INTRODUCTION

When the word “contract” is mentioned, there is a tendency for many people to see

this as some form of formal written document. When asked how often they

enter into a contract, many would say only occasionally, as when they purchase a car, a house or enter into a loan agreement with

the bank. In other words, ‘contract’ is associated with a narrow range of activity

involving lawyers, documents and agreements concerning things of substantial

value.

An agreement made between two or more person whereby the parties to the agreement

are bound by a LEGAL RELATIONSHIP.

ALL CONTRACTS

ARE AGREEMENT

BUT

NOT ALL

AGREEMENTS

ARE

CONTRACT!

The Latin phrase consensus ad idem (consensus as to the same thing) describes this concept of agreement. The essence of the

phrase is that the parties to contract must have “meeting of minds”

TYPES OF CONTRACT

SIMPLECONTRACTS

SPECIALTYCONTRACTS

ORAL WRITTENWRITTEN

(DEED)

Contract forSales of Goods

Contract forSupply of

Goods

Contract of Service

Contract forServices

½ Oral & ½ Written

There is no necessity for a contract to be in writing. A

contract can be made orally, in writing or it could be a

combination of both oral and written. Only contract involving the sales and

transfer of land needs to be in written form.

Understanding Contract

What is the What is the Agreement?Agreement?

What is withinWhat is withinThe The

Agreement?Agreement?‘‘Terms’Terms’

What defects What defects In the In the

Agreement?Agreement?‘‘Vitiating factors’Vitiating factors’

How the contractHow the contractIs Is

Discharged?Discharged?

Remedies Remedies Available!Available!

What is the agreement?• Offer

– Unilateral offer– Bilateral offer– Invitation to treat

• Acceptance– General rule – Postal rule

• Intention to create Legal Relations– Social and domestic agreement– Commercial agreement

• Consideration– Executed – Executory– Past

• Capacity to Contract

What is within the agreement?TERMS

•EXPRESS TERMS•IMPLIED TERMS•INNOMINATE TERMS•EXEMPTION CLAUSES/EXCLUSION CLAUSES

•CONDITIONS•WARRANTIES

What Defects in the Agreement?• Misrepresentation

– Fraudulent– Innocent– Negligent

• Mistake– Common mistake– Mutual mistake– Unilateral mistake– Non est factum

• Duress • Undue Influence• Illegality• Contract in Restraint of Trade

VITIATING FACTOR

Discharge of Contract

•Performance.•Agreement.•Breach (aka:

repudiation)•Frustration.

VOID

VOIDABLE

SPECIFICPERFORMANCE

INJUNCTION

QUANTUMMERUIT

REMEDIES