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CONTRACT LAW - Consideration and legal intent
Domestic/social situations, commercial or business.
Terms in this set (25)
LI - What is the definition of legal intent?
LI - Intent to create a legal relationship
LI - If an agreement is made in a social or domestic situation then the law will presume...
LI - that there is no legal intent
LI - If an agreement is made in a commercial or business situation then the law will presume...
LI - that there is legal intent
LI - When might agreements between family members (domestic) contain legal intent?
LI - If a large amount of money is involved or someone's financial security is at risk there may be an LI
LI - Name the case that was held there was no LI as it was a domestic deal
LI - Balfour v Balfour - Mr B promised to pay wife £30/a month while abroad for work. He didn't. No contract as a domestic agreement.
LI - Name the case that was held there was an LI as it was involving financial security
LI - Merritt v Merritt - Mr M deserted wife and agreed to pay mortgage which he never did. Held: was LI as parties were separated when the agreement was made and involved wife's financial security.
LI - Name the case that was held there was no LI as it was a domestic arrangement despite the daughter's security being at risk
LI - Jones v Padavatton - A mother bought a house for her daughter to live in while she was studying. They had an argument and the mother tried to evict the daughter. The daughter claimed she had an enforceable contract. Held: there was no LI as it was a domestic agreement even though the daughter's security was at risk.
LI - Agreements between friends and neighbours are unlikely to have LI. However,
if a large amount of money is involved, or financial security is put at risk then there may be LI.
LI - Case of social agreement with a large prize creating the LI
LI - Simpkins v Pays - Lodger and landlady entered a competition in lodger's name and the landlady paid the fee. The lodger did not share the £600 winnings as agreed. Held: although it was a social agreement the passing of money and the large prize created legal intent so the winnings had to be shared.
LI - A social agreement with an LI as financial security had already been given up
LI - Parker v Clarke - A young couple agreed to sell their home and move in/take care of an older couple [friends]. In return the older couple agreed to leave them their home in their wills. An argument followed and the older couple tried to evict the younger couple. Held: was LI as the younger couple gave up financial security by selling their home.
LI - An arrangement made in a business situation is presumed to have LI. However...
LI - if there is evidence that shows a different intent, then there may not be LI.
LI - What is an example of a business agreement term that would mean it is not with LI?
LI - If the agreement contains a clear term that says the agreement is not legally binding, there may be no LI (honour pledge clause).
LI - A commercial case in which there was LI as profit was gained from the promotion?
LI - Esso v Customs and Excise - Esso gave out free world cup coins with every four gallons of petrol. Customs and Excise wanted to charge tax on the coins so the court had to decide if there was LI in respect of the agreement for the coins. Held: was LI as Esso wanted profit from the promotion.
LI - A commercial case in which the competition was in a business context so there was an LI?
LI - McGowan v Radio Buxton - A radio station had a competition with the prize of a Renault Clio. M won and was given a model car. Held: the competition was in a business context so had LI. M was entitled to a full size car or compensation.
CS - What is consideration?
CS - "Some right, interest or profit benefiting one party and a loss or responsibility suffered by the other party."
CS - Consideration need not be...
CS - adequate (Thomas v Thomas), but must be sufficient (Chappell v Nestle)
CS - What is the adequacy case?
CS - Thomas v Thomas (dying husband could make a bad deal with wife if he chose to)
CS - What is the sufficience case?
CS - Chappell v Nestle
CS - What are the rules of consideration?
CS - Adequacy, past consideration, sufficiency, 3rd party rights and existing duties.
Existing duty - If one party agrees to perform a duty which they already had to do under contract..
ED - Then that party is giving no valid consideration for the new contract
ED - What happened in case of Stilk v Myrick?
ED - The crew not entitled to extra wages promised as covering for missing crew already a term of their existing contract.
ED - Why might there be a valid second contract?
ED - If more is to be done under this second contract then there may be a validity to it.
ED - What happened in the case of Hartley v Ponsonby?
ED - The crew were entitled to the promised extra wages as covering for 50% of the missing crew was not a term of their existing contract
ED - If a benefit is received by the other party then performing an existing duty may be...
ED - a valid consideration.
ED - What happened in the case of Williams v Roffey?
ED - The roofer was entitled to the extra payment as, even though the roofer was only doing what he had to anyway (finish by a date) as: completing the work meant the builder wouldn't be sued by third party and the roofer completing the job saved the builder organising another roofer.
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