intention to cieute legul ielutions.
See FJmonJs v ldwson (2000).
Tlis objective uppioucl upplies ieguidless ol wletlei tle
ugieement is u sociul oi domestic one oi u commeiciul one.
C|opte| 4 0t|e| |eu||eaerts
9
5oclal and domestlc agreements
Tle leuding cuse is Bd|jour v Bd|jour (1919). Heie, becuuse tle
lusbund would be woiking oveiseus, le piomised to puy lis wile
un umount ol money eucl montl. Wlen tle puities sepuiuted, tle
wile sued tle lusbund loi tlis montlly umount. Tle couit ielused
to ullow lei uction on tle giounds tlut tle ugieement wus not un
enloiceuble contiuct becuuse, ut tle outset ol tleii ugieement, it
'wus not intended by eitlei puity to be uttended by legul
consequences.' Tle puities did not intend tlut tle ugieement wus
one wlicl could be sued upon. Tle judgment ol Atkin LJ ieully
seems to iest upon public policy uiguments tlut us u muttei ol
policy, domestic ugieements, commonly enteied into, uie outside
tle juiisdiction ol tle couits. His judgment ulso liglliglts u judiciul
concein tlut il sucl ugieements could be litiguted in tle couits, tle
couits would soon be oveiwlelmed by sucl cuses.
Similui ieusoning wus upplied in tle cuse ol Joncs v PdJdvdrron
(1969) to lind tlut tle ugieement between u motlei und lei udult
clild did not cieute u contiuct. See ulso CowdrJ v MlB (1962)
wleie tle couit lound tlut un ugieement to tuke u liiend to woik
in exclunge loi petiol money wus un uiiungement wlicl lucked
contiuctuul intention.
Incieusingly in tle modein woild, domestic uiiungements uie
beginning to tuke on u busis in contiuct luw. Bd|jour v Bd|jour must
be seen us u cuse wlicl estublisles u rebuttable presumptlon
tlut domestic ugieements uie not intended. An exumple ol u
situution in wlicl tle piesumption wus iebutted cun be lound in
tle decision in Mcrrirr v Mcrrirr (1970). In tlis instunce tle spouses
weie ulieudy sepuiuted und tle ugieement wus lound to luve un
intention to cieute legul ielutions. A similui iesult lollowed in udrlc
v Srrour [2003| EWCA Civ 176 us tle couit lound tlut un
ugieement loi clild muintenunce lollowing tle bieukdown ol u
couple's ielutionslip did not luck un intention to cieute legul
ielutions given tle loimulity ol tle lettei noi could it be suid to be
unenloiceuble loi wunt ol consideiution since tle womun lud, in
enteiing tle ugieement, given up stututoiy iiglts to muintenunce.
In uddition, in Simplins v Pdys (19SS) it wus lound tlut tleie wus u
contiuct wleie tliee co-lubitees enteied u competition togetlei.
Activities 4.1-4.4
4.1 !||r| ol t|e |ost t||ee p|oa|ses ,ou |o.e aoce to l||ercs o| loa||,. D|c t|ese
p|oa|ses lo|a o|eeaerts |rtercec os cort|octs` w|, (o| w|, rot)`
4.2 |ow coes '|ap||rs . |o,s c|lle| l|oa Cowo|c . ||b`
4.3 / orc b o|e ao|||ec to eoc| ot|e|. !|e, o|ee t|ot / w||| ao|e o|| t|e
ao|toe po,aerts or t|e ao||to| |oae orc t|ot b w||| po, o|| ot|e| |ouse|o|c
c|||s. !||s o||oreaert co|||es or lo| two ,eo|s w|e|eupor / |eluses to ao|e or,
ao|e ao|toe po,aerts. Cor b sue /`
4.4 / orc b o|e ao|||ec to eoc| ot|e|. !|e, o|ee t|ot / w||| po, o|| t|e
|ouse|o|c e\perses orc t|ot b w||| |eao|r ot |oae to co|e lo| t|e|| c|||c|er.
b sucseuert|, to|es up po|c eap|o,aert outs|ce t|e |oae orc orot|e| pe|sor
co|es lo| t|e c|||c|er. |ust / cort|rue to po, t|e |ouse|o|c e\perses`
/ |ecuttoc|e p|esuapt|or |s o p|esuapt|or
aoce c, cou|ts os to o ce|to|r stote ol locts
urt|| t|e cort|o|, |s p|o.ec.
0
Commerclal agreements
In ielution to commeiciul ugieements, couits will geneiully
piesume tlut un intention to cieute legul ielutions is piesent. See:
Fsso Pcrro|cum lrJ v Commissioncrs oj Cusroms dnJ Fxcisc (1976).
Exceptionully, tle lucts muy dispiove sucl un intention. In u sule ol
lund, ugieements uie noimully mude 'subject to contiuct'; tlis
woiding expiessly displuces uny piesumption ol contiuctuul
intention. In otlei situutions, couits luve lound tlut tle specilic
woiding ol tle ugieement in question displuced uny contiuctuul
intention. See, loi exumple:
A comloit lettei k|cinworr Bcnson lrJ v Md|dysid Mining

Corpordrion BcrndJ (1989).
An lonoui cluuse Rosc dnJ lrdnl Compdny v J.R. Crompron

dnJ Brorncrs lrJ (192S).
In most cuses wleie tle puities deul ut uim's lengtl (i.e. tley luve
no existing ties ol lumily, liiendslip oi coipoiute stiuctuie) tle
couit will lind u contiuctuul intention. See FJmonJs v ldwson
(2000).
Activity 4.5
w|, a||t o coaae|c|o| po|t, rot wort or o|eeaert to ce or erlo|ceoc|e
cort|oct` |s suc| or o|eeaert ol or, p|oct|co| .o|ue`
Summary
Ultimutely, tle question ol contiuctuul intention is one ol luct. Tle
ugieement in question must be cuielully sciutinised to deteimine
tle nutuie ol tle puities' ugieement.
Witlout un intention to cieute legul ielutions, tleie will not be u
contiuct.
!o w|ot e\tert o|e cou|ts e\oa|r|r w|et|e| o| rot t|e po|t|es |rterc to to|e
or, c|spute to o cou|t lo| |eso|ut|or` !o w|ot e\tert o|e t|e cou|ts cete|a|r|r
w|et|e| o| rot t|e o|eeaert |os ce|to|r te|as`
2 /|e cou|ts |rl|uercec c, t|e |e||orce ol ore po|t, upor t|e p|oa|se ol orot|e|
|r cete|a|r|r t|ot o cort|octuo| |rtert|or |s p|esert`
3 |s t|e |eosor|r ol t|e juces |r bo|lou| . bo|lou| orc |sso |et|o|eua .
Coaa|ss|ore|s ol Custoas orc |\c|se cosec or puc||c po||c, cors|ce|ot|ors o| or
t|e |rtert|ors ol t|e po|t|es to t|e o|eeaerts`
4 w|ot locto|s co cou|ts cors|ce| |apo|tort |r reot|.|r cort|octuo| |rtert|or`
/rsor, pp. 70-73.
|ec|e,, '. (985) 'Keep|r cort|oct |r |ts p|oce. bo|lou| . bo|lou| orc t|e
erlo|ceoc|||t, ol |rlo|ao| o|eeaerts', 5 0\lo|c Iou|ro| ol |eo| 'tuc|es
p. 39.
1
4.2 Certainty cf terms and vagueness
ssentiaI reading
|cKerc||c|, C|opte| 4. 'Ce|to|rt, orc o|eeaert a|sto|es' - 4. Ce|to|rt,

to 4.2 \oueress, pp. 59-o5.
|oo|e, C|opte| 3. 'Ce|to|rt, orc o|eeaert a|sto|es - /. \oueress',

pp. 58-o.
An enloiceuble contiuct iequiies ceituinty ol teims. Tlut is to suy,
loi un ugieement to be u contiuct, it must be uppuient wlut tle
teims ol tle contiuct uie. Il un impoitunt teim is not settled, tle
ugieement is not u contiuct.
In Scdmmc|| v Ousron (1941) tle couit lound tlut tle ugieement
wus not enloiceuble becuuse tle teims weie unceituin und iequiied
luitlei ugieement between tle puities. Viscount Muuglum
expluined tlut becuuse tle teims weie unceituin, tleie wus no ieul
ugieement (u conscnsus dJ iJcm) between tle puities. Tle
undeilying iutionule loi tlis uieu ol luw cun be seen in tlut il tle
teims cunnot be deteimined witl ceituinty, tleie is no contiuct loi
tle couit to inteipiet. It is not tle iole ol tle couit to cieute tle
teims ol tle contiuct loi tlis would be to impose u contiuct upon
tle puities.
Activities 4.6-4.7
4.6 You o|ee w|t| / t|ot ,ou w||| cu, o s|||t l|oa /'s suaae| co||ect|or lo| 25
- orc ro s|.e |s spec|l|ec |r ,ou| o|eeaert. |o.e ,ou o cort|oct` |\p|o|r.
4.7 w|ot |s t|e c|lle|erce cetweer t|e cec|s|ors |r ||||os orc 'coaae||` /|e
t|e|e cor.|rc|r |eosors lo| cec|c|r t|ese coses c|lle|ert|,`
In some ciicumstunces, puiticuluily wleie tle puities luve ielied
upon un ugieement, couits will moie ieudily imply oi inlei u teim.
Tlis cun be seen in tle decision in Hi||ds v Arcos (1932). Heie, tle
ugieement lud been ielied upon und tle couit wus uble to inlei tle
intention ol tle puities bused upon tle teims in tleii ugieement
und tle usuge in tle tiude.
It muy be tlut tle ugieement piovides u meclunism, oi muclineiy,
to estublisl tle teim. In sucl u situution, tleie is ceituinty ol teims.
Tlus, il inteiest on u loun is to be set ut 1% ubove tle Bunk ol
Englund's buse iute on u ceituin dute, tlen tlis is u ceituin teim. It
cunnot be stuted ut tle outset ol tle contiuct wlut tle inteiest iute
is, but ceituinty ol teims exists becuuse, on tle ielevunt dute, tle
inteiest iute cun be deteimined by un ugieed meclunism.
Tleie is u dilleience between u teim wlicl is meuningless und u
teim wlicl lus yet to be ugieed. Wleie tle teim is meuningless,
it cun be ignoied, leuving tle contiuct us u wlole enloiceuble. See
Nico|cnc lrJ v SimmonJs (19S3).
consensus ad idem. o|eeaert or
|cert|co| te|as.
Z
Summary
Il tle teims ol un ugieement uie unceituin oi vugue, couits will not
lind u contiuct exists. Couits will not cieute un ugieement between
tle puities. In u numbei ol ciicumstunces, couits will use vuiious
devices to ensuie tlut teims wlicl miglt uppeui unceituin uie in
luct ceituin. It muy be possible to deteimine wlut tle teim is liom
tle usuge in tle tiude. A vugue oi meuningless teim muy be
ignoied.
wou|c or o|eeaert to 'use o|| |eosoroc|e erceo.ou|s' to oc||e.e o ce|to|r
ocject|.e ce erlo|ceoc|e`
2 w|ot o|e t|e o|uaerts |r lo.ou| ol o||ow|r o cou|t to estoc||s| t|e essert|o|
te|as ol or o|eeaert`
/rsor, pp. o-o7.

4.3 A ccmpIete agreement
ssentiaI reading
|cKerc||c|, C|opte| 4. 'Ce|to|rt, orc /|eeaert ||sto|es' - 4.3

|rcoap|eteress, pp. o5-o7.
|oo|e, C|opte| 3. 'Ce|to|rt, orc o|eeaert a|sto|es' - C. |rcoap|eteress,

pp. o2-72.
To cieute un enloiceuble contiuct, puities must ieucl un ugieement
on ull tle mujoi elements ol tleii contiuct. Tle ugieement must, in
otlei woids, be complete. Tleie must be notling lelt outstunding
to be ugieed upon ut u lutei dute. Completeness is un uspect ol
ceituinty ol teims: unless un ugieement is complete, u couit is
unuble to stute witl ceituinty wlut ugieement lus been mude
between tle puities. Il tleie is no ugieement on ull ol tle essentiul
elements ol u buiguin, tleie is no contiuct. Tleie must be un
ugieement on mutteis sucl us piice, eitlei by lixing tle piice oi
estublisling u meclunism to lix tle piice. Wlut is essentiul in u
contiuct will depend upon tle nutuie ol tle contiuct.
Tleie is no sucl tling us un ugieement to ugiee. In Courrncy 8
ldirodirn lrJ v To|dni Brorncrs (Horc|s) lrJ (197S) it wus leld tlut
tleie wus no contiuct wleie tle puities lud simply ugieed to
negotiute. Tleii ugieement wus not enloiceuble us u contiuct.
Tle ieuson loi tlis piobubly lies in tle piucticul consideiution tlut
il tle ugieement is incomplete, it is not loi tle couit to complete
tle ugieement becuuse tle couit would tlen be cieuting, iutlei
tlun inteipieting, tle contiuct.
J
Activities 4.8-4.9
4.8 You| a|||aor |eo.es ,ou o rote to os| |l ,ou wou|c |||e or o|ce| ol c|eoc ot
soae po|rt |r t|e lutu|e. You |ep|, t|ot ,ou wou|c orc ,ou o|ee to po, ||s p||ce
ol pe| |ool. |s ,ou| o|eeaert o cort|oct` w|er w||| t|e c|eoc ce ce||.e|ec`
4.9 You olle| to po, 00,000 lo| o |ouse 'sucject to cort|oct'. /|t|ou| t|e
|ouse |oo|s locu|ous or o l||st .|ew|r, sucseuert |rspect|or ol |t |e.eo|s t|ot |t
sulle|s coc|, l|oa coap. !|e .erco| |rs|sts t|ot ,ou aust cu, t|e |ouse os s|e
|os occeptec ,ou| olle|. |ust ,ou`
In some instunces, legislution oi cuse luw will enuble tle couit to
udd tle necessuiy teim to tle ugieement. An exumple ol tlis cun be
seen in s.1S(2) ol tle Sule ol Goods Act 1979 wlicl piovides tlut
wleie tle piice in u contiuct loi tle sule ol goods lus not been
deteimined tle buyei must puy u ieusonuble piice. Wleie tlis
occuis, tle ugieement cun be completed und un enloiceuble
contiuct exists.
In otlei instunces, wleie tle puities luve ucted in ieliunce upon
wlut otleiwise miglt be consideied to be un incomplete
ugieement, couits luve lound tlut tley weie uble to imply tle
necessuiy teims. Foi exumples ol tlis, see tle decisions in lo|cy v
C|dssiquc Codcncs lrJ (1934) und Bririsn Bdnl jor lorcign TrdJc lrJ
v Novincx lrJ (1949). Tleie uie two dilleient wuys ol iutionulising
wlut couits uie doing in tlese instunces:
tle liist is tlut couits uie piotecting tle puities' ieusonuble

ieliunce upon un ugieement
tle second is tlut, becuuse tle partles luve ielied upon tle
ugieement, it is eusiei to imply witl ceituinty wlut tle puities
would oiiginully luve ugieed upon us tle essentiul teims.
4.10 w|ot e|eaerts |o.e cou|ts lourc essert|o| |r cete|a|r|r w|et|e| t|e
o|eeaert |s coap|ete` w|, o|e t|ese e|eaerts essert|o|`
4.11 |r w|ot |rstorces |o.e cou|ts ceer p|epo|ec to '|ap|,' o| '|rse|t' w|ot
oppeo|s to ce or ot|e|w|se a|ss|r essert|o| e|eaert` w|, wos t|e cou|t
p|epo|ec to co t||s`
Summary
Tle ugieement must contuin ull tle essentiul teims necessuiy to
execute tle ugieement witl ceituinty. Il tle ugieement does not
contuin ull tle necessuiy teims, it will not be un enloiceuble
contiuct. Couits will not cieute tle contiuct between tle puities.
4
0rce t|e po|t|es |o.e ceur to pe|lo|a or o|eeaert, o|e cou|ts corce|rec to
p|otect t|e |e||orce ol t|e po|t|es`
2 |ow co t|e p|e.|ous ceo||rs ol t|e po|t|es o| t|e custoa w|t||r o po|t|cu|o|
t|oce oss|st t|e cou|t` 'ee 'coaae|| . 0ustor (94).
/rsor, pp. o7-70.

xaminaticn advice
!|e aotte|s cors|ce|ec |r t||s c|opte| o|e ur|||e|, to oppeo| os o sepo|ote
uest|or or t|e e\oa|rot|or pope|. !||s coes rot aeor t|ot t|e, o|e rot
|apo|tort. !|e, aust ce p|esert |r o|ce| to lo|a or erlo|ceoc|e cort|oct. !|e
loct t|ot t|e |ow |rs|sts upor t|e|| p|eserce (orc t|e c||cuastorces |r w||c| t|e
|ow 'c|eotes' t|ese e|eaerts) te||s us o |ot ocout t|e corsersuo| rotu|e ol
cort|oct |ow.
|o| e\oa|rot|or pu|poses, |owe.e|, t|e aotte|s co.e|ec |r t||s c|opte| o|e |||e|,
to oppeo| os |ssues |r o |o|e| uest|or |r.o|.|r o c|e| |ssue. You aust t||r|
ocout |ow t|ese sao||e| |ssues l|t w|t||r t|e |o|e| |ssue. !|us, lo| e\oap|e, coes
or |rtert|or to c|eote |eo| |e|ot|ors o|so |rc|cote o |eote| p|oc|ea w|t| t|e
oceuoc, ol cors|ce|ot|or`
w|er ,ou |eoc e\oa|rot|or uest|ors t|ot |ele| to or o|eeaert, c|ec| to see |l
t|e o|eeaert |s coaest|c o| soc|o| |r rotu|e - w||| |rtert|or to c|eote |eo|
|e|ot|ors ce or |ssue |r t|e corte\t ol t|ot uest|or` / po|t, see||r to o.o|c
cort|octuo| ||oc|||t, ao, co so or t|e |ourc t|ot t|e|e wos ro |rtert|or to c|eote
|eo| |e|ot|ors. w|e|e t|e o|eeaert |s cetweer coaae|c|o| po|t|es, cors|ce|
w|et|e| o| rot t|e|e o|e locto|s w||c| c|sp|oce t|e p|esuapt|or ol |rtert|or.
w|t| |espect to 'ce|to|rt,' orc 'coap|eteress', s|tuot|ors w||| o||se w|e|e t|e
wo|cs ao, ce oac|uous. You aust os| ,ou|se|l w|et|e| t||s oac|u|t, c|eotes
o p|oc|ea ol ce|to|rt,, o| poss|c|, o a|sto|e.
/|wo,s c|ec| to ao|e su|e or o|eeaert |s coap|ete. |s t|e|e or,t||r essert|o|
w||c| |eao|rs outstorc|r` |l t|e|e |s, cor o cou|t |ap|, o| |rle| w|ot t||s te|a
s|ou|c ce`
SampIe examinaticn questicn
/ p|oa|ses |e| sor b ,000 pe| aort| |l |e ce|rs ||s er|ree||r stuc|es ot
ur|.e|s|t,. /'s c|ot|e|, C, olle|s b o p|oce |r ||s |ouse |l b p|oa|ses to l|r|s| ||s
stuc|es. b olle|s ||s |||l||erc D 50 pe| aort| |l s|e w||| c||.e ||a to t|e
ur|.e|s|t, eoc| ao|r|r. /|e or, ol t|ese o|eeaerts erlo|ceoc|e`

Advice on answering this question
Tle best uppioucl to un exuminution question ol tlis nutuie is to
bieuk it down into its component puits. Tleie uie tliee ugieements
in question. Considei eucl in tuin. Do not be uliuid to use sub-
leudings to ussist tle cluiity ol youi unswei.
1 Agreement between A and B A is B's motlei und
uutomuticully cieutes un issue ol intention. You slould considei tle
geneiul nutuie ol tle test set out by Loid Atkin in Bd|jour v Bd|jour.
Next, considei tle similui lucts ol Joncs v PdJdvdrron. Witlout some
element to distinguisl it liom Jones, it is likely tlut u couit would
ieucl tle sume outcome. Is sucl un element piesent? Note,
lowevei, tle moie geneiul locus ol intention (us opposed to tle
ielutionslip ol tle puities) in FJmonJs v ldwson.
2 Agreement between C and B C is B's uncle; uguin, intention
to cieute legul ielutions becomes un issue. Howevei, un uncle is one
step iemoved liom u puient oi u spouse und couits miglt moie
ieudily inlei sucl un intention. You need to considei wlut is
estublisled by tle cuses cited ubove in (1). An udditionul pioblem
piesent leie is tlut tle ugieement muy not be ceituin in its teims.
How long cun B stuy in tle louse? Wlut puit ol tle louse cun B
occupy? How does Scdmmc|| v Ousron upply to tlis situution? Tlis
luck ol ceituinty suggests tlut tlis is not u complete ugieement. Is
tleie u wuy loi tle couit to inlei wlut tlese teims (sucl us tle
lengtl ol B's tenuie) uie? See lo|cy v C|dssiquc Codcncs lrJ.
3 Agreement between B and D D is B's giilliiend tle
ugieement tlus occuis witlin u sociul context. In tlis sense, it is
similui to CowdrJ v MlB. Heie, tle House ol Loids lound tlut, in
tle ubsence ol evidence to tle contiuiy, tley would be ieluctunt to
inlei tlut ugieements to tuke one's liiend to woik in exclunge loi
iemuneiution guve iise to u contiuct. Tle ielutionslip lucked
intention neitlei puity contempluted tlut tley weie enteiing into
legul obligutions. Note, lowevei, Loid Cioss's judgment in A|ocrr v
MlB does it piovide u giound loi ullowing tlut tle B/D
uiiungement is u contiuct?

Actlvlty 4.1 You need to considei tle essentiul nutuie ol youi
ugieement to unswei tlis question.
Actlvlty 4.2 In Simplins v Pdys, tle judge linds tlut tleie wus u
'mutuulity in tle ugieement' between tle puities. Tle women
enteied tle contest togetlei in tle expectution tlut slould tley
win, tle winnings would be sluied umongst tlem. Tlis seems to be
sullicient to estublisl un intention to cieute legul ielutions. In
contiust, in CowdrJ v MlB, tle Couit ol Appeul ieguids tle lilt to
woik us u mucl moie iiiegului occuiience: it miglt luppen oi it
miglt not. Consequently, tle ugieement wus ieguided us too
inloimul to demonstiute un intention to cieute legul ielutions.
Actlvlty 4.3 Tle leuding cuses wlicl deul witl ugieements in tle
context ol u lumily uie Bd|jour v Bd|jour und Joncs v PdJdvdrron.
You need to do tliee tlings leie. Fiist, you need to considei wlut
ciiteiiu tle couit estublisled in tlese cuses to deteimine wletlei oi
not un intention to cieute legul ielutions is estublisled. Second, you
need to upply tlese ciiteiiu to tle lucts given. Tliid, you need to
piovide un outcome to youi pioblem.
Actlvlty 4.4 You need to upply tle sume piocess us tlut set out in
ielution to Activity 4.3. Tle puipose ol giving tlis exumple is loi
you to contiust it witl tle exumple in Activity 4.3. Applying tle
ciiteiiu set out ubove, tlis instunce is mucl less likely to give iise to
u contiuct. Tle iequisite intention is most likely lucking ut tle
inception ol tle ugieement. Tle ieuson loi tlis is tlut tle piomises
liom botl A und B uie diiected ut tle cuie ol tleii clildien
linunciully und plysicully. Tlis stiikes ut tle veiy coie ol tle lumily
und, witlout stiong evidence to tle contiuiy, is un uiiungement
wlicl is unlikely to give iise to tle necessuiy intention.
Actlvlty 4.5 Tleie uie muny ieusons wly u commeiciul puity
miglt not wunt un ugieement to be un enloiceuble contiuct. Tle
puities muy be negotiuting und wisl to linulise tleii ugieement ut u
lutei dute. Oi, u puity muy wisl to indicute wlut tleii piesent
intention is, witlout committing tlemselves to u puiticului couise
ol uction.
Actlvlty 4.6 In some ciicumstunces, puiticuluily wleie tle puities
luve ielied upon un ugieement, couits will moie ieudily imply oi
inlei u teim. Tlis cun be seen in tle decision in Hi||ds v Arcos
(1932). Heie, tle ugieement lud been ielied upon und tle couit
wus uble to inlei tle intention ol tle puities bused upon tle teims
in tleii ugieement und tle usuge in tle tiude.
It muy be tlut tle ugieement piovides u meclunism, oi muclineiy,
to estublisl tle teim. In sucl u situution, tleie is ceituinty ol teims.
Tlus, il inteiest on u loun is to be set ut 1% ubove tle Bunk ol
Englund's buse iute on u ceituin dute, tlen tlis is u ceituin teim. It
cunnot be stuted ut tle outset ol tle contiuct wlut tle inteiest iute
is, but ceituinty ol teims exists becuuse, on tle ielevunt dute, tle
inteiest iute cun be deteimined by un ugieed meclunism.
Tleie is u dilleience between u teim wlicl is meuningless und u
teim wlicl lus yet to be ugieed. Wleie tle teim is meuningless, it

cun be ignoied, leuving tle contiuct us u wlole enloiceuble. See
Nico|cnc lrJ v SimmonJs (19S3).
In tlis cuse, it is likely tlut u couit will eitlei imply tlut tle size ol
tle sliit is youi size oi, ulteinutively, lind tlut tlis teim is
meuningless.
Actlvlty 4.7 In Hi||ds, tle ugieement lud ulieudy been ielied upon
by tle puities. In uddition, tle woiding ol tle ugieement mude it
cleui tlut tle puities intended to muke, und believed tlut tley lud
mude u concluded buiguin. Reluted to tlis is tlut in Scdmmc||`s
cuse, tle unceituinty suiiounded tle nutuie ol unotlei ugieement,
tle liie puicluse ugieement, wlicl lud to be enteied into. It wus
not possible to usceituin oi imply tle teims ol tlis ugieement in tle
wuy tlut tle couits could usceituin tle meuning ol tle teim in
Hi||ds`s cuse.
Tle most convincing ieuson loi distinguisling tlese cuses is likely
tlut in Hi||ds`s cuse tle ugieement lud been ielied upon; tlis
indicutes tlut tleie wus sullicient ceituinty piesent to peiloim tle
ugieement.
Actlvlty 4.B You need to deteimine in tlis instunce wletlei you
luve un ugieement to ugiee tlut is to suy you would like to buy
bieud und le would like to sell bieud but tlis muy not be u
contiuct. Aie ull ol tle teims necessuiy loi u contiuct to be piesent?
In tlis cuse, it is not ceituin wlen tle bieud is to be deliveied. Tlut
is to suy, wlen will tle bieud deliveiy stuit iiglt uwuy, next week
oi next montl? A couit muy be uble to imply u teim tlut tle
deliveiy will begin in tle week tle oidei is pluced. A couit will,
lowevei, luve moie tiouble in estublisling low liequently tle
bieud is to be deliveied. Tle couit will not wunt to wiite tle teims
ol tle contiuct between you und youi milkmun.
Actlvlty 4.9 In tlis instunce, you do not luve to buy tle louse.
Tle ollei wus uccepted 'subject to contiuct'. Tleie lus been no
contiuct to puicluse und tleie is, tleieloie, no obligution upon you
to puicluse.
Actlvlty 4.1 It is impossible to compile un exluustive list ol
essentiul teims becuuse wlut is essentiul will depend upon tle
puiticului cuse. Tle lollowing uie suggested by wuy ol guidunce:
(u) tle identity ol tle puities involved; (b) piice oi u meclunism by
wlicl piice cun be deteimined; (c) tle time ut wlicl tle contiuct is
to be peiloimed. Ol tlese, piice is tle most impoitunt piobubly
becuuse u buiguin is tle essence ol u contiuct.
Actlvlty 4.11 You will need to come buck to tlis uieu ultei you
luve ieviewed tle section on implied teims (Cluptei S, section
S.2). Couits will imply teims to give u contiuct ellicucy; tlut is to
suy, to muke it woik. In some instunces tlis cun be done becuuse
legislution ullows it to be done; see, loi exumple, tle Sule ol Goods
Act 1979, s.8. In otlei cuses, it cun be done becuuse tle puities uie
uble to deteimine u meclunism estublisled by tle puities witlin
tle contiuct. In otlei instunces, tle contiuct lus been executed,
tlut is to suy, tle contiuct lus been peiloimed. See, loi exumple,
lo|cy v C|dssiquc Codcncs lrJ (1934) .

8
Nctes

Elements of The Law of Contract

Diunggah oleh

Informasi Dokumen

Judul Asli

Hak Cipta

Format Tersedia

Bagikan dokumen Ini

Bagikan atau Tanam Dokumen

Opsi Berbagi

Apakah menurut Anda dokumen ini bermanfaat?

Apakah konten ini tidak pantas?

Hak Cipta:

Format Tersedia

Elements of The Law of Contract

Diunggah oleh

Hak Cipta:

Format Tersedia

Iementscfthe

||u|e5.. Illustrated London News Picture Library.

ur|.e|s|t, ol |orcor |\te|ro| ||o|oaae

ceaorst|ote o t|o|ou| wo|||r |row|ece ol cort|oct |ow. t|e s,||ocus

urce|storc stotutes. ,ou s|ou|c ce.e|op t|e oc|||t, to |rte|p|et o stotute. |r

|cKerc||c|, |. Cort|oct |ow. (|orcor. |o||o.e |oca|||or, 2003) l|lt|

|oo|e, I. Cosecoo| or Cort|oct |ow. (0\lo|c. 0\lo|c ur|.e|s|t, ||ess, 2003)

beotsor, I. /rsor's |ow ol Cort|oct. (0\lo|c. 0\lo|c ur|.e|s|t, ||ess,

|cKerc||c|, |. Cort|oct - !e\t orc |ote||o|s. (0\lo|c. 0\lo|c ur|.e|s|t,

'a|t|, I.C. 'a|t| 8 !|oaos. / Cosecoo| or Cort|oct. (|orcor. 'weet 8

!|e|te|, C.|. !|e |ow ol Cort|oct. (|orcor. 'weet 8 |o\we||, 2003)

|u|astor, |.|. C|es|||e, ||loot 8 |u|astor's |ow ol Cort|oct. (|orcor.

'tore, |. |oce|r |ow ol Cort|oct. (|orcor. Co.erc|s|, 2002)

|c\eo, |. orc |. Cuape| |eo|r|r |\oa '||||s. (|orcor. b|oc|store ||ess,

b|owr, |. orc /. C|orc|e| b|oc|store's 0 8 / |ow ol Cort|oct. (0\lo|c.

|cKerc||c|, C|opte| 3. '0lle| orc /cceptorce', pp. 3-42.

|oo|e, C|opte| 2. '/|eeaert', pp. 9-40.

Coac||ce |ow Iou|ro|

Iou|ro| ol Cort|oct |ow

|ow 0uo|te||, |e.|ew

||o,c's |o||t|ae orc Coaae|c|o| |ow 0uo|te||,

|oce|r |ow |e.|ew

|ew |ow Iou|ro|.

|ttp.//www.po|||oaert.t|estot|ore|,oll|ce.co.u| - upor w||c| cor ce

|ttp.//www.|aso.o..u|/octs.|ta - w||c| p|o.|ces t|e lu|| te\t ol uK /cts

|ttp.//www.po|||oaert.u|/po|||oaert/s|teaop.|ta - t|e s|teaop lo| t|e

|ttp.//www.|owcoa.o..u| - t|e |ow Coaa|ss|or's wecs|te, t||s p|o.|ces

|ttp.//www.t|et|aes.co.u|/ - w|e|e ,ou cor c|ec| t|e |ow |epo|ts co||,.

Puit II deuls witl tle content ol u contiuct und some ol tle

Puit III deuls witl tle cupucity to contiuct tle emplusis

Puit IV deuls witl vitiuting elements in tle loimution ol u

Puit VI deuls witl illegulity und public policy (Clupteis 12 und

Puit VII deuls witl tle discluige ol u contiuct (Clupteis 14 und

Puit VIII deuls witl iemedies loi u bieucl ol contiuct (Clupteis

iequiiements us to tle loim ol contiucts

guming und wugeiing contiucts

ussignment (including negotiubility)

||eaerts ol t|e |ow ol cort|oct

stote t|e essert|o| e|eaerts ol t|e corcept ol 'cors|ce|ot|or'

e\p|o|r t|e s|r|l|corce ol cors|ce|ot|or to t|e |r||s| |ow ol cort|oct

cesc||ce t|e s|tuot|ors w|e|e t|e pe|lo|aorce ol, o| p|oa|se to pe|lo|a, or

cel|re 'post cors|ce|ot|or'

e\p|o|r t|e |o|e ol cors|ce|ot|or |r t|e aoc|l|cot|or ol e\|st|r cort|octs

stote t|e essert|o| e|eaerts ol t|e coct||re ol 'p|oa|sso|, estoppe|'

e\p|o|r |ow t|e coct||re ol p|oa|sso|, estoppe| |eocs to t|e erlo|ceaert ol

|cKerc||c|, C|opte| 5. 'Cors|ce|ot|or orc lo|a' - 5. |eu||eaerts ol

|oo|e, C|opte| 4. 'Cors|ce|ot|or, p|oa|sso|, estoppe| orc lo|a' 'ect|or

|cKerc||c|, C|opte| 5. 'Cors|ce|ot|or orc lo|a' - 5.2 Cors|ce|ot|or

|oo|e, C|opte| 4. 'Cors|ce|ot|or, p|oa|sso|, estoppe| orc lo|a 'ect|or /

|cKerc||c|, C|opte| 5 'Cors|ce|ot|or orc lo|a' - 5.4 Cors|ce|ot|or orc

|oo|e, C|opte| 4 'Cors|ce|ot|or, p|oa|sso|, estoppe| orc lo|a', pp. 05-

|cKerc||c|, C|opte| 5 'Cors|ce|ot|or orc lo|a' 5.0 |e|lo|aorce ol o Dut,

|oo|e, C|opte| 4, 'Cors|ce|ot|or, p|oa|sso|, estoppe| orc lo|a',

uvoiding u penulty cluuse wlicl tle delendunts would luve

uvoiding tle tiouble und expense ol linding otlei cuipenteis to

|cKerc||c| C|opte| 5. 'Cors|ce|ot|or orc lo|a' 5.o |e|lo|aorce ol o cut,

|oo|e C|opte| 4, 'Cors|ce|ot|or, p|oa|sso|, estoppe| orc lo|a',

stote t|e essert|o| e|eaerts ol t|e corcept ol 'cors|ce|ot|or'

e\p|o|r t|e s|r|l|corce ol cors|ce|ot|or to t|e |r||s| |ow ol cort|oct

cesc||ce t|e s|tuot|ors w|e|e t|e pe|lo|aorce ol, o| p|oa|se to pe|lo|a, or

cel|re 'post cors|ce|ot|or'.

/rsor, pp. 88-.

|cKerc||c|, C|opte| 5 'Cors|ce|ot|or orc lo|a' - 5.22 |stoppe|, 5.29