Contract Law: Modification of Contracts

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Questions and Answers

What is the first step in producing a good answer in a contractual modification scenario?

Creating a clear structure for the answer

Determining the practical benefit of the modification

Explaining the doctrine of promissory estoppel

Identifying the correct area of law to discuss (correct)

Which of the following doctrines is relevant in a contractual modification scenario?

Economic duress

Promissory estoppel

Doctrine of consideration

All of the above (correct)

What is the importance of clear expression in a contractual modification answer?

To demonstrate a deep knowledge of legal principles

To ensure the examiner rewards the answer (correct)

To show the steps taken to solve the problem

To confuse the examiner

What is the best approach to answering a contractual modification problem involving multiple contracts?

Dealing with each contract separately Signup and view all the answers

What is required to have a good knowledge of the doctrines of consideration in contractual modifications?

Understanding the legal principles alongside the cases that illustrate their application Signup and view all the answers

What is the primary concern of the courts in the doctrine of promissory estoppel?

To protect the reasonable reliance of the party who relied upon the promise Signup and view all the answers

What is the main distinction between present and past consideration?

Past consideration is not sufficient to form a contract Signup and view all the answers

What are the three basic requirements for a contract?

Agreement, consideration, and intention to create legal relations Signup and view all the answers

What is the definition of consideration in the context of contract law?

A benefit to one party or a detriment to the other Signup and view all the answers

What is the purpose of the doctrine of promissory estoppel in contract law?

To protect the party that relied on the promise from detriment Signup and view all the answers

What was a common issue with many answers related to contract modification?

They were too short and did not use up the word allowance. Signup and view all the answers

What did stronger answers identify at the initial point?

The legal doctrines that must be considered. Signup and view all the answers

What is a key aspect of promissory estoppel in the context of contractual modifications?

It limits the enforcement of the modifying promise. Signup and view all the answers

What is a consequence of establishing economic duress in a contractual modification?

The contract is liable to be set aside. Signup and view all the answers

What did particularly good answers feature in the context of promissory estoppel?

The requirement of reliance described by reference to Lord Goff's judgment. Signup and view all the answers

What is a common mistake made by students when discussing promissory estoppel?

Making an over-general account of legal principles Signup and view all the answers

What is the significance of the Postchaser case in relation to promissory estoppel?

It described the type of reliance required for promissory estoppel Signup and view all the answers

Why is it important to reference decided cases when discussing promissory estoppel?

To support arguments with legal authority Signup and view all the answers

What is the challenge involved in problem-type questions on promissory estoppel?

Applying law to fact Signup and view all the answers

What is the consequence of not correctly identifying the area of law in a problem-type question?

Losing credit for the answer Signup and view all the answers

What can be inferred about the element of consideration in the definition of consideration?

It has less importance than is sometimes alleged Signup and view all the answers

Why might the pupil in the scenario have argued that she was providing consideration?

Because she was suffering a short-term economic detriment Signup and view all the answers

What is the main issue in the third situation of existing obligations as good consideration?

The variation of existing contractual obligations as between the parties Signup and view all the answers

In what situation would a promise of payment not generally be enforceable?

When a public official agrees to perform a duty in return for a promise of payment Signup and view all the answers

What is the primary concern in the context of existing obligations as good consideration?

Determining whether the variation of existing contractual obligations can become binding Signup and view all the answers

What was the reason the Supreme Court did not review the changes to the doctrine of consideration in Williams v Roffey?

The contract contained a no oral modification clause. Signup and view all the answers

Why did Lord Sumption consider the consideration issue to be 'difficult' and important?

Because it should be reserved for an enlarged panel of Justices. Signup and view all the answers

What is the significance of the use of an enlarged bench in certain cases?

To provide a definitive ruling on a key area of law. Signup and view all the answers

What principle was accepted by the Supreme Court in the MWB case?

That courts should enforce contract terms intended to regulate amendments. Signup and view all the answers

What was the consequence of the Court of Appeal's decision in NHS Commissioning Board v Vasant EWCA Civ 1245?

The principle of enforcing contract terms regulating amendments was followed. Signup and view all the answers

Why do the courts refuse to interfere in cases of allegedly bad bargains?

To uphold the principle of freedom of contract Signup and view all the answers

What is the reasoning behind the decision in Chappell v Nestlé?

The requirement encouraged people to buy the company's chocolate Signup and view all the answers

What is the problem with the consideration in White v Bluett (1853)?

It was deemed incapable of being consideration Signup and view all the answers

What does Denning LJ find as consideration in Ward v Byham (1956)?

The mother's promise to provide for the child's upbringing Signup and view all the answers

What concern arises when considering the mother's promise in Ward v Byham (1956)?

Whether doing something the law already obliges you to do can be good consideration Signup and view all the answers

Why does the court not interfere in cases of allegedly bad bargains?

To uphold the principle of freedom of contract Signup and view all the answers

What is the potential problem with the consideration in Chappell v Nestlé?

It has no economic value Signup and view all the answers

What is the implication of the decision in Chappell v Nestlé?

Consideration need not have economic value Signup and view all the answers

What is the significance of the mother's promise in Ward v Byham (1956)?

It is good consideration with economic value Signup and view all the answers

What is the key issue in determining the adequacy of consideration?

Whether the consideration has economic value Signup and view all the answers

Study Notes

Common Errors in Contract Modification

Failing to identify the correct area of law to discuss (contract modification)
Not correctly applying the legal principles to the facts of the scenario
Providing an over-general account of the relevant legal principles without elaborating or referencing decided cases
Not demonstrating a clear structure for the answer

Key Factors for a Good Answer

Identifying the correct area of law to discuss (contract modification)
Clear expression of difficult concepts (e.g. practical benefit)
Creating a clear structure for the answer
Demonstrating a deep knowledge of the relevant legal principles (consideration, promissory estoppel, economic duress)
Ability to apply legal knowledge to the facts of the scenario

Consideration in Contract Modification

Definition: A valuable consideration in the sense of the law may consist of either a benefit to one party or a detriment to the other
Requirements: Agreement, consideration, and intention to create legal relations
Types of consideration: Present and past consideration
Importance of consideration in contract modification: Williams v Roffey, MWB v Rock, Pakistan Airlines

Promissory Estoppel

Definition: A doctrine that makes a promise legally binding without consideration
Requirements: Reliance, consideration, and intention to create legal relations
Cases: Postchaser, Ward v Byham
Importance of promissory estoppel in contract modification: Protecting the reasonable reliance of the party who has relied upon the promise

Economic Duress

Definition: A doctrine that makes a contract voidable if one party is forced to enter into it due to economic pressure
Requirements: Economic pressure, lack of free will, and intention to create legal relations
Cases: MWB v Rock, Pakistan Airlines
Importance of economic duress in contract modification: Rendering the contract voidable

Existing Obligations as Good Consideration

Three types of existing obligations:
- Obligations that arise under the law, independently of any contract
- Obligations that are owed under a contract with a third party
- Obligations to perform an existing obligation under a contract to the same contracting party
Examples: Public official agreeing to carry out duties in return for a promise of payment, variation of existing contractual obligations

Case Law

Williams v Roffey: Consideration and practical benefit
MWB v Rock: Consideration and economic duress
Pakistan Airlines: Economic duress
Postchaser: Promissory estoppel and reliance
Ward v Byham: Consideration and economic value
Chappell v Nestlé: Consideration and economic value
NHS Commissioning Board v Vasant: Enforcing contract terms intended to regulate how the contract can be amended

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Description

Test your knowledge of contract law, specifically the modification of contractual relations. Identify the correct area of law and apply the doctrine of consideration to the given scenario.