Contract Law 1 Lecture 3 (The University of Papua New Guinea, 2024) PDF

THE UNIVERSITY OF PAPUA NEW GUINEA SCHOOL OF LAW Semester 1, 2024 Contracts Law 1 ( 5.10704 ) Lecture 3 Elements of contract 1. Offer and Acceptance 2. Intention to create legal relations 3. Capacity to contract 4. Consideration 5. Legality of the objects of contract 6. Formalities 1. Offer and Acce...

THE UNIVERSITY OF PAPUA NEW GUINEA SCHOOL OF LAW Semester 1, 2024 Contracts Law 1 ( 5.10704 ) Lecture 3 Elements of contract 1. Offer and Acceptance 2. Intention to create legal relations 3. Capacity to contract 4. Consideration 5. Legality of the objects of contract 6. Formalities 1. Offer and Acceptance Offer A ------------------offer----------------------------> B < ---------------- acceptance--------------------- A – Offeror B - Offeree Offer A proposition by the offeror to the offeree coupled with an intimation by the offeror that he/she is willing to enter into a contract should the offeree accept the terms of the offer R v Clark ( 1927 ) CLR 227 Leana v PNG Power Ltd ( 2005 ) N3085 A. To whom? i) A particular person. identifiable person  Perform  Subject matter. Egs: Coffee Buai Car Aircraft,etc ii) A group of persons Egs: Accountants  Specialist skills Egs: Company auditors Doctors  Specialist skills Egs: Surgeons Lawyers  Specialist skills Eg: Contract law lawyers iii) World at large Carlill v Carbolic Smoke Ball Co ( 1892) 2 QB 484 CSBC-----Advertisement Medicinal drug –influenza Take as prescribed Still contract influenza  500 pounds Mrs C---took -influenza Claimed 500--refused CSBC---Defence:  No offer to Mrs C  No acceptance  No communication Court:  World at large  Mrs C accepted by purchase  No requirement to communicate acceptance  CSBC waived that requirement Not an offer: a) Invitations to treat. Supermarket  Shopper offers to buy  Store owner accepts Payne v Cave ( 1789 ) 3 Term Rep 148 Pharmaceutical Society of GB v Boots ( 1953 ) 1 QB 256 Fisher v Bell ( 1961 ) 1 QB 304 b) Auctions i) Property owner ii) Auctioneer. agent of owner. duty – highest bid iii) Bidder – makes offer Payne v Cave ( 1789 ) 3 Term Rep 148 Harris v Nickerson ( 1873 ) LR 8 c) Advertisements i) Property owner or agent ii) Employer or agent iii) Newspaper/radio iv) Owner of building v) Owner of notice board vi) Interested buyer/seller/emplo yee Carlill v Harding ( 1870 ) LR 5 Cp 561 Patridge v Crittenden ( 1968 ) 2 ALL ER 421 d) Statements of price i) ii) Property owner or agent  Eg: Selling - K20,000.00 ono Buying - K20,000.00 per metric ton Interested buyer/seller Harvey & Ano v Facey & Ors ( 1893 ) UKPC 1 Gibson( AP) v The Council of the City of Manchester ( 1979 ) 1 All ER 972 e) Tenders i) Property owner  Sell property  No price  Reserve price ii) Interested buyer  Nominates price Harvela Investments v Royal Trust Co of Canada ( 1985 ) 2 All ER 966 Blackpool Aero Club v Blackpool Borough Council ( 1990 ) 3 ALL ER 25 f) Memorandum seeking attention of interested buyers Mcdonald and McDonald v Papuan Constructions Ltd ( 1964 ) PNGLR 22 Maip Pty Ltd v Ambra Coffee Estate ( 1995 ) N1368 Hohore Suve v Bromley & The Rural Development Bank of PNG ( 1997 ) PGNC 68 g) Draft Agreements  Records future intention of parties  Non-binding  MOUs  MOAs Seafreights Pty Ltd v Bishop Shipping Services Pty Ltd ( 1996 ) PNGLR 22