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Cover Business Law Concentrate

2. Contract I: essential features of a contract  

Each Concentrate revision guide is packed with essential information, key cases, revision tips, exam Q&As, and more. Concentrates show you what to expect in a law exam, what examiners are looking for, and how to achieve extra marks. This chapter discusses the essential features of a contract. Offer and acceptance are the first stages in establishing an agreement that may form a legally binding contract. An offer may be accepted at any point until it is terminated. Acceptance can only be made by the offeree or their agent. Consideration is the bargain element of a contract and may be referred to as the ‘price of a promise’. The parties must intend for an agreement to establish legal relations to create an enforceable contract. Presumptions exist in relation to social/domestic agreements and business/commercial agreements.

Chapter

Cover Card & James' Business Law

6. The formation of the contract  

This chapter examines the legal requirements relating to the formation of a contract. It discusses the five essential elements of a contract, namely offer, acceptance (offer and acceptance are collectively referred to as ‘agreement’), certainty, consideration, and the intention to create legal relations. It analyses these individual requirements in detail and considers the courts’ approach in determining whether an enforceable contract is present or not. This chapter also explains the principles of different types of contracts, namely the distinction between bilateral and unilateral contracts, and how the normal rules of contractual formation are modified in the cases involving unilateral contracts.

Chapter

Cover Business Law

6. Establishing the Contract: Consideration, Intention to Create Legal Relations, and Certainty Of Terms  

This chapter is a continuation of the previous one, and further discusses the essential features of a legally binding, or valid, contract. It puts particular importance on the meaning of ‘consideration’, which is what makes a promise or agreement a ‘bargain’ and, therefore, enforceable. The courts are not bound to, and will not, consider a ‘bare promise’. Parties to a contract must intend it to be legally binding, and not just be social or domestic agreement, and such contracts must contain certain terms that identify the rights and obligations of both parties. Without an understanding of these crucial elements, agreements may be concluded but they will not create an enforceable contract. Also, although a contract is enforceable by those parties to it, this right can be extended to third parties if the contract has been made for the benefit of these parties.