CLUSTER 2: PRIVATE LAW - Contract law 1: formation

15 important questions on CLUSTER 2: PRIVATE LAW - Contract law 1: formation

What is a legal contract?

A mutual agreement that bind parties to obligations they have voluntarily accepted.

What are the 3 phases of a contract that should be regulated?

1. Formation
2. ConsequencesL
- content of contract (obligation, interpretation of contract, good faith(
- remedies in case of non-performance
3. Termination (can also be a remedy)

Upon what conditions is a contract concluded?

Intention (free will), agreement (offer and acceptance) about obligations and in common law requirement of consideration (mutual promise)
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When is there an intention to be bound?

The parties intend to be legally bound to bring about a legal effect without being mininformed, misrepresented or forces into the contract.

When is there an agreement between parties?

Agreements can be formed in many ways. When the offer has reached the other party and the other party explicitly accepts the agreement is formed.

When is the requirement of consideration met?

There is a bargain required in turn for the promise to assume obligations. The promise has to be mutual. In common law a contract should be obligated for both parties in order to be a legal contract.

On what can a consideration be based?

Money, promises or forbearances.

What 4 issues can arise within formation of a contract?

1. No formalities (agreement)
2. Defect of willl (intention)
3. No reqruiement of consideration.

What is hard about determining if the condition of intention is met?

It is not clear when there is an intention to be bound (subjective) and what the content of quality of that intention is.

When will an issue of defect of will arise? (name 2)

Defective intention: the intention was not based on a free will.
defective will to be bound: intention of a party has not been arisen in a proper manner.

When will a contract be declared invalid or void?

Wen there is defect of will (the intention of a party has not been arisen in a proper manner)

What are the conditions under which a contract will be invalidated by court based on defect of will under the civil law system?

1. Mistake: the contracting party was msitaken or misinformed about the contract. There was breach of duty to disclose relevant information.
2 Fraud: a party by devious means caused the other party to agree to the contract
3. Threat: one party threatened the other party into agreeing
4. Undue influence: abusing one parties vulnerable position into favourable contractual conditins.

What are the conditions under which a contract can be invalidated by court based on defect of will under the common law system?

misrepresentation: there should be explicit representation between buyer and seller. Common law does not recognize fraud, threat and undue influence.

What does ceveat emptor mean?

There is no duty to dec;are and the buyer should look after their own interests.

What is the essential difference between misinterpretation and mistake?

A msitake can occur without explicit representation.

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