Lecture 1: What is a contract? - A voluntary agreement that is legally binding (and legally enforceable) Types of contracts: - Agreements: Sales of goods , e.g. a car Supply of services , e.g. a courier Hire of goods , e.g. a van Credit agreements , e.g. a bank loan Employment , e.g. a part time job Contract Law establishes the rules and principles regarding: - Formation Elements that need to be present for the law to consider that the contract has been a legally formed and enforceable contract (meeting certain requirements) - Enforceability If a proper contract has been formed, then the law can back the individual if the other party was to pull out - Content What needs to be included and what is not legal to include (the terms and conditions) The law can imply terms into the contract - Setting aside When a contract needs to be discharged and ended - Frustration Events happen that result in the performance of obligations are radically different to those which were intended - Performance Parameters that are in place to ensure a satisfactory performance of contract rules - Breach One of the parties' behaviours is not in line with the requirements that were outlined at the beginning of the contract - Remedies Solving the issues that arise within a contract if one of the parties was to not comply with the rules set (in case of a breach) Allows for the victim of the breach to be restored to a state which they would find themselves in if the contract was to go through as normal The role of contract law: - Enforcing promises - Regulating the market - Facilitating exchanges - Informs parties what they are expected to do - Specifies the interpretations of the contents - Clarifies what would happen if the contract is not performed - Encourages performance by establishing remedies in cases of a breach The development of contract law: - General principles were developed primarily through the common law, derived from the previous versions of that law (through the generations) - There have been interventions at different stages - There are laws that cover certain contracts e.g. employment contracts Mainly for the protection of rights
Freedom of Contract Ideology , also known as the Classical Theory: - A liberal approach suggesting that parties are free to enter a contract and determine the terms - Based on an exchange of promises - Each transaction is viewed as 'discreet' Each agreement is treated as it's own activity (not as a chain) - The role of the court = 'umpire' or 'arbiter' (those who settle an agreement) - Contractual obligations are based on what the parties agreed on at the time of contract - The 'will theory' is linked to the freedom of contract theory - The will theory: Parties to a contract have a great level of freedom Each parties can decide to whatever they want and the law should back this Freedom of contract: -