Tutorial questions on Law of Contract

1. Hint intention to create legal relationship

1. The husband left his wife. They met to make arrangements for the future. The husband agreed to pay 40 per month maintenance, out of which the wife would pay the mortgage. When the mortgage was paid off he would transfer the house from joint names to the wife's name. He wrote this down and signed the paper, but later refused to transfer the house. HINT --Merrit v Merrit (1970)

2. Mrs Parker was the niece of Mrs Clarke. An agreement was made that the Parkers would sell their house and live with the Clarkes. They would share the bills and the Clarkes would then leave the house to the Parkers. Mrs Clarke wrote to the Parkers giving them the details of expenses and confirming the agreement. The Parkers sold their house and moved in. Mr Clarke changed his will leaving the house to the Parkers. Later the couples fell out and the Parkers were asked to leave. They claimed damages for breach of contract.

HINT -Parker v Clarke (1960) 3. A property developer reached an "understanding" with a firm of solicitors to employ them in connection with a proposed development, but neither side entered into a definite commitment. The property dealer want to sue the firm on after they refused to employ him. HINT- JH Milner v Percy Bilton (1966)

2. Hint misrepresentation of Facts

4. The plaintiff put up his hotel for sale stating that it was let to a 'most desirable tenant'. The defendants agreed to buy the hotel. The tenant was bankrupt. As a result, the defendants refused to complete the contract and were sued by the plaintiff for specific performance. Smith v Land & House Property Corp (1884) 28 Ch D 7

5. The plaintiff farmer asked the manager of the defendant, who was a trainer of racehorses, if he would like to buy some oats, and showed him a sample. The manager wrote to say that he would take the whole quantity. The plaintiff delivered a portion of them. The defendant complained that the oats were new oats, whereas he thought he was buying old oats, new oats being useless to him. The plaintiff, who knew that the oats were new, refused to take them back and sued for the price Smith v Hughes (1871) LR 6 QB 597

6. During the course of negotiations for the sale of a medical practice, the vendor made representations to the purchaser that it was worth 2000 a year. By the time when the contract was signed, they were untrue. The value of the practice had declined in the meantime (to 250) because of the vendor's inability to attend to it through illness.

With v O'Flanagan [1936] Ch 575 3. Hint - ON DISCHARGE OF CONTRACT- PERFORMANCE

Re Moore and Landauer [1921] 2 KB 519 7. There was an agreement for the sale of 3,000 tins of canned fruit packed in cases of 30 tins. When delivered it was discovered that half the cases contained only 24 tins although the total number of tins was still 3,000. The market value was not affected. --notwithstanding that there was no loss to the buyer, can he reject the whole consignment because of the breach of contract?

Hint - goods must correspond with the description 4. EXCLUSION CLAUSES- INCORPORATION 8 The plaintiff bought a cigarette machine for her cafe from the defendant and signed a sales agreement, in very small print, without reading it. The agreement provided that "any express or implied condition, statement or warranty is hereby excluded". The machine failed to work properly. an action for breach of warranty was brought by the defendants. Hint - When a document containing contractual terms is signed, then, in the absence of fraud, or, misrepresentation, the party signing it is bound, and it is wholly immaterial whether he has read the document or not. Hint - . L'Estrange v Graucob [1934] 2 KB 394 9. The plaintiff took a wedding dress to be cleaned by the defendants. She signed a piece of paper headed 'Receipt' after being told by the assistant that it exempted the cleaners from liability for damage to beads and sequins. The receipt in fact contained a clause excluding liability "for any damage howsoever arising". When the dress was returned it was badly stained.

The plaintiff brought an action against the cleaners for damage to the material of the dress. Curtis v Chemical Cleaning Co [1951] 1 KB 805

10. The plaintiff deposited a bag in a cloak-room at the defendants' railway station. He received a paper ticket which read 'See back'. On the other side were printed several clauses including "The company will not be responsible for any package exceeding the value of 10." The plaintiff presented his ticket on the same day, but his bag could not be found. He claimed 24 10s. as the value of his bag, and the company pleaded the limitation clause in defence. Decide .

Parker v South Eastern Railway (1877) 2 CPD 416

5. FORMATION OF A CONTRACT 11. The defendant made the highest bid for the plaintiff's goods at an auction sale, but he withdrew his bid before the fall of the auctioneer's hammer. It was held that the defendant was not bound to purchase the goods.

Hint - His bid amounted to an offer which he was entitled to withdraw at any time before the auctioneer signified acceptance by knocking down the hammer.

Payne v Cave (1789)

12. A shopkeeper displayed a flick knife with a price tag in the window. The Restriction of Offensive Weapons Act 1959 made it an offence to 'offer for sale' a 'flick knife'. The shopkeeper was prosecuted in the magistrates' court but the Justices declined to convict on the basis that the knife had not, in law, been 'offered for sale'. This decision was challenged in the Queen's Bench Divisional Court.

Hint - It is perfectly clear that according to the ordinary law of contract the display of an article with a price on it in a shop window is merely an invitation to treat. It is in no sense an offer for sale the acceptance of which constitutes a contract.

Fisher v Bell (1960)

13 The plaintiffs sent a telegram to the defendant, "Will you sell Bumper Hall Pen? Telegraph lowest cash price". The defendants reply was "Lowest price 900". The plaintiffs telegraphed "We agree to buy for 900 asked by you". Whether there is a contract?

Hint - defendants telegram was not an offer but simply an indication of the minimum price the defendants would want, if they decided to sell.

14. 6 June W offered to sell his estate to H for 1000; H offered 950 27 June W rejected H's offer 29 June H offered 1000. W refused to sell and H sued for breach of contract. Hyde v Wrench (1840)

15. If a man shouts an offer to a man across a river but the reply is not heard because of a plane flying overhead. Whether there is a contract.? Lord Denning in Entores v Miles Far East Corp (1955)