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Contract Law Principles Explained
Summary
The conversation covers various contract law principles, including the doctrine of privity, which generally prevents third parties from enforcing contracts. Exceptions exist, such as in Trident v McNiece, where third-party beneficiaries in insurance contracts can enforce the contract if they were contemplated by the parties. Promissory estoppel, derived from equity, does not require a written promise and acts as a defense, not a claim. Contracts under seal do not need consideration, unlike typical contracts. In Tweddle v Atkinson, the son could not claim because his father provided the consideration. Legal relations are presumed in commercial agreements, not typically in social or domestic ones. Additionally, paying a debt early can be considered additional consideration, making an agreement binding. Directors are generally not personally liable for company debts unless fraud is involved.Full Conversation
It is presumed the parties intend to create legal relations in
Select one:
a.
Social agreements
b.
Domestic agreements
c.
All agreements
d.
Commercial and business agreements
In legal contexts, it is generally presumed that parties intend to create legal relations in:
d. Commercial and business agreements
This presumption does not typically apply to social or domestic agreements unless there is clear evidence to suggest otherwise.
d. Commercial and business agreements
This presumption does not typically apply to social or domestic agreements unless there is clear evidence to suggest otherwise.
Which of the following is NOT an element of promissory estoppel?
Select one:
a.
The promisee must have acted upon the promise.
b.
It must be inequitable to allow the promisor to go back on the promise.
c.
A clear, unequivocal promise must be made.
d.
The promise must be written.
The element that is NOT required for promissory estoppel is:
d. The promise must be written.
Promissory estoppel does not require the promise to be in writing.
d. The promise must be written.
Promissory estoppel does not require the promise to be in writing.
Promissory estoppel derives from:
Select one:
a.
Common law
b.
History
c.
Statute
d.
Equity
Case Rating: *
Promissory estoppel derives from:
d. Equity
If you have more legal questions or need further clarification, feel free to ask!
Promissory estoppel derives from:
d. Equity
If you have more legal questions or need further clarification, feel free to ask!
What sort of contracts do not need to be supported by consideration?
Select one:
a.
Contracts made under seal
b.
Contracts made in writing
c.
Contracts made in writing that contain an express term saying that no consideration is required
d.
This is a trick question – all contracts must be supported by consideration.
Case Rating: *
The correct answer to the question "What sort of contracts do not need to be supported by consideration?" is:
a. Contracts made under seal
Contracts made under seal are an exception to the general rule that contracts must be supported by consideration. If you have more questions or need further clarification, feel free to ask!
The correct answer to the question "What sort of contracts do not need to be supported by consideration?" is:
a. Contracts made under seal
Contracts made under seal are an exception to the general rule that contracts must be supported by consideration. If you have more questions or need further clarification, feel free to ask!
When the cruise boat comes in there are often fights between bus drivers. The Cruise Tour Operators Association pays extra money to the police to get them to maintain order at the wharf. They pay at the end of each year. One year Cruise Tour Operators Association refuses to pay. Can the police sue for breach of contract?
Select one:
a.
It depends – if providing order at the wharf is going beyond the statutory duty to maintain law and order then the police have provided consideration and can sue for breach of contract.
b.
No – paying the police is encouraging corruption so is an illegal contract.
c.
Yes – there is a clear offer, acceptance, consideration and intention to be bound.
d.
No – the police are already under a statutory duty to maintain law and order so are not providing any consideration.
Case Rating: *
The correct answer to your question is d. No – the police are already under a statutory duty to maintain law and order so are not providing any consideration.
If you have more questions or need further clarification, feel free to ask!
The correct answer to your question is d. No – the police are already under a statutory duty to maintain law and order so are not providing any consideration.
If you have more questions or need further clarification, feel free to ask!
Which case established the doctrine that promissory estoppel can only be used as a shield
Select one:
a.
Foakes v Beer
b.
Waltons v Maher
c.
Central London Property Trust v High Trees House
d.
Combe v Combe
Case Rating: *
The correct answer is:
d. Combe v Combe
This case established the principle that promissory estoppel can only be used as a shield, not a sword. If you have more questions or need further clarification, feel free to ask!
The correct answer is:
d. Combe v Combe
This case established the principle that promissory estoppel can only be used as a shield, not a sword. If you have more questions or need further clarification, feel free to ask!
Sarah works in Joshua's shop as a cashier and is paid $* per hour. Joshua has noticed that Sarah is often very hot and tired and one day tells her that as well as her pay she can have all the Coca-Cola she wants to drink every day from then on. Sarah thanks him. After a couple of weeks Joshua gets angry at Sarah drinking Coca-Cola and tells Sarah he is going to start charging her for the drinks she takes. Can Sarah claim that Joshua is in breach of the contract?
Select one:
a.
No – Sarah provided no consideration for the apparent variation of the contract.
b.
Yes – the Coca-Cola forms part of the consideration that Joshua is providing to Sarah.
c.
No – Joshua can alter the terms of the contract whenever he wants to.
d.
Yes – Joshua varied the terms of the contract and Sarah agreed to this.
Case Rating: *
In this situation, Sarah may argue that Joshua varied the terms of the contract when he offered Coca-Cola as part of her compensation, and she accepted this offer. Therefore, the correct answer is:
d. Yes – Joshua varied the terms of the contract and Sarah agreed to this.
If you have further questions or need more information, feel free to ask!
In this situation, Sarah may argue that Joshua varied the terms of the contract when he offered Coca-Cola as part of her compensation, and she accepted this offer. Therefore, the correct answer is:
d. Yes – Joshua varied the terms of the contract and Sarah agreed to this.
If you have further questions or need more information, feel free to ask!
explain the answere
Case Rating: *
The answers provided are based on legal principles and doctrines:
*. Tweddle v Atkinson: The son could not claim because his father provided the consideration, not him.
*. Legal Relations: Intent is presumed in commercial agreements, not typically in social or domestic ones.
*. Promissory Estoppel: Doesn't require the promise to be written; it's a principle of equity.
*. Contracts Under Seal: These don't need consideration, unlike typical contracts.
*. Police & Cruise Tour Operators: Police can't sue as maintaining law and order is their statutory duty.
*. Promissory Estoppel Case: Established in Combe v Combe, it acts as a defense, not a claim.
*. Sarah's Contract: Joshua offered a contract variation by allowing free drinks, which Sarah accepted, so he's in breach if he changes it.
If you need more details, feel free to ask!
The answers provided are based on legal principles and doctrines:
*. Tweddle v Atkinson: The son could not claim because his father provided the consideration, not him.
*. Legal Relations: Intent is presumed in commercial agreements, not typically in social or domestic ones.
*. Promissory Estoppel: Doesn't require the promise to be written; it's a principle of equity.
*. Contracts Under Seal: These don't need consideration, unlike typical contracts.
*. Police & Cruise Tour Operators: Police can't sue as maintaining law and order is their statutory duty.
*. Promissory Estoppel Case: Established in Combe v Combe, it acts as a defense, not a claim.
*. Sarah's Contract: Joshua offered a contract variation by allowing free drinks, which Sarah accepted, so he's in breach if he changes it.
If you need more details, feel free to ask!
Which of the following is NOT correct:
Select one:
a.
All contracts must be supported by consideration to be enforceable.
b.
Agreements made between husband and wife can be legally binding if the husband and wife intend the agreement to have legal effect.
c.
Agency is an exception to the doctrine of privity of contract.
d.
Consideration must move from the promisee.
Case Rating: *
Option a is NOT correct. Contracts under seal do not require consideration to be enforceable, unlike typical contracts that do.
Option a is NOT correct. Contracts under seal do not require consideration to be enforceable, unlike typical contracts that do.
John owes Charlie $*,*. The debt is due on * December *. John knows Charlie needs money now, so on * July * John offers to pay Charlie $*,* in full and final settlement of the debt. Charlie accepts this and John pays the money. On * December * Charlie comes to see John and asks to be paid the outstanding $*,*. Does John have to pay?
Select one:
a.
Yes- the rule in Pinnel’s case means that an agreement to accept part payment of debt as full and final settlement is unenforceable
b.
No – it would be inequitable to allow Charlie to go back on his word.
c.
Yes- the rule in Foakes v Beer means that an agreement to accept part payment of debt as full and final settlement is unenforceable
d.
No – paying early can be considered to be additional consideration supporting the variation in the original contract.
Case Rating: *
In the scenario provided, the correct answer is:
d. No – paying early can be considered to be additional consideration supporting the variation in the original contract.
Paying a debt early can be seen as valuable consideration, making the agreement binding. If you have more questions about this, feel free to ask!
In the scenario provided, the correct answer is:
d. No – paying early can be considered to be additional consideration supporting the variation in the original contract.
Paying a debt early can be seen as valuable consideration, making the agreement binding. If you have more questions about this, feel free to ask!
In which of the following cases did the court find an intention to create legal relations existed?
Select one:
a.
Reweru v Agigo
b.
Chand v Kumar
c.
Balfour v Balfour
d.
Vave v Walenenea
Case Rating: *
The correct answer is:
b. Chand v Kumar
In this case, the court found that there was an intention to create legal relations. If you have more questions or need further clarification, feel free to ask!
The correct answer is:
b. Chand v Kumar
In this case, the court found that there was an intention to create legal relations. If you have more questions or need further clarification, feel free to ask!
What did the majority in Trident v McNiece decide?
Case Rating: *
In Trident v McNiece, the majority decided that a third party beneficiary could enforce a promise made in an insurance contract, even though they were not a party to the contract. This decision marked a significant departure from the traditional doctrine of privity of contract.
In Trident v McNiece, the majority decided that a third party beneficiary could enforce a promise made in an insurance contract, even though they were not a party to the contract. This decision marked a significant departure from the traditional doctrine of privity of contract.
What did the majority in Trident v McNiece decide?
Select one:
a.
Promissory estoppel was used to give third party beneficiaries to insurance contracts a remedy, as they were prevented from suing by the doctrine of privity of contract.
b.
Privity of contract prevents third party beneficiaries from suing to enforce insurance contracts.
c.
Third party beneficiaries in insurance contracts are parties to the contract.
d.
In insurance policies if third parties were in the contemplation of the parties to the contract then those third parties can enforce the contract.
Case Rating: *
In Trident v McNiece, the majority decided:
d. In insurance policies, if third parties were in the contemplation of the parties to the contract, then those third parties can enforce the contract.
In Trident v McNiece, the majority decided:
d. In insurance policies, if third parties were in the contemplation of the parties to the contract, then those third parties can enforce the contract.
Peter was the Company Director and sole shareholder of XYZ Ltd. XYZ Ltd entered into a contract with Simon to supply * motorbikes. Peter signed the contract as the Company Director. Simon paid his money. XYZ Ltd then filed for bankruptcy and no longer exists. Simon did not get his money returned and did not get his motorbikes. Can he sue Peter for breach of contract?
Case Rating: *
Simon may face challenges in suing Peter for breach of contract because Peter signed the contract on behalf of XYZ Ltd, not in his personal capacity. Generally, directors are not personally liable for company debts unless there are grounds like fraud or personal guarantees.
To assist further, could you provide any evidence that Peter personally guaranteed the contract, or that there was any fraudulent activity involved?
Simon may face challenges in suing Peter for breach of contract because Peter signed the contract on behalf of XYZ Ltd, not in his personal capacity. Generally, directors are not personally liable for company debts unless there are grounds like fraud or personal guarantees.
To assist further, could you provide any evidence that Peter personally guaranteed the contract, or that there was any fraudulent activity involved?
Peter was the Company Director and sole shareholder of XYZ Ltd. XYZ Ltd entered into a contract with Simon to supply * motorbikes. Peter signed the contract as the Company Director. Simon paid his money. XYZ Ltd then filed for bankruptcy and no longer exists. Simon did not get his money returned and did not get his motorbikes. Can he sue Peter for breach of contract?
Select one:
a.
It depends – if Peter was the agent for XYZ Ltd then Peter can be sued as agency agreements are an exception to the doctrine of privity of contract.
b.
No – XYZ Ltd and Simon were the parties to the contract. Peter was not a party to the contract so cannot be sued.
c.
Yes – Peter signed the contract with Peter so is a party to the contract.
d.
It depends – companies are separate legal entities that can enter contracts on their own behalf. If however, a company has been used to disguise some sort of fraud the court can “lift the corporate veil”.
Case Rating: *
In this scenario, the correct choice is:
d. It depends – companies are separate legal entities that can enter contracts on their own behalf. If, however, a company has been used to disguise some sort of fraud, the court can “lift the corporate veil.”
If there's evidence of fraud or personal guarantees, Simon might pursue legal action against Peter. If you have more details or questions, feel free to ask!
In this scenario, the correct choice is:
d. It depends – companies are separate legal entities that can enter contracts on their own behalf. If, however, a company has been used to disguise some sort of fraud, the court can “lift the corporate veil.”
If there's evidence of fraud or personal guarantees, Simon might pursue legal action against Peter. If you have more details or questions, feel free to ask!
What did Emery v Hashimoto establish?
Select one:
a.
In Solomon Islands there needs to be a prior existing legal relationship in order to be able to successfully use promissory estoppel.
b.
In Vanuatu there needs to be a prior existing legal relationship in order to be able to successfully use promissory estoppel.
c.
In Fiji promissory estoppel can be used as a sword.
d.
In Tonga promissory estoppel can be used as a sword.
Case Rating: *
Emery v Hashimoto established that in the Solomon Islands, there needs to be a prior existing legal relationship in order to be able to successfully use promissory estoppel. The correct answer is:
a. In Solomon Islands there needs to be a prior existing legal relationship in order to be able to successfully use promissory estoppel.
Emery v Hashimoto established that in the Solomon Islands, there needs to be a prior existing legal relationship in order to be able to successfully use promissory estoppel. The correct answer is:
a. In Solomon Islands there needs to be a prior existing legal relationship in order to be able to successfully use promissory estoppel.
In January Sam borrowed Alice’s car while she went overseas. He did some repairs on Alice’s car. Alice had not asked for this work to be done. In February Sam and Alice enter into an oral contract that Alice will pay Sam $* and in return he will fix her car – but all the work has already been done. Alice does not pay Sam. Can Sam sure for breach of contract?
Select one:
a.
Yes – Alice is estopped from going back on her promise to pay Sam
b.
Yes – there is a clear offer, acceptance and consideration
c.
No – the contract was not supported by consideration as the car had already been fixed at the time the contract was entered into
d.
Yes – Alice is estopped from going back on her promise to pay Sam
Case Rating: *
Option c is correct: No – the contract was not supported by consideration as the car had already been fixed at the time the contract was entered into. In contract law, consideration must be present for a contract to be enforceable, and past consideration is generally not valid.
Option c is correct: No – the contract was not supported by consideration as the car had already been fixed at the time the contract was entered into. In contract law, consideration must be present for a contract to be enforceable, and past consideration is generally not valid.
According to the doctrine of privity of contract, which of the following is NOT correct:
Select one:
a.
If a contract creates benefit for a third person who is not a party to the contract, the third person can sue to enforce the contract.
b.
A contract cannot bind persons who are not a party to it.
c.
Only parties to the contract can sue or be sued on it.
d.
A contract binds only parties to it.
Case Rating: *
The correct answer is: a. If a contract creates benefit for a third person who is not a party to the contract, the third person can sue to enforce the contract. In the traditional doctrine of privity, a third party typically cannot enforce a contract.
The correct answer is: a. If a contract creates benefit for a third person who is not a party to the contract, the third person can sue to enforce the contract. In the traditional doctrine of privity, a third party typically cannot enforce a contract.
It is presumed the parties do not intend to create legal relations in
Select one:
a.
Commercial agreements
b.
Social and domestic agreements
c.
Business agreements
d.
All agreements
Case Rating: *
In legal contexts, it is generally presumed that parties do not intend to create legal relations in social and domestic agreements unless there is clear evidence otherwise. Do you have a specific legal issue related to this topic that I can help with?
In legal contexts, it is generally presumed that parties do not intend to create legal relations in social and domestic agreements unless there is clear evidence otherwise. Do you have a specific legal issue related to this topic that I can help with?
According to the doctrine of privity of contract, which of the following is NOT correct:
Select one:
a.
If a contract creates benefit for a third person who is not a party to the contract, the third person can sue to enforce the contract.
b.
A contract cannot bind persons who are not a party to it.
c.
Only parties to the contract can sue or be sued on it.
d.
A contract binds only parties to it.
Case Rating: *
The correct answer is: a. If a contract creates benefit for a third person who is not a party to the contract, the third person can sue to enforce the contract. This statement is not correct under the traditional doctrine of privity, which holds that only parties to a contract can enforce it.
The correct answer is: a. If a contract creates benefit for a third person who is not a party to the contract, the third person can sue to enforce the contract. This statement is not correct under the traditional doctrine of privity, which holds that only parties to a contract can enforce it.
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