Contract Law

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What's a contract?

Law, as it currently exists within modern day, western, neoliberal society, must function within the framework of captial itself. Likewise, contracts operate on this basis. With trading, both parties (theoretically) lose a less valuable thing for something they value more, resulting in a mutal increase of wealth(fare). That's essentially what contracts are, an exchange - and it's likely that even today you have engaged in multiple contracts, whether that be the purchase of a coffee or the payment of your bus fare.

Contract law supports contracts by allowing parties to create legally binding agreements enforceable by law. If you wish to delve into legal theory there's a plurality of legal theroies of why contracts should be enforced, id est:

What makes a contract?

Multiple factors need to be satisfied to make an enforceable contract:

Intention - does the objective or subjective a contract make?

When judging upon the parties' intentions to contract, there are two methods the courts usually take. The Objective approach, or the "reasonable person test" views the case

"not upon their subjective state of mind, but upon consideration of what was communicated between them by words or conduct, and whether that leads objectively to a conclusion that they intended to create legal relations and had agreed upon all the terms to which they regarded or the law requires as essential for the formation of legally binding relations."
(Lord Clarke SCJ in RTS Flexible Systems Ltd v Molkerei Alois Müller GmbH & Co KG (UK Production) [2010]

Obviously there are exceptions to this rule, and there are obvious issues if the viewpoints from the parties are not considered at all. Nevertheless, the objective test somewhat ensures a regular playing field, such that "A person cannot get out of a contract by saying ‘I did not intend to contract’, if by his words has done so." (Lord Denning in Storer v Manchester City Council [1974])


The Subjective approach is rarely, if never, used in contract interpretation at all; for reasons mentioned above. Nevertheless, there are limited applications of it, such as:

  1. Knowledge: One party knows that the terms proposed are not a true expression of the other party's will (ie Hartog v Colin & Shields (1900), where Colin & Shields mistakenly wrote a better deal than intented, and Hartog attempted to hold them to this good deal. Colin aruged that Hartog was aware of this mistake, and attempted to capitalise on a deal never intended. The court found in favour of Colins.)
  2. Ambiguity: In cases where even the 'reasonable observer' would be in doubt as to the parties' meanings (ie Raffles v Wickelhaus [1864],Falck v Willams)
  3. Mistaken Terms: As seen on the tin, where a party is mistaken to the terms of the agreement (ie Smith v Hughes (1871))

There are generally two types of contracts: Bilateral Contracts, where both parties bear contractual obligations under contract (this is the contract one typically imagines); and Unilateral Contracts, where only one party bear a major contractual obligations (think a newspaper reward ad for a lost dog)

Agreement: Offer

An offer is "A willingness to contract on terms that will be binding once addressed, made through writing, oral communication, conduct, etc"

An offer usually involves a promise of some sort, seen notably in the similar but different cases of Storer v Manchester City Council [1974] and Gibson v Manchester City Council [1979].

A contract is comprised of four different- five different? im not quite sure, i have to check - things, ill fix up this page whenever idk

very much work in progress, if you haven't yet noticed