PGDL CONTRACT LAW QUESTIONS & ANSWERS
State the three elements required to form a legally binding contract - Answer -1.
Consideration
2. Intention to Create Legal Relations
3. Agreement (O+A)
What must an offer be? - Answer -1. Valid (Clear, Certain, and Addressed to the
Offeree)
2. Communicated to offeree
3. Not rejected, revoked or lapsed
4. Made with intention to treat
What must acceptance be? - Answer -1. A mirror image of the offer
2. Made by the offeree in response to the offer
3. Communicated to the offeror
Offeror - Answer -Person making the offer
Offeree - Answer -Person to whom the offer is made
When is there a valid offer? - Answer -Treitel: An expression of willingness to contract
on specified terms made with the intention that it is to become legally binding as soon
as it is accepted by the person to whom it is addressed
Invitation to treat - Answer -Preliminary stage of negotiations, not an offer
Adverts - Answer -The general rule is that an advert is an ITT, not an offer
Invitation to tender - Answer -The general rule is that an invitation to tender is an ITT,
not an offer
How can an offer be communicated? - Answer -1. Orally
2. In Writing
3. By Conduct
How can an offer be terminated? - Answer -1. Rejection
2. Revocation
3. Lapse
Counter-Offer - Answer -Rejection of the first offer
Request for further information - Answer -Original offer remains open
, Revocation - Answer -Can occur any time before acceptance
Revocation of a unilateral offer - Answer -Can be revoked any time before complete
performance
Lapse - Answer -1. Passage of time-after a reasonable period
2. fulfilment of a condition
3. Death
Requirements for acceptance - Answer -1. Must be mirror image of the offer
2. Must be made by an offeree
3. In response to the offer/ being aware of the offer
4. Motive for acceptance is irrelevant
5. An acceptance must be communicated
Exceptions to the above requirement for communication of acceptance - Answer -1. For
unilateral offers, only performance of the act is necessary
2. Where the failure to communicate acceptance is the offeror's fault
3. The Postal Rule
The Postal Rule - Answer -- For acceptance sent in the post, acceptance occurs at the
moment of posting
- Offeror cannot revoke their offer after acceptance is posted, even if they are unaware
of its posting
- Must be properly posted
- The acceptance is still valid even if the letter is lost or destroyed
Exceptions to the Postal Rule - Answer -- If it is addressed incorrectly by the offeree
then it is only valid from the moment that it arrives
- It is not reasonable to use the post or there is an implied condition or actual condition
that prompt acceptance is required
- If the application of the postal rule would cause manifest inconvenience and absurdity
- If the postal rule is ousted by the offeree
Instantaneous Communications - Answer -Acceptance occurs when the
communications is received
Unilateral Offer - Answer -A legal contract in which one individual, the buyer, pays for a
specific action from another party. One-Sided agreement
Bilateral offer - Answer -Between two parties who agree to perform certain services to
provide certain products for a specific price
Intention to Create Legal Relations - Answer -In order for an agreement to be legally
enforceable, at the time of contracting the parties must have had the intention to enter
into a legally binding arrangement
State the three elements required to form a legally binding contract - Answer -1.
Consideration
2. Intention to Create Legal Relations
3. Agreement (O+A)
What must an offer be? - Answer -1. Valid (Clear, Certain, and Addressed to the
Offeree)
2. Communicated to offeree
3. Not rejected, revoked or lapsed
4. Made with intention to treat
What must acceptance be? - Answer -1. A mirror image of the offer
2. Made by the offeree in response to the offer
3. Communicated to the offeror
Offeror - Answer -Person making the offer
Offeree - Answer -Person to whom the offer is made
When is there a valid offer? - Answer -Treitel: An expression of willingness to contract
on specified terms made with the intention that it is to become legally binding as soon
as it is accepted by the person to whom it is addressed
Invitation to treat - Answer -Preliminary stage of negotiations, not an offer
Adverts - Answer -The general rule is that an advert is an ITT, not an offer
Invitation to tender - Answer -The general rule is that an invitation to tender is an ITT,
not an offer
How can an offer be communicated? - Answer -1. Orally
2. In Writing
3. By Conduct
How can an offer be terminated? - Answer -1. Rejection
2. Revocation
3. Lapse
Counter-Offer - Answer -Rejection of the first offer
Request for further information - Answer -Original offer remains open
, Revocation - Answer -Can occur any time before acceptance
Revocation of a unilateral offer - Answer -Can be revoked any time before complete
performance
Lapse - Answer -1. Passage of time-after a reasonable period
2. fulfilment of a condition
3. Death
Requirements for acceptance - Answer -1. Must be mirror image of the offer
2. Must be made by an offeree
3. In response to the offer/ being aware of the offer
4. Motive for acceptance is irrelevant
5. An acceptance must be communicated
Exceptions to the above requirement for communication of acceptance - Answer -1. For
unilateral offers, only performance of the act is necessary
2. Where the failure to communicate acceptance is the offeror's fault
3. The Postal Rule
The Postal Rule - Answer -- For acceptance sent in the post, acceptance occurs at the
moment of posting
- Offeror cannot revoke their offer after acceptance is posted, even if they are unaware
of its posting
- Must be properly posted
- The acceptance is still valid even if the letter is lost or destroyed
Exceptions to the Postal Rule - Answer -- If it is addressed incorrectly by the offeree
then it is only valid from the moment that it arrives
- It is not reasonable to use the post or there is an implied condition or actual condition
that prompt acceptance is required
- If the application of the postal rule would cause manifest inconvenience and absurdity
- If the postal rule is ousted by the offeree
Instantaneous Communications - Answer -Acceptance occurs when the
communications is received
Unilateral Offer - Answer -A legal contract in which one individual, the buyer, pays for a
specific action from another party. One-Sided agreement
Bilateral offer - Answer -Between two parties who agree to perform certain services to
provide certain products for a specific price
Intention to Create Legal Relations - Answer -In order for an agreement to be legally
enforceable, at the time of contracting the parties must have had the intention to enter
into a legally binding arrangement
