Download Contracts Subject Guide - The University of Sydney

LAW EXTENSION COMMITTEE
UNIVERSITY OF SYDNEY
02 CONTRACTS SUBJECT GUIDE
SUMMER SESSION 2007-08
Course Description and Objectives
Teacher
Assessment
March 2008 Examination
Texts and Materials
Lecture Program
LEC Orientation
Legal Institutions and Contracts Introductory Weekend School
Weekend Schools 1 and 2
Tutors and Legal Skills Workshops
Assignments
Assignment Questions
Prescribed Topics and Course Outline
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1
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2
2
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5
5
6
7
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9
1
LAW EXTENSION COMMITTEE
SUMMER 2007-08
02 CONTRACTS
COURSE DESCRIPTION AND OBJECTIVES
The law relating to contracts is one of the pillars of the common law system. An understanding of the
basic elements of contract law is thus a critical pre-requisite for the study of a number of later subjects,
including Conveyancing, Commercial Transactions and Industrial Law.
The course aims to provide students with an understanding of the basic principles of contract law
which apply to nearly all contracts. In fulfilling this aim, the course focuses primarily on a study of
relevant case law and statute law. The course covers the elements of formation of contracts, terms of
a contract, matters affecting consent to a contract, discharge of contracts, illegality, remedies, and
third party rights.
Special principles that apply to specific types of contracts are dealt with in later courses.
The objectives of the course are:
(a)
to provide students with an understanding of basic principles of contract law; and
(b)
to develop in students an ability to analyse fact situations and correctly identify the relevant
principles of contract law that are applicable to the resolution of problems raised by particular
factual situations.
TEACHER
Dr Peter Radan, BA, LLB, PhD (Syd), Dip Ed (SCAE)
Dr Radan is an Associate Professor of Law at Macquarie University. He holds the degrees of Bachelor
of Arts, Bachelor of Laws and Doctor of Philosophy from the University of Sydney, as well as a
Diploma in Education from Sydney College of Advanced Education. Dr Radan has been a Teacher
with the Law Extension Committee since 1984. His most recent published books include (with A
Pavkovic) Creating New States: Theory and Practice of Secession (Ashgate, UK, 2007); (with C
Stewart & A Lynch) Equity & Trusts – Butterworths Tutorial Series (2nd Ed, LexisNexis Butterworths,
Sydney, 2005), (co-edited with D Meyerson & R Croucher) Law & Religion, God, the State and the
Common Law (Routledge, London, 2005) and The Break-up of Yugoslavia and International Law
(Routledge, London, 2002).
ASSESSMENT
To be eligible to sit for the Board’s examinations, all students must complete the LEC teaching and
learning program, the first step of which is to ensure that you have registered online with the LEC in
each subject for which you have enrolled with the Board. This gives you access to the full range of
learning resources offered by the LEC.
Then, students must achieve a satisfactory result (at least 50%) in each subject where a compulsory
component is prescribed. In Contracts there is a compulsory requirement of satisfactorily completing
two assignments (see page 7).
To register with the LEC, go to www.usyd.edu.au/lec and click on the WEBCAMPUS link and follow
the instructions. Detailed guides to the Webcampus are contained in the material distributed by the
LEC, in the Course Information Handbook, and on the Webcampus.
2
MARCH 2008 EXAMINATION
Candidates will be expected to have a detailed knowledge of the prescribed topics: formation of
contracts, terms of a contract, matters affecting consent to a contract, discharge of contracts, illegality,
remedies, and third party rights. A more detailed outline of the prescribed topics is set out below (p. 9
and following) under the heading ‘Prescribed Topics and Course Outline’.
Candidates will be expected to have made a study of the prescribed materials in relation to those
topics, and to have analysed the cases and statutory provisions referred to in the Law Extension
Committee's course outline.
The examination will consist of six questions. Students will have to complete five of the six questions.
There may be internal choice within some of the questions. All questions will be of equal value.
At least five of the questions will be problem-type questions.
The examination will be an open book examination, although students will not be permitted to take into
the examination room electronic sources of material nor library books borrowed from any University of
Sydney library.
Please note: All questions in relation to the examination should be directed to the Legal
Profession Admission Board, not the Law Extension Committee.
TEXT AND MATERIALS
Course Materials

Guide to Presentation and Submission of Assignments (available on the LEC Webcampus)
Prescribed Materials


Gooley & Radan, Principles of Australian Contract Law, LexisNexis Butterworths, 2006
Gooley, Radan & Vickovich, Principles of Australian Contract Law, Cases and Materials,
LexisNexis Butterworths, 2007
Reference Materials








Carter, Carter’s Guide to Australian Contract Law, LexisNexis Butterworths, 2006 (a useful
introductory contracts textbook)
Carter, Peden & Tolhurst, Contract Law in Australia, 5th ed. LexisNexis Butterworths, 2007
Heffey, Paterson & Robertson, Principles of Contract Law, 2nd ed, Thomson Lawbook, 2005
Heffey, Paterson & Robertson, Contract: Commentary and Materials, 10th ed. Thomson Lawbook,
2004
Willmott, Christensen & Butler, Contract Law, 2nd ed, Oxford University Press, 2005
Starke, Seddon and Ellinghaus, Cheshire and Fifoot's Law of Contract, 8th Australian ed.
LexisNexis Butterworths, 2002 (9th edition due on Nov 1st , 2007)
Journal of Contract Law
CCH, Australian Contract Law Reporter
The guide lists the cases that should be read as a minimum for students to gain a grounding in the
basic principles of contract law. The guide also lists relevant statutory provisions that need to be
studied and understood.
Students are encouraged to read beyond these cases, and in this respect the other cases mentioned
in the textbook and casebook serve as a starting point.
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LEC Webcampus
Once you have registered online with the LEC, you will have access to all the facilities on the LEC
Webcampus including the problem questions for each class, plus any other materials that the lecturer
may make available to students. These course materials as well as links to relevant cases and
legislation can be found on the Course Materials section of the LEC Webcampus.
LECTURE PROGRAM
The first of 15 lectures will be held on Thursday 15 November 2007.
Lectures will be held on some Mondays and Thursdays during each week of the session as set out on
the next page.
All lectures will be for 3 hours and will start at 6 pm.
The venues for the lectures are set out in the lecture program below. Lectures will be held in the
Eastern Avenue Auditorium (EAA) on the main campus.
For details as to the location of these venues refer to the back page of the Course Information
Handbook for a map of the University of Sydney main campus.
Structure of Lectures
For all lectures, be they for evening students or for distance students at the two weekend schools,
students will be expected to have read, before each lecture, the relevant chapters of the Gooley &
Radan textbook and the cases and statutory provisions set out below in the course outline (p. 9 and
following). The cases are found in the Gooley, Radan & Vickovich casebook. Statutory materials can
be downloaded from the Austlii website.
On each lecture day the teacher will spend approximately the first two-thirds of the allocated time
lecturing on the relevant topic(s). The teacher will not comprehensively cover all the materials that are
covered in the textbook and cases. Rather, the focus will be elaborating on key cases and principles.
Therefore, for students to get the maximum benefit of the lecture they must have read the relevant
materials beforehand.
The last third of the allocated time for each class will be devoted to working through selected problem
questions on the topic(s) for that class. The discussion of problem questions is important for two
reasons. First, it will reinforce and consolidate one’s knowledge and understanding of the topic(s).
Second, it will develop one’s problem solving skills that are so crucial to successfully completing the
assignments and final examination in the subject.
The problem questions for each class can be found on the Contracts page of LEC Webcampus.
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WEEK
1
DATE
Thurs
15 Nov
ROOM
EAA
LECTURE
1
(p. 9)*
TOPIC
Introduction
KEY CASES
2
Mon
19 Nov
EAA
2
(p. 10)
Fact of Agreement
Carlill v Carbolic Smoke Ball Co
Stevenson, Jacques & Co v McLean
2
Thurs
22 Nov
EAA
3
(p. 11)
Consideration;
Intention
Create Legal Relations
to
Williams v Roffey Bros
Ermogenous v Greek Orthodox
Community of SA Inc
3
Mon
26 Nov
EAA
4
(p. 12)
Certainty;
Requirement
Writing; Capacity
of
Booker Industries v Wilson Carparking
Masters v Cameron
3
Thurs
29 Nov
EAA
5
(p. 13)
Express Terms
Oscar Chess v Williams
Toll (FCGT) v Alphapharm
4
Mon
3 Dec
EAA
6
(p. 14)
Codelfa Construction v SRA
Darlington Futures v Deleco Australia
6
Mon
17 Dec
EAA
7
(p. 15)
Implied Terms; Construction of
Terms; Construction of Exclusion
Clauses
Misrepresentation; Mistake
6
Thurs
20 Dec
EAA
8
(p. 16)
Duress;
Unconscionability;
Undue Influence
Edgington v Fitzmaurice
McRae v Commonwealth Disposals
Commission
Crescendo Management v Westpac
Amadio v CBA
STUDY BREAK: Saturday 22 December 2007 to Sunday 13 January 2008
Mon
14 Jan
EAA
9
(p. 17)
Thurs
17 Jan
EAA
7
10
(p. 18)
EAA
11
(p. 19)
Damages
8
Thurs
24 Jan
9
Thurs
31 Jan
EAA
12
(p. 20)
Actions for a Fixed Sum and
Debt; Specific Performance;
Injunction
Dunlop Pneumatic Tyre v Selfridge
Co-operative Insurance Society v Argyll
Stores
10
Mon
4 Feb
EAA
13
(p. 21)
Rectification;
Equitable Estoppel
Coastal Estates v Melevende
Walters (Stores) v Maher
11
Thurs
14 Feb
EAA
14
(p. 22
Torts; Restitution; Misleading or
Deceptive Conduct; Statutory
Unconscionability
Derry v Peek
Pavey & Mathews v Paul
West v AGC (Advances)
12
Thur
21 Feb
EAA
15
(p. 23)
Privity of Contract
Trident General Insurance v McNiece
NZ Shipping Co v AM Satterthwaite
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Discharge
by
Performance;
Discharge
by
Agreement;
Discharge by Breach
Discharge by Frustration;
Illegality
Rescission;
*Refers to the page in the Subject Guide relevant to this topic.
Hoenig v Isaacs
McDermott v Black
Codelfa Constructions v SRA
Yango Pastoral v First Chicago Australia
Amoco Australia v Rocca Bros
Commonwealth v Amann Aviation
Victoria Laundry v Newman Industries
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LEC ORIENTATION
An Orientation for new students is provided by the LEC on Friday 2 November 2007 in the Eastern
Avenue Auditorium (EAA) on the main campus of the University, from 2.30pm to approximately 7pm.
You will find it on the map in your Course Information Handbook.
The Orientation will provide you with an opportunity to understand the roles of the Legal Profession
Admission Board (LPAB) and the Law Extension Committee; the LEC Curriculum Officer will guide
you through the features of the Webcampus; the LEC Law Librarian will explain library resources;
approaches to the course by former and present students will be discussed and you will be able to
meet other students.
A full program of the day can be accessed on the LEC Webcampus and was included in your
Enrolment Package.
LEGAL INSTITUTIONS AND CONTRACTS INTRODUCTORY WEEKEND
SCHOOL
This is the commencement of the teaching program in Legal Institutions and Contracts. All external
students enrolled in these subjects, whether for the first time or returning, should attend where
relevant on the weekend of 3-4 November 2007 in the Eastern Avenue Auditorium (EAA). Evening
lecture students are welcome to attend if they wish
A detailed program of the Weekend was included in your Enrolment Package. It is also available on
the LEC Webcampus.
The classes to be held in Contracts are as follows:
TIME
MAJOR TOPICS
KEY READING
Sunday 4 November 2007 – Eastern Avenue Auditorium (EAA)
9.30am-10.55am
Introduction
11.05am-12.30pm
Fact of Agreement
12.30pm-1.30pm
LUNCH BREAK
1.30pm- 3.20pm
Consideration
3.30pm- 4.30pm
Problem Solving
Carlill v Carbolic Smoke Ball Co
Stevenson, Jacques & Co v McLean
Bressan v Squires
Williams v Roffey
(Contractors)
Bros
and
Nicholls
6
WEEKEND SCHOOLS 1 AND 2
Classes in Contracts are held at both Weekend Schools 1 and 2. The focus of these classes is the
external students. Lecture students may attend on the understanding that weekend classes aim to
cover the topics covered in weekly lectures and are principally for the benefit of external students.
It will not be possible to cover the entire course at the weekend schools. These programs are a
general guide, and may be varied according to need. Readings are suggested to introduce you to the
material to be covered in the lecture, to enhance your understanding of the topic, and to encourage
further reading. You should not rely on them alone.
WEEKEND SCHOOL 1
TIME
MAJOR TOPICS
KEY READING
Saturday 1 December 2007: 8.00am – noon in Eastern Avenue Auditorium
Oscar Chess v Williams
8.00am-9.20am
Express Terms
Toll (FCGT) v Alphapharm
9.30am-10.40am
Construction
Clauses
of
10.45am-11.45am
Misrepresentation
Exclusion
Darlington Futures v Delco Australia
Edgington v Fitzmaurice
Sunday 2 December 2007: noon – 4.00pm in Carslaw Lecture Theatre 157 (CLT157)
McRae v C’th Disposals Commission
12.15pm-1.25pm
Mistake; Duress
Crescendo Management v Westpac
1.30pm- 2.40pm
Illegality
2.45pm-3.55pm
Problem Solving
Amoco Australia v Rocca Bros
WEEKEND SCHOOL 2
TIME
MAJOR TOPICS
KEY READING
Saturday 2 February 2008: 8.00am – noon in Eastern Avenue Auditorium (EAA)
Commonwealth v Amann Aviation
8.00am-9.20am
Damages
Victoria Laundry v Newman Industries
9.30am-10.40am
Actions for a Fixed Sum and
Debt
Dunlop Pneumatic Tyre Co v Selfridge
10.45am-11.45am
Specific Performance
Co-operative Insurance Society v Argyll
Stores
Sunday 3 February 2008: noon – 4.00pm in Eastern Avenue Auditorium (EAA)
Walton (Stores) v Maher
12.15pm-1.25pm
Equitable Estoppel
1.30pm-2.40pm
Privity
Trudent General Insurance v McNiece
2.45pm-3.55pm
Problem Solving
LPAB Contracts examination paper for March
2007
7
TUTORS AND LEGAL SKILLS WORKSHOPS
Skills workshops are offered to assist students in Legal Institutions and Contracts. Susan Carter, our
principle teacher in Legal Institutions, will hold workshops during the Summer Session 2007-08, which
will focus on issue analysis and problem solving. The workshops are complementary to, and not a
repeat of the lectures. They are not designed to teach the law, but rather to teach students how to
apply the law they have learned to answer legal problem questions.
Workshops may be accessed in three ways:

Regular workshops which will be held each Thursday of the session commencing on Thursday 8
November 2007. Workshops will be held in the Law School Lecture Theatre 2 (LSLT2) at the Law
School, from 12.30 -1.30 pm. Workshops are designed to be informal and students are welcome
to come for all or part of the workshop (and bring their lunch.). Students should bring the relevant
tutorial question, downloaded from the Tutors’ Page of the LEC Webcampus. Some January
workshops are offered as web-based package.

These workshops will be reprised on the Sunday morning of each of the weekend schools
(Sunday 2 December 2007 and Sunday 3 February 2008) for those students unable to attend
during the week. The workshops will run from 8 am – 12 noon in CLT 275 on 2 December 2007
and CLT159 on the 3 February 2008. Again, questions should be downloaded from the Tutors’
Page of the LEC Webcampus.

Workshop material may also be accessed via the LEC Webcampus for any students unable to
attend either the week day or the weekend school face to face sessions. The Friday preceding
the relevant workshop, question(s) will be placed on the Tutors’ Page. An approach to answering
the question will be posted on the following Friday allowing students unable to attend an
opportunity to attempt the question and receive the answer via the Webcampus- either at the
time, or later as a package of materials to prepare for the exam. As always, if students have any
questions about this material, they should contact the tutors by email: [email protected]
The workshops will examine strategies for answering the questions, which will usually deal with an
issue that has been covered in Legal Institutions or Contracts. The aim of the workshops is to assist
you in applying legal principles to a set of facts. It is not to teach law. The timetables and room
venues for these workshops are set out on page 51 of the Course Information Handbook. Please note
that the Tutors cannot be expected to answer questions placed on the Legal Institutions or Contracts
Forums.
The Tutors can be contacted by phone between 10am-12 noon on Thursdays during the Summer
Session on (02) 9392 0320 or at any time by email on [email protected].
ASSIGNMENTS
There are two compulsory assignments in Contracts. Assignments must be submitted by the
due dates. The maximum word length for each assignment is 2000 words (inclusive of all
footnotes but not bibliography).
The rules regarding the presentation of assignments and instructions on how to submit an assignment
are set out in the LEC Guide to the Presentation and Submission of Assignments which can be
accessed on the LEC Webcampus. Please read this guide carefully before completing and submitting
an assignment.
8
Completed assignments should be lodged through the LEC Webcampus by 9.00am on the following
dates:
Assignment 1 – 50 Marks
Wednesday 12 December 2007
(Week 5)
Assignment 2 – 50 Marks
Friday 18 January 2008
(Week 7)
To be eligible to sit the examination in Contracts, you must:
a) submit both assignments by the due dates, and
b) demonstrate a sufficient command of the lecture material. This will most usually be
demonstrated by achieving a combined total of 50 or more for the two assignments. In
extraordinary cases it may also be demonstrated by a significant improvement from the
first to the second assignment.
Markers will mark the assignments as quickly as possible. However, please note that many of the
markers are busy practitioners or academics. Do not wait for the return of the first assignment before
commencing the second assignment.
ASSIGNMENT QUESTIONS
To obtain copies of the assignment questions for the Summer Session 2007-08 of the
Contracts course, please follow the instructions below:
1.
Register online with the LEC (see page 27 of the Course Information Handbook for detailed
instructions). Once you have registered, you will have access to all the facilities on the LEC
Webcampus.
2.
Then go into the Webcampus, select the Course Materials section and click on the link to
the Assignment questions for this subject.
9
PRESCRIBED TOPICS AND COURSE OUTLINE
LECTURE 1 (15 November 2007)
Aims and Objectives
At the end of this lecture students should understand the following:
(a)
(b)
(c)
(d)
the definition of contract
the sources of contract law
the various classifications of contracts
the basic principles relating to answering problem questions.
Introduction to contract law
Text: Gooley & Radan, Chapter 1
The introduction to the subject of Contracts looks at the following issues:
(a)
The definition of contract
(b)
The sources of contract law
(c)
The classification of contracts.
There will also be an introduction to problem solving techniques in law.
10
LECTURE 2 (19 November 2007)
Aims and Objectives
At the end of this lecture students should understand the circumstances in which an offer is
made as part of process of creating a contract as well when an offer comes to an end and the
rules as to the acceptance of offers as part of the process of formation of an agreement by
the parties to a contract.
The Fact of an Agreement - The Rules Relating to Offer and Acceptance
Text: Gooley & Radan, Chapter 4
Where a court has to determine whether persons have entered into an agreement the tools of offer and
acceptance are usually used. This technique is not always suitable and in some instances other techniques
will be employed.
1.
The Offer
Gibson v Manchester City Council [1979] 1 All ER 972
Carlill v Carbolic Smoke Ball Co [1893] 1 QB 256
Pharmaceutical Society of Great Britain v Boots Cash Chemists (Southern) [1953] 1 QB 401
Barry v Davies [2001] 1 All ER 944
Blackpool and Fylde Aero Club v Blackpool BC [1990] 1 WLR 1195
2.
Termination of Offers
Stevenson, Jacques and Co v McLean (1880) 5 QBD 346
Dickinson v Dodds (1876) 2 Ch D 463
Mobil Oil v Lyndell Nominees (1998) 153 ALR 198, at 222-228
3.
The Acceptance
R v Clarke (1927) 40 CLR 227
Felthouse v Bindley (1862) 142 ER 1037
Household Fire & Carriage Accident Insurance Co v Grant (1879) LR 4 Ex D 216
Carlill v Carbolic Smoke Ball Co [1893] 1 QB 256
Brinkibon v Stahag Stahl [1983] 2 AC 34
Bressan v Squires [1974] 2 NSWLR 460
4.
Alternatives to Offer & Acceptance
Butler Machine Tool Co v Ex-Cell-O Corpration [1979] 1 All ER 965
11
LECTURE 3 (22 November 2007)
Aims and Objectives
At the end of this lecture students should understand the concepts and rules relating to the
doctrine of consideration and intention to create legal relations as requisite elements in the
requirements for the formation of a contract.
The Fact of an Agreement – Consideration and Intention to Create Legal Relations
Text: Gooley & Radan, Chapters 5 & 6
1.
Consideration
The element of consideration refers to the requirement that a contract is a bargain in the sense that there is
an exchange between the parties of promises or an exchange of a promise for an act for the agreement to
amount to a contract at law. The requirement of consideration is reflected in the major rule that unless a
promisee has given consideration he or she cannot enforce the promisor’s promise. In such a case the
promisee would be held not to have given consideration. The use of a deed allows for the enforcement at
common law (but not in equity) of a promise for which no consideration has been given.
Australian Woollen Mills v The Commonwealth (1954) 92 CLR 424
Coulls v Bagot's Executor and Trustee Co (1967) 119 CLR 460
Pao On v Lau Yi Long [1980] AC 614
Williams v Roffey Bros and Nicholls (Contractors) [1991] 1 QB 1
Foakes v Beer (1884) 9 App Cas 605
2.
Intention to Create Legal Relations
An integral element of a contract at law is that the parties to it must intend their agreement to have legal
force in the sense that each party can take legal action to enforce it. Unless there is an express statement in
the agreement on this matter, there is a presumption that agreements of a family, social or domestic
character are not intended to have legal effect. In all other agreements (commercial agreements) the
presumption is that the parties did intend it to have legal intent. In both situations the presumptions can be
rebutted by evidence to the contrary.
Balfour v Balfour [1919] 2 KB 571
Jones v Padavatton [1969] 2 All ER 616
Esso Petroleum Ltd v Commissioners of Customs & Excise [1976] 1 All ER 117
Ermogenous v Greek Orthodox Community of SA Inc (2002) 209 CLR 95
12
LECTURE 4 (26 November 2007)
Aims and Objectives
At the end of this lecture students should understand the concepts and to rules relating to
requirements that contracts should be certain and complete, the extent which contracts are
required to be in writing, and the capacity of persons, especially minors, to enter into
contracts.
Certainty and Completeness of Contracts, The Requirement of Writing, and Contractual Capacity
Text: Gooley & Radan, Chapters 7, 8 & 9
1.
The Requirement of Certainty and Completeness
A contract that is incomplete or uncertain is void and unenforceable.
Booker Industries v Wilson Parking (Qld) (1982) 149 CLR 600
Masters v Cameron (1954) 91 CLR 353
Whitlock v Brew (1968) 118 CLR 445
Coal Cliff Collieries v Sijehama [1991] 24 NSWLR 1
2
The Requirement of Writing – Do Contracts Have to be in Written Form?
At common law there is no requirement that any contract has to be in written form. However, statute imposes
such a requirement in certain types of contract, a significant example being contracts involving land or
interests in land. However, oral contracts for the sale of land can in some circumstances be enforced.
Conveyancing Act 1919 (NSW), s 54A
Pirie v Saunders (1961) 104 CLR 149
Khoury v Khouri [2006] NSWCA 184
3
Capacity – Who Can Enter into a Contract?
Some classes of persons have a limited or no capacity to enter into a contract. In particular, the limitations on
the contractual capacity of persons under the age of 18 (minors) is to be analysed.
Minors (Property and Contracts) Act 1970 (NSW)
13
LECTURE 5 (29 November 2007)
Aims and Objectives
At the end of this lecture students should understand the following:
(a)
(b)
(c)
(d)
the operation of the rule excluding the proof of contractual terms by oral evidence in
relation to written contracts
the circumstances in which pre-contractual statements amount to terms of a contract
the formation of collateral contracts
the principles for the incorporation of contractual terms.
Express Terms
Text: Gooley & Radan, Chapter 10
1.
Express Terms
This topic is concerned with establishing the express terms of the contract between the parties to the
contract. In written contracts additional express terms may be added by oral evidence unless the oral
evidence rule applies to exclude this possibility. However, it needs to be established first that such evidence
establishes that the parties intended pre-contractual statements to be express terms and were not merely
representations. Alternatively such statements may amount to collateral contracts – contracts that are
collateral to the main contract between the parties. Even in situations where one party intends a statement to
be a part of the contract questions arise as to whether that party has done enough to have the term
incorporated into the contract.
Ellul and Ellul v Oakes (1972) 3 SASR 377
Oscar Chess v Williams [1957] 1 All ER 325
SRA v Heath Outdoor Ltd (1986) 7 NSWLR 170
J J Savage and Sons v Blakney (1970) 119 CLR 435
Hoyt's v Spencer (1919) 27 CLR 133
Toll (FGCT) Pty Ltd v Alphapharm Pty Ltd (2004) 79 ALJR 129
Curtis v Chemical Cleaning and Dyeing Co [1951] 1 KB 805
Thornton v Shoe Lane Parking [1971] 2 QB 163
Parker v South Eastern Railway Co (1877) 2 CPD 416
D J Hill & Co Pty Ltd v Walter H Wright Pty Ltd [1971] VR 749
14
LECTURE 6 (3 December 2007)
Aims and Objectives
At the end of this lecture students should understand the following rules and principles by
which terms are implied into a contract as well as the principles by which terms of a contract,
especially exclusion clauses, are construed or interpreted.
Implied Terms, Construction fo Contractual Terms Generally, and Construction of Exclusion Clauses
Text: Gooley & Radan, Chapters 11, 12 & 13
1.
Implied Terms
Terms may also arise by implication, either under common law principles or pursuant to statute.
Furthermore, terms can also be implied because of the existence of a custom in a particular industry, trade
or locality.
Codelfa Construction v State Rail Authority of New South Wales (1982) 149 CLR 337
Byrne v Australian Airlines Ltd (1995) 185 CLR 410
Con-Stan Industries of Australia P/L v Norwich Winterthur Insurance (Australia) P/L (1986) 160 CLR
226
2.
The Meaning of Terms of a Contract
ABC v Australasian Performing Right Association Ltd (1973) 129 CLR 99
3.
The Legal Effect of Terms
Associated Newspapers Ltd v Bancks (1951) 83 CLR 322
Hongkong Fir Shipping Co v Kawasaki Kisen Kaisha [1962] 2 QB 26
Perri v Coolangatta Investments P/L (1982) 129 CLR 99
4.
The Construction of Exclusion Clauses
Darlington Futures v Delco Australia (1986) 161 CLR 500
Sydney City Council v West (1965) 114 CLR 481
Alderslade v Hendon Laundry Ltd [1945] KB 189
White v John Warwick & Co [1953] 2 All ER 1021
Trade Practices Act 1974 (Cth), s 68-68A
15
LECTURE 7 (17 December 2007)
Aims and Objectives
At the end of this lecture students should, as part of the broader topic of vitiating factors, have
an understanding of the following:
(a)
(b)
the law relating to misrepresentations
law of mistake at both common law and equity.
The topic of vitiating factors relates to factors that affect the quality of the consent given to the
entry into of a contract. In most cases the consequence of the relevant factor is that the
contract is voidable. In cases of mistake at common law the contract will be void as from the
very beginning (ab initio). The distinction between voidable and void ab initio has particular
consequences for the rights of third parties to the contract who have innocently acquired
property that has in the meantime passed between the parties to the contract.
Misrepresentation and Mistake as Vitiating Factors
Text: Gooley & Radan, Chapters 14 & 15
1.
Misrepresentation
Balfour & Clark v Hollandia (1978) 18 SASR 241
Edgington v Fitzmaurice (1885) 29 Ch D 459
Smith v Land and House Property Corp (1884) 28 Ch D 7
Gould v Vaggelas (1984) 157 CLR 215
Redgrave v Hurd (1881) 20 Ch D 1
Nicholas v Thompson [1924] VLR 554
2.
Mistake
(a)
Common Mistake
McRae v Commonwealth Disposals Commission (1951) 84 CLR 377
Associated Japanese Bank (Int) v Credit du Nord SA [1988] 3 All ER 902
Bell v Lever Brothers [1932] AC 161
Great Peace Shipping Ltd v Tsavliris (International) Ltd [2002] QB 679
(b)
Mutual Mistake
Scriven Brothers & Co v Hindley [1913] 3 KB 564
(c)
Unilateral Mistake
Cundy v Lindsay (1878) 3 App Cas 459
Shogun Finance Ltd v Hudson [2004] 1 All ER 215
Taylor v Johnson (1983) 151 CLR 422
Petelin v Cullen (1975) 132 CLR 355
16
LECTURE 8 (20 December 2007)
Aims and Objectives
At the end of this lecture students should, as part of the broader topic of vitiating factors, have
an understanding of the law relating to duress, unconscionable bargains and undue influence.
In each of these cases the effect of the relevant factor is that the contract is voidable.
Duress, Unconscionable Bargains and Undue Influence as Vitiating Factors
Text: Gooley & Radan, Chapters 16, 17 & 18
1.
Duress
Universe Tankships Inc of Monrovia v International Transport Workers Federation [1983] 1 AC 366
Barton v Armstrong [1976] AC 104
Hawker Pacific Pty Ltd v Helicopter Charter Pty Ltd (1991) 22 NSWLR 298
Crescendo Management Pty Ltd v Westpac Banking Corp (1988) 19 NSWLR 40
North Ocean Shipping Co v Hyundai [1979] QB 705
2.
Unconscionable Bargains
Blomley v Ryan (1956) 99 CLR 362
Commercial Bank of Australia v Amadio (1983) 151 CLR 447
Elkofairi v Permanent Trustee Co [2002] NSWCA 413
Louth v Diprose (1992) 174 CLR 621
Bridgewater v Leahy (1998) 194 CLR 437
3.
Undue Influence
Johnson v Buttress (1936) 56 CLR 113
Lancashire Loans Ltd v Black [1934] 1 KB 380
Westmelton (Vic) P/L v Archer & Shulman [1982] VR 305
Yerkey v Jones (1939) 63 CLR 649
Garcia v National Australia Bank Ltd (1998) 194 CLR 395
17
LECTURE 9 (14 January 2008)
Aims and Objectives
At the end of this lecture students should, as part of the broader topic of discharge, have an
understanding of the following:
(a)
(b)
(c)
(d)
the order of performance in relation to contractual obligations
the meaning of performance at common law and qualifications to its applications
the discharge of contracts by agreement
the discharge of contract by breach.
The topic of discharge covers the means by which parties to a contract are discharged or
released from liability under the contract.
Discharge by Performance, Agreement and Breach
Text: Gooley & Radan, Chapters 19, 20 & 21
1.
Discharge by Performance
Louinder v Leis (1982) 149 CLR 509
Cutter v Powell (1795) 101 ER 573
Tramways Advertising Pty Ltd v Luna Park (NSW) Ltd (1938) 38 SR (NSW) 632
Hoenig v Isaacs [1952] 2 All ER 176
2.
Discharge by agreement
Crawford Fitting Co v Sydney Valve & Fitting P/L (1988) 14 NSWLR 438
Perri v Coolangatta Investments Pty Ltd (1982) 149 CLR 537
McDermott v Black (1940) 63 CLR 161 at 183-184
3.
Discharge by Breach of Contract
Foran v Wight (1989) 168 CLR 385
Sargent v ASL Developments Ltd (1974) 131 CLR 634
DTR Nominees Pty Ltd v Mona Homes P/L (1978) 138 CLR 423
Heyman v Darwins Ltd [1942] AC 356
Legione v Hateley (1983) 152 CLR 406
18
LECTURE 10 (17 January 2008)
Aims and Objectives
At the end of this lecture students should, as part of the broader topic of discharge, have an
understanding of the following:
(a)
(b)
the discharge of contractual obligations by frustration
the effect of frustration.
The topic of illegality deals with circumstances under which statute and common law
principles declare certain classes of contract either illegal or void. Public policy concerns are
the basis of these principles. At the end of this lecture students should have an understanding
of the circumstances in which contracts are illegal both pursuant to statute and common law
principles, the effect of illegality on contractual obligations, the recovery of property that has
passed pursuant to illegal contract, and the circumstances and effects of contracts that are
void on common law grounds.
Discharge by Frustration; Illegality
Text: Gooley & Radan, Chapters 22, 23, 24 & 25
1.
Discharge by frustration
Chapman v Taylor [2004] NSWCA 456
Krell v Henry (1903) 2 KB 740
Codelfa Construction v State Rail Authority of New South Wales (1982) 149 CLR 337
Taylor v Caldwell (1863) 122 ER 309
Fibrosa Spolka Akcyjna v Fairbairn Lawson Combe Barbour [1943] AC 32
Frustrated Contracts Act 1978 (NSW)
2.
Illegal Contracts
George v Greater Adelaide Land Development Co Ltd (1929) 43 CLR 91
Re Mahmoud and Ispahani [1921] 2 KB 716
Yango Pastoral Co v First Chicago Australia (1978) 139 CLR 410
St John Shipping Corp v Joseph Rank [1957] 1 QB 267
Singh v Ali [1960] AC 167
Wilkinson v Osborne (1915) 21 CLR 89
A v Hayden (1984) 156 CLR 532
Nelson v Nelson (1995) 184 CLR 538
Fitzgerald v F J Leonhardt Pty Ltd (1997) 189 CLR 215
Bowmakers Ltd v Barnet Instruments Ltd [1945] 1 KB 65
Alexander v Rayson [1936] 1 KB 169
Thomas Brown and Sons v Fazal Dean (1962) 108 CLR 391
3.
Contracts void on public policy grounds
Nordenfelf v Maxim Nodenfelt Guns & Ammunition Co Ltd [1894] AC 535
Lindner v Murdock’s Garage (1950) 83 CLR 628
Amoco Australia v Rocca Bros Motor Engineering Co (1973) 133 CLR 288
Restraints of Trade Act 1976 (NSW)
19
LECTURE 11 (24 January 2008)
Aims and Objectives
Common law damages involves the innocent party accepting a breach of contract and being
compensated for losses suffered as a result of such breach. Upon proof of a breach an
innocent party is entitled to an award of damages. The principles relating to common law
damages are fundamentally concerned with assessment of the amount of compensation to be
awarded to the innocent party. Equitable damages can also be awarded.
At the end of this lecture students should have an understanding of the following:
(a)
(b)
(c)
(d)
(e)
the compensation principle as the basis for the recovery of damages
the nature of interests protected in an award of damages
the requirement that the breach must cause the losses sought to be recovered
factors that affect the quantum of damages awarded
the principles governing the recovery of equitable damages.
Damages
Text: Gooley & Radan, Chapter 26
1.
Common Law Damages
Paper Reclaim Ltd v Aotearoa International Ltd [2006] 3 NZLR 188
Johnson v Perez (1988) 166 CLR 351
Howe v Teefy (1927) 27 SR (NSW) 301
Baltic Shipping Co v Dillon (1992) 176 CLR 344
McRae v Commonwealth Disposals Commission (1951) 84 CLR 377
The Commonwealth v Amann Aviation (1991) 174 CLR 64
Bellgrove v Eldridge (1964) 90 CLR 64
Hadley v Baxendale (1854) 154 ER 145
Victoria Laundry (Windsor) v Newman Industries [1949] 2 KB 528
Stuart Pty Ltd v Condor Commercial P/L [2006] NSWCA 334
Simonius Vischer & Co v Holt & Thompson [1979] 2 NSWLR 322
British Westinghouse& Manufacturing Co v Underground Electric Railways Co [1912] AC 673
The Mihalis Angelos [1971] 1 QB 164
2.
Equitable Damages
Supreme Court Act 1970, s 68
Johnson v Agnew [1980] AC 367
20
LECTURE 12 (31 January 2008)
Aims and Objectives
Apart from an action in damages at common law, a plaintiff may be able to recover sums of
money by way of actions for the recovery of fixed sums and in debt.
At the end of this lecture students should have an understanding of the following:
(a) the principles governing the validity of the parties’ contractual agreement as to the
measure of damages in the event of a breach
(b) the principles for the recovery of debts.
As an alternative to common law damages, equitable remedies to enforce the contract may
be available to a plaintiff. At the end of this lecture students should have an understanding of
the following:
(a)
(b)
the nature of the equitable remedy of specific performance
the principles for awarding the equitable remedy of injunction for the enforcement of
negative contractual obligations.
Actions for Fixed Sums and Debt; Specific Performance & Injuctions
Text: Gooley & Radan, Chapters 27, 28 & 29
1.
Actions for a Fixed Sum & Debt
Dunlop Pneumatic Tyre Co v New Garage and Motor Co [1915] AC 79
McDonald v Dennys Lascelles Ltd (1933) 48 CLR 457
White & Carter (Councils) Ltd v McGregor [1962] AC 413
2.
Specific Performance
Beswick v Beswick [1968] AC 58
Giles v Morris [1972] 1 All ER 960
Co-operative Insurance Society v Argyll Stores (Holdings) Ltd [1998] AC 1
Mehmet v Benson (1965) 113 CLR 295
Price v Strange [1978] Ch 337
3.
Injunction
Warner Brothers Pictures v Nelson [1937] 1 KB 209
Curro v Beyond Productions P/L (1993) 30 NSWLR 337
Page One Records Ltd v Britton [1967] 3 All ER 822
21
LECTURE 13 (4 February 2008)
Aims and Objectives
At the end of this lecture students should have an understanding of the following equitable
remedies and principles relating to contracts:
(a) the remedy of rectification of contract
(b) the principles permitting rescission of contracts
(c) relief based upon principles of equitable estoppel.
Rectification, Rescission & Equitable Estoppel
Text: Gooley & Radan, Chapters 30, 31 & 32
1.
Rectification
Muriti v Prendergast [2005] NSWSC 28
George Wimpey UK Ltd v V I Construction Ltd [2005] EWCA Civ 77
2.
Rescission
Coastal Estates v Melevende [1965] VR 433
Alati v Kruger (1955) 94 CLR 216
Vadasz v Pioneer Concrete (SA) Pty Ltd (1995) 184 CLR 102
3.
Equitable Estoppel
Waltons Stores (Interstate) v Maher (1988) 164 CLR 387
Je Maintiendrai v Quaglia (1980) 26 SASR 101
Giumelli v Giumelli (1999) 196 CLR 101
22
LECTURE 14 (14 February 2008)
Aims and Objectives
This lecture deals with non-contractual remedies that provide relief in circumstances not
dependant upon establishing a contract, in particular, torts-based common law principles,
restitution, and statutory principles under a variety of federal and state acts, especially the
Trade Practices Act 1974 (C’th) and the Contracts Review Act 1980 (NSW), dealing with
unjust contract.
Torts-Based Remedies; Restitution & Statutory Based Remedies
Text: Gooley & Radan, Chapters 33, 34, 35 & 36
1.
Torts-Based Remedies
(a)
Deceit
Derry v Peek (1889) 14 App Cas 337
(b)
Negligence
Esso Petroleum v Mardon [1976] QB 1
Koufos v C Czarnikow [1969] 1 AC 350
H Parsons (Livestock) Ltd v Uttley Ingham & Co [1978] 1 QB 791
(c)
Interference With Contractual Relations
OBG Ltd v Allan [2007] 2 WLR 920
Zhu v Treasurer of NSW (2004) 218 CLR 530
2.
Restitution
Pavey and Mathews v Paul (1987) 162 CLR 221
Sumpter v Hedges [1898] 1 QB 673
David Securities P/L v Commonwealth Bank of Australia (1992) 175 CLR 353
Steele v Tardiani (1946) 72 CLR 386
3.
Misleading & Deceptive Conduct
Trade Practices Act 1974 (Cth), ss. 52, 80, 82, 87
Fair Trading Act 1987 (NSW), ss. 42, 65, 68, 72
Marks v GIO (1998) 196 CLR 494
Henjo Investments v Collins Marrickville (1988) 79 ALR 83
Taco Co of Australia v Taco Bell Pty Ltd (1982) 42 ALR 177
Butcher v Lachlan Elder Realty Pty Ltd (2004) 218 CLR 592
Henville v Walker (201) 206 CLR 459
4.
Statutory Unconscionability
Trade Practices Act 1974 (C’th), ss 51AAB, 51AA, 51AB, 51ACAA
Australian Securities & Investments Commission Act 1989 (C’th), s 12BAB
Contracts Review Act 1980 (NSW), ss. 6, 7, 9, 14, 16, 17, 21
ACCC v Berbatis Holdings P/L (2003) 214 CLR 51
Baltic Shipping Co v Dillon (1991) 22 NSWLR 1
Industrial Relations Act 1996 (NSW), s 106
Brown v Rezitis (1971) 127 CLR 157
Retail Leases Act 1994 (NSW), ss 62A, 62B
23
LECTURE 15 (21 February 2008)
Aims and Objectives
At the end of this lecture students should understand the following:
a)
b)
c)
d)
e)
the meaning of the doctrine of privity of contract
the relationship of the privity doctrine to the consideration rule that consideration must
move from a promisee
the remedies available at common law and equity to a promisee when enforcing a
contractual promise by a promisor to benefit a person who is not a party to the contract
the ‘exceptions’ by which a person not a party to a contract can take enforcement
action in relation to a contractual promise for his or her benefit
assignment of contractual rights and liabilities.
Third Party Right: Privity of Contract
Text: Gooley & Radan, Chapter 37
Tweddle v Atkinson (1861) 121 ER 762
Dunlop Pneumatic Tyre Co Ltd v Selfridge & Co Ltd [1915] AC 847
Trident General Insurance Co v McNiece Bros (1988) 165 CLR 107
Coulls v Bagot's Executor and Trustee Co (1967) 119 CLR 460
Scruttons Ltd v Midland Silicones Ltd [1962] AC 446
New Zealand Shipping Co v A M Satterthwaite and Co (The Eurymedon) [1975] AC 154