Hi and uh welcome to the final session of contract law. My name is Rina Cherie and I shall be going through the video uh video 11 which is based on the summary of contract law. So I shall be recapping all the sessions we've had so far uh prior to this video. So as always to start off with, let's look at the sqe assessment criteria. Now as a most um you do need to, you will be uh examined and tested on all areas of law. And as I've told you prior, this can be in combination uh with different areas. Therefore, when you are answering your multiple choice question, remember you will need to identify the single best answer. Now, the formation, let's look at we did touch on this prior. So uh each area we touched on, we summarize it as well. Uh So the formation of a contract we should know uh we've got our core elements. So to make a agree, a valid agreement, we do need offer an acceptance. So both together do amount to an agreement and then obviously we've got intention to create legal relations and considerations. So we would need all these core elements to form a valid um contracts. So let's start this. So the law of contract is concerned with legally impossible uh agreements. It is of significance in everyday life since it applies to a great number and variety of transaction. So just to touch on this, a contract is an agreement which is enforceable by law. And the essentials which I've just touched on is an agreement which consists of offer and acceptance consideration and intention to create legal relations. The absence of one of these essentials means that there is no enforceable contract in existence. So the doctrine of privity of contract establishes that generally only a person who is party to the contract can sue or be sued under it. Exception to this rule have been introduced by a statute and case law. But the most crucial exception are those set out in the contracts, right? Rights of third party act 1999 which we have looked at prior. So, so that's everything to do with formation of a contract. So now next, we're going to look at the term of the contract. Now, the the the there could be quite a lot on this, but I will try to touch base on some of them. So to start off with, um let's look at the terms I got contact. So this could include, so we've switched on express terms, uh something so this could be expressed terms, implied terms, etc. Uh So terminology are things like statements they are divided into, um they could be in three different categories. So for example, they could be mere puffs, extravagant claims made for things that are being sold. Uh such as if someone said this tastes tastes sensational, et cetera presentations, which are in general terms, pre contractual statements, which intend to persuade the other party into entering a contract and terms as in which I've just touched on like express terms and implied terms, etc, which are statements incorporated into the contract. So let's have a look at these so express terms. What exactly are they, these are discovered by considering what the parties have said or wrote when they were actually forming this contract to decide whether a statement is an express term. The courts will usually need to establish whether the claim has had notice of the term. It's convenient to consider issues of notice in like two separate situation personally where a written document concerning these contractual terms has been signed. And secondly, when one of the parties attempts to incorporate written terms into an oral contract, it should be noted that most of the cases concerning um notice relate to a pacific time or a type of contractual term known as an exclusion clause. The term attempts to restrict or in some cases completely remove a party's liability in the event of a breach of contract, but it can only be valid if there is a term of the contract. So remember that in some cases, um and the focus upon similar terms often called, called like limitation clauses. These attempts to sort of cap a cap or limit the total amount for which a party might be li be liable for in the event of a breach implied terms. Uh So again, these are sort of read into an agreement rather than written uh from. So some other um source now they are part of that, not because the parties are specifically agreed them, but because the court or the statute has read them into the contract, now, they could be implied in certain ways by statue, by custom or by the courts. The important part is a statue which implies terms into certain types of contracts. Although the law of contract has been established and developed by the common law Parliament has occasionally intervened here. And the main reason for this is to help to protect the consumer and prevent them from being taken advantage of by those that are more experienced in business. So there's a protection there. So terms that are incorporated can be in different ways. So we've got a signature, you could incorporate by a signature. Uh Even if the party did read it up first, if you've signed the document, previous course of dealings, so that we're saying here, the terms must be same. So if you've been dealing with the same supply for the same contract terms must be same in that situation, reasonable notice. So again, what is reasonable depends on the circumstances and this is what the courts will look at. Is it reasonable notice? Etc. So we, we have covered um touch on these cases prior, so I won't go into them. So now again, uh terms, you know, looking at certain terms, um the courts will have a look whether it's a condition of warranty or in nominate term to the contract. So if it is a condition of a contract, that means it goes to the root of the contract. So if there's a failure or a breach in this term, uh then obviously, um the contract can repudiate so that then the con con contract cannot continue. So the remedy for this would be, you know, uh to repudiate and claim damages there a warranty. Now, you could get sort of partially damages and still continue with the contract here. So you can't terminate the contract. Whereas if the term is anominous, is the breach we need to consider, is the breach sufficient or serious enough to um terminate it? Does it deprive party of substantially the whole benefit, et cetera so much the remedy to the breach we're saying here, sometimes it's difficult to decide um whether a term is a no or not. And this is the sort of that what the courts will look at is the breach sufficiently serious or not. And then the court is up to the courts to decide again. We've got case law which we looked at Hong Kong for shipping here. So now we're going to next, we look at vitiating factors uh just to summarize these again. Um So we looked at misrepresentation, we looked at uh mistake on fire, um contract terms, duress and undue influence and illegality. So again, this is the sort of factors that could affect a contract, you know, um that could determine which way a contract is going to turn to. So with the misrepresentation, we did touch on three pointers. So we we switched on innocent neglige and fraudulent misrepresentation. So let's touch base just to summarize on these. A represent to can't be liable for the statement that he had reasonable grounds to make. In other words, and this is for the innocent uh representation. In other words, a represent to can't be liable for a statement where he has not been careless. So that's what the innocent one, the neglige uh misrepresentation. Again, there are two categories of negligence here. In both cases, the represent is honest and believes his statement to be true. The misrepresentation arises because the rep represent has not exercised reasonable care and skill in making the statement. So this is why we're saying he's more been negligent in his misrepresentation. Now, a fraudulent, no, sorry, that was negligent. Yes, fraudulent misrepresentation. This is what the representing must establish that the represent to knew that the statement was false. Firstly, secondly, it did not believe that the statement was true. And thirdly was reckless, not caring whether this statement was true or false. So again, this is what we would look at being fraudulent now, mistake now. But this is vital that the mistake existed at the time of the contract was formed. Otherwise, it will not render a contract void, a mistake that is recognize recognizable at common law with will fall into one of the three categories common where both parties have made the same mistake mutual. When the parties are at cross purposes with each other and unilateral mistake, only one of the parties is mistaken, but the other knows of the mistake. Now we've got here, we next have got the unfair contract terms. This is where a party uses an exemption like exclusion clause to exempt themselves from liability for their breach of contract or some of the legal duty, duress and undue influence. If a person enters into an agreement by improper pressure being put on them, the law may intervene to protect them. So gress in any circumstances, obviously, it's wrongful. So this is where the law may look to intervene and the courts will look at this illegality. An illegal contract is an agreement that is prohibited by statute or is illegal at common law on the grounds of public policy. So, illegality, if you form any sort of illegal contract, you know, there's, there's no rights if someone's breached it there because it was a legal contract. So for example, if he, um, gave b a contract, uh to kill his wife or kidnap his wife, uh for a sum of money and, uh, he killed his wife, but then he decided not to pay. Now, it's a really terrible example, but it's an example of giving you how sort of illegal activities could because that's a criminal offense. It's illegal anyway. Uh, that wouldn't be happening, hopefully. But in this sort of example, there's no breach of contract because the entire contract was illegal. Uh whether party upheld their power or not. Next, we will look at termination here. Obviously, we've got termination. We switched on few parts here like performance, breach of contract agreement and frustration. So I will look at um a few of them in detail. Uh Well, not in detail but summarize them at least. Uh So a contract is discharged usually when it is at the end of uh end and both parties are freed from their obligations. A contract may be discharged in one of the poor ways. So as I've mentioned performance and this is when an entire contract, both parties should fulfill their obligations completely. Although there are certain exceptions to this, including where one party has accepted partial performance. Uh Secondly, the contract has been substantially performed thirdly where one party prevents the other from performing uh or one party has tendered performance. Or finally, the obligation of the contract was severable. A promise as to time of performance may be a vital term, breach of which entitles the other party to treat the contract as it's been repudiated. If this is not the case, it will be viewed as an ominate term and it will be for the court to assess the impact of the breach on the contract. A promise as to time, for example, treat us as vital if parties, if the parties indicate that it is a vital term or the circumstances indicate that it is a vital term. Now, breach of contract, the innocent party may end the contract or claim damages if the term breached is a condition, although only damages can be claimed if the term breached is a warranty agreement. Uh a contract may and be ended by an agreement if neither party has performed their obligations, if one party has performed, but the other party has not. The one, the one who has not performed may be released by the other from his promise only for some additional consideration and this is known as accord and satisfaction. Now frustration a contract. Uh when unforeseen circumstances make performance impossible, the principles are death or illness of one of one of the parties, destruction of a like essential subject matters or um an event fundamental to the contract does not take place, go interference or illegality. A contract is not usually ended by frustration if the parties have anticipated um and provided for the event or if performance simply turns out to be more expensive than expected. Now, the entire effects of frustration are described in the law Reform Act 1943 which to an extent does replace the previous common law rules can be recovered and money originally payable ceases to be so, although both in both cases, the payee may be able to retain or claim some or all of his expenses from the money paid or payable where a valuable benefit has been confirmed before frustration, the court may avoid uh just some in compensation in this case here. Now, then obviously we've looked at um a termination, obviously, remedies goes in quite nicely and next to it, right? Ok. The award of a remedy is usually in general terms, the way in which the court responds or to a breach of contract. The remedies for a breach of contract um are usually as follows damages, a monetary award usually intended to put the injured party in the position. They would have been um had the contract been performed. Damages can be awarded for prey or non prec losses. They are only awarded when and the breach of contract. Um, the breach of contract caused the actual loss. The loss is not too remote as we've seen in the case law of Hadley and Baxendale, the loss could not reasonably have been avoided, usually known as mitigation. Then we've got uh specific performance. This is where a court order telling the party in breach to fulfill his obligation, its discretionary remedy and will not be given if for example, damages would not be adequate. Um, then we've got injunction. This is where the call, um, may order telling a Pacific party to a contract not to do something. The most common sort of example is a promise not to work for anyone else during or within a specified time after leaving, um, their employment. An injunction is another discretionary remedy and will generally not be granted if its effect will be for someone to perform a contract for personal services. And finally, a range of remedies have also been set out within the cr a 2015 in relation to terms implied into contracts for goods, services or digital content. These are available instead of or as well as the more traditional sort of remedies. Now, finally, we will touch on the causation and remoteness if a claim is to be rewarded, uh is to be awarded damages. They must show that any breach of, um there was a breach of contract um that the breach caused the loss um complained of. So there must be a chain there that the loss was not too remote from the breach of contract contract and that they have attempted to mitigate the losses that they are claiming for. Uh remember we saw this in the case of Hadley and Baxendale again, just to remind you, it was held that the defender was not liable because this loss was not reasonably foreseeable and he did not know because the claimant had not told him that there was no spare and the milk could not work without the crumb shaft. Ok. So this is the more sort of a common case that you will come across. And then finally, uh we have completed the entire video sessions of contract law. So we prior we've looked at from video one and this was video 11. So we've summarized contract law. So hopefully you will have a better understanding of contract law as an overall. So I shall leave you uh for now to summarize. Therefore, um from mere shari, it's thank you and bye.
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