Summary Exam Notes for Contract Law B

Contract Law B Exam Notes:
Idenfying Express Terms………………………………………………..
Construing Express Terms………………………………………………..
Implying Terms………………………………………………………………..
Doctrine of Frustraon…………………………………………………….
Terminaon……………………………………………………………………..
Performance…………………………………………………………………….
Breach………………………………………………………………………………
Remedies for Breach………………………………………………………..
Mistake…………………………………………………………………………….
Misrepresentaon…………………………………………………………….
Misleading and Decepve Conduct…………………………………..
Duress………………………………………………………………………………
Undue In)uence……………………………………………………………….
Unconscionable Conduct…………………………………………………..
Remedies…………………………………………………………………………..




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, How to approach a problem queson:
1. Read the ques on
2. Read the facts and underline the relevant ones
3. Consider what the ques on is asking for: for all relief or only a speci
c type?
4. Always begin with the simplest op on (e.g. was it a term?) before moving onto the
more complex op ons (e.g. can it be implied and was there a breach?). Finally move
into vi a ng factors (e.g. mistake)
5. Look from BOTH PARTIES – e.g. what would P and D raise.
6. DO NOT FORGET statutory stu3!
7. Examine as many remedies as you can and conclude which would be the best for the
client – e.g. damages v rescission, contract v tort, common law v statute.



RIGHT TO REMEDY/RIGHT VITIATING FACTOR REMEDY/RIGHT
TERMINATE
Breach Damages – as if the Mistake Elec on – rescission
contract had been or a:rma on
ful
lled
Repudia on Damages Misrepresenta on Rescission
Termina on by Elec on – terminate Misleading/decep v Injunc ons: s232
agreement or a:rm e conduct (breach of ACL
s18 ACL) Damages: s236 ACL
Non-ful
lment of Elec on – terminate Duress Elec on: rescission
a con ngent or a:rm or a:rma on
condi on
Undue inBuence Elec on: rescission
or a:rma on
Unconscionable Elec on: rescission
conduct (CL) or a:rma on
Unconscionable Injunc ons: s232
conduct (ACL) ACL
Damages: s236 ACL
Unfair contracts Injunc ons: s232
ACL
Damages: s236 ACL
Unjust contracts Sec on 7 Contracts
Review Act




Idenfying the Express Terms:
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,Express terms may be:

1. Incorporated into the par es’ contract:
a. By signature – signing a wriEen document
b. By no ce – one party displaying or delivering a wriEen document to the other
c. By a course of dealing between the par es
2. Found in statements made during pre-contractual nego a ons
3. A combina on of 1 & 2.

Incorporated by SIGNATURE:
 A party will be bound by all statements in a contract if the party has signed the
document, regardless of whether or not the party has read the contract (L’Estrange v
Graucob) or the terms are unusual or onerous (Toll v Alphapharm).
 This rule will NOT APPLY if there is:
 Fraud or misrepresenta on (Cur
s v Chemical Cleaning)
 Duress, mistake (e.g. non est factum) or other vi a ng circumstance or claim for
statutory relief (L’Estrange; Toll)
 Documents signed would not reasonably be understood to be a contract (Toll;
Cur
s Chemical Cleaning)

Non est factum: this doctrine allows a signing party to escape performance of the
agreement, where the signature on the contract was signed by fraud, misrepresenta on or
mistake. It makes it void ab ini o. However is hard to claim as it does not allow for
negligence on the part of the signatory.

Incorporated by NOTICE:
 Only terms that have been made available to a party before a contract is made can
be incorporated into the contract so as to be binding on that party (Oceanic Sun
Line) (always establish when acceptance occurred and when contract formed)
 There is acceptance if the party knew of terms/was aware of the them at the me
contract was formed (Thornton v Shoe Lane Parking)
 Has D done what was reasonable in the circumstances to give P noce of the term?
 Timing: no ce must be given before the contract is formed (Olley v Marlborough
Court; Thornton; Oceanic Sun Line; Bal
c Shipping v Dillon)
 Reasonable no ce: no ce must be reasonable having regard to type of contract
and nature of term (Thornton; Oceanic Sun Line; Bal
c Shipping)




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, Incorporated by COURSE OF DEALINGS:
 Although no ce of a term may come too late to be incorporated on the
rst
occasion, it may be incorporated if a party does repeat dealings with another and:
 The party knew/reasonably should have known that the other party contracted
on that term (Henry Kendall; Balmain New Ferry v Robertson)
 Dealings must be uniform (McCutcheon v MacBrayne) and regular (Henry
Kendall)
 Document containing the term must have been reasonably considered or treated
by the par es as a contractual document and not as a mere receipt (Hill v
Wright; Rinaldi)

Statements made in PRE-CONNTRACTUAL NEGOTIATIONS:
Relief depends on whether the statement was a term of the contract, a representaon
inducing the party to enter the contract, or a mere puf.

Is the statement a term?

1. Is evidence of pre-contractual statements admissible?
 YES: if contract is part oral/part wriEen
 NO: if contract is wholly in wri ng (parol evidence rule)
2. Is the pre-contractual statement promissory?
 To amount to a term, statement must be promissory. Otherwise may be a mere
pu3 or a mere representa on – assess objec vely (JJ Savage)

STEP 1: is statement a term?
 Parol evidence rule (PER) acts to prevent extrinsic evidence being used to:
 Subtract from, add to, vary or contradict the terms as they appear in the doc.
 Explain meaning of the terms as they appear in the document…

…where the contract is recorded wholly in wri ng. Courts assume all terms will be
included in wri ng and will be known to both par es (Codelfa; Hoyts v Spencer)

 Parol evidence rule excludes:
 Extrinsic evidence of prior nego a ons (including verbal or wriEen exchanges
between the par es during nego a ons)
 Extrinsic evidence of the par es actual subjec ve inten ons
 Extrinsic evidence of subsequent conduct of par es
 Where the document appears on its face to be a complete record it will be taken to
be a contract in wri ng (Thorne v Borthwick) – strict approach




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