Contract Law Essays Text

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Radio station ques station , put an identification tag on a large bass fish it named big bertha and placed it in a nearby lake the lake as part of a promotional fishing contest. Station advertised the contest during radio broadcasts, but required no formal entry. The advertisement stated that anyone who caught big bertha on hook and line and presented it to station would be entitled to a $5,0 cash price. While driving together to the lake, sam said that he was having problems paying his mortgage and owed past due taxes on his property blackacre. Sam told betty, i will give you a deed to blackacre if you agree to pay all past due taxes and to make all future mortgage payments due on blackacre.

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Betty had always wanted to own blackacre and she immediately replied, i agree! betty did not intend to fish but while sitting in sam's boat she picked up an extra fishing pole and decided to drop a fishing line into the lake to see what might happen. Sam saw this and yelled, you may have hooked big bertha! reel her in and you will win the $5,0 prize offered by ques. When betty presented big bertha and attempted to claim the $5,0 prize, station refused to pay her because she had not actually participated in the contest but was merely on a social outing when she caught big bertha. After returning from the lake, betty paid the past due taxes on blackacre and immediately moved in where she has continuously and exclusively resided. Besides regularly paying the mortgage, betty added a new family room and new front yard landscaping to the property that permanently improved blackacre, greatly enhancing its appearance and value. However, when betty asked sam to give her the deed to blackacre as he had promised, sam refused to do so.

This paper analyses the stated fact pattern against the matrix of contract law with a view to answering the two specific questions posed. Pertinent case law and authority is applied in de constructing the scenarios and forming sound conclusions. It stands to reason that one of the formal components of any enforceable contract is a valid offer. It is submitted that station made such an offer when it advertised that anyone who caught big bertha on hook and line and presented it to station would be entitled to a $5,0 cash prize.

It is settled law that competent offers may be made not only to a specific person or specific group of people, but also to the world at large as in this case. There is a general rule that advertisements constitute invitations to treat rather than offers. However, in cases where the advertisement in question comprises a clear and certain set of terms and a commitment that objectively suggests an intention to establish legal relations, especially in the case of a unilateral contract such as the one under consideration, then an enforceable offer may be found.

Foundation authorities for this principle and exception to the general rule include carlill v carbolic smoke ball company 1893. Hunter v general accident, fire and life assurance corporation 1909 and wood v letrick 1932. In these cases general offers were made to the world at large by means of advertisement. Which were deemed accepted to create binding contracts by individuals who fulfilled the terms of those advertisements.

Leaving all peripheral circumstances aside, betty has manifestly fulfilled these terms. Station's reason for refusing to pay betty, because she had not actually participated in the contest but was merely on a social outing when she caught big bertha, is materially irrelevant. The original offer contained no stipulation, whether express or implied, concerning the need to engage in formal participation, or concerning the need to in some way register participation or formally accept the offer. As in carlill, it is submitted that performance of the terms of the offer will be deemed to constitute its legal acceptance a rule of policy flowing from williams v carwardine 1833 .

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Station has only itself to blame, if it wished to run the competition under more specific and formal terms regarding entry and participation, it need only have specified those terms ab initio in its advertisements. On the facts presented, it is accordingly advised that betty will be able to enforce station's promise to pay $50. It is important to analyse the context and terms of the original discussion between sam and betty concerning the transfer of the deeds of blackacre. It does appear that sam made a valid offer to betty and that betty accepted without equivocation. Certainty of terms and intention to create legal relations are essential components of contract formation.

It seems that the terms laid down by sam are both clear and certain, and thus capable of judicial enforcement. However it is inferred for the purposes of this analysis that it is the deed of ownership of blackacre that was intended. This inference is supported by betty's subsequent actions in taking up exclusive residence in the property, paying debts connected with it and developing it.

The context of the original discussion, being a car journey en route to an outing, does suggest a social and casual situation and this does of itself mitigate against an intention to bind to a contract. Moreover the relationship between betty and sam, which is left unspecified on the facts, is also of bearing if the pair are related or, perhaps, close friends. However, these indications can, it is submitted be overridden and swept aside by the actual content and terms of the conversation, which are very clear, precise and unambiguous, and which certainly suggest an indication to bind. Consideration is also a fundamental component of most contracts and betty supplies this by paying all past due taxes and taking up mortgage payments due on blackacre. In thomas v thomas 1842 consideration is defined as follows: 'consideration means something which is of some value in the eye of the law, moving from the plaintiff it may be some detriment to the plaintiff or some benefit to the defendant, but at all events it must be something moving from the plaintiff.' in currie v misa 1875. It is further manifest that betty has suffered a detriment, both in paying these taxes and in paying the mortgage on the property over the period since accepting sam's offer.

In supplying this consideration it is submitted that betty has complied with all the terms of sam's offer. In this regard it is clear that betty has paid all past due taxes , however, although she is regularly paying the mortgage it seems that the mortgage has not yet been discharged and therefore she has not made all future mortgage payments , to quote sam's original words. Sam did not say that betty must make all future mortgage payments before he would transfer the deed to her. Section 2 of the law of property miscellaneous provisions act 1989 stipulates that contracts for the sale or disposition of an interest in land must be made in writing. Section 40 2 of the law of property act 1925 had preserved a role for the doctrine of part performance which mitigates hardships that would flow from situations such as that which betty finds herself in. This doctrine is noted by beale as follows: where the claimant has partly performed an oral contract required by statute to be evidenced in writing, in the expectation that the defendant would perform the rest of the contract, the court will not allow the defendant to escape from his contract upon the strength of the statute, but may order specific performance of the oral contract. However, section 2 8 of the 1989 act vitiated this doctrine, indicating that the courts prefer to preserve certainty rather than prevent hardship.

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That said, section 2 5 does preserve a role for resulting and constructive trusts and betty may benefit from the creation of a constructive trust by law on the facts. In betty's case the court is likely to turn to section 2 5 to ensure that the general rule in section 2 is not used as a cloak to conceal fraud. In yaxley v gotts 20 it was held: i do not think it inherent in a social policy of simplifying conveyancing by requiring the certainty of a written document that unconscionable conduct or equitable fraud should be allowed to prevail. It is advised that the court will probably find that the oral agreement between betty and sam is void and unenforceable due to section 2 of the 1989 act, but that effect could nonetheless be given to the agreement on the basis of a constructive trust as a consequence of betty's extensive reliance and performance on the facts. This is not a case of promissory estoppel, because sam's undertaking does not relate to an alteration to a pre existing contract with betty combe v combe 1951 . However, it is confidently advised that betty will be able to enforce the agreement between them, not under ordinary principles of contract, but by virtue of a constructive trust on the basis of the exception in section 2 5 of the 1989 act, as articulated and applied in yaxley.

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