澳大利亚商法Lecture 4 Contract Law

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Capacity - Corporations
– We will cover corporations in more detail in the second half of the semester
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Generally corporations have virtually the same legal capacity as natural persons under s.124 of the Corporations Act 2001 (Cth)
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• Statements that do form part of the contract: • Terms
– Create contractual obligations between the parties
• Term or Representation?
– This will depend on the intentions of the parties, determined by applying an objective test of a reasonable person
• To determine whether such a contract is valid the courts examine the contract as a whole:
• Check the beneficial terms outweigh the onerous terms:
McLaughlin v Darcy (1918)- text p.313
• Therefore the contract is voidable
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To void the contract mentally unsound or intoxicated person will need to prove that at the time the contract was entered into:
Contract Law: Promissory Estoppel, Capacity, Construction and Consent
Lecture Week 4 Legal Issues for Managers
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Promissory Estoppel
• Promissory Estoppel will allow a promise to be enforced even though the promisee has not provided good consideration for that promise • The focus of promissory estoppel is the unconscionable conduct of one party which is relied upon by another to the latter party’s detriment • Promissory estoppel can be used as either a:
Statements: Representation or Term?
• The courts distinguish between statements that are not actionable and do not form part of the contract and those that are actionable Statements that do not form part of the contract include:
due to their mental state or drunkenness, they were unable to understand the nature of the contract; and this was known, or ought to have been known, by the other party
Valid Contracts with Infants
Necessaries:
• Includes articles and services necessary for the reasonable comfort of the infant, as well as basic items of food, clothing and shelter The plaintiff must establish that: – The goods or services could be necessaries
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Capacity - Mentally Unsound and Intoxicated Persons
• If the contract is for the supply of necessaries, the person who is mentally unsound or intoxicated must pay a reasonable amount for them If the goods are not for necessaries, and If, at the time of making a contract the person is mentally unsound or intoxicated s/he may be able to repudiate the contract when they are again of sound mind or sober.
Corpe v Overton (1833)
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Those contracts which are binding unless REPUDIATED are limited to:
• Purchase and lease of land • Purchase of shares in a company and • Partnerships
– shield to defend an action:
Central London Property Trust v High Trees House Ltd (1947)
– or a sword to commence an action:
Waltons Stores (Interstate) Ltd v Maher (1988)- text p.305-6
• This is a question of law:
Bojczuk v Gregorcewicz (1961)- text p.312
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The goods or services were necessaries at the time of sale or delivery
• This is a question of fact:
• Decide whether there is benefit to the infant:
Hamilton v. Lethbridge (1912); but cf Mercantile Union Guarantee Corp Ltd v Ball (1937)
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Contracts with Infants – Voidable Contracts
O’Connor v Hart [1985]
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Construction of the Contract Element 5
A. Express Terms
B. Implied Terms
C. Exclusion Clauses
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A. Express Terms
Express terms are one that are specifically identified and agreed upon by the parties.
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Contracts with Infants – Void Contracts
• Contract cannot generally be enforced during infancy, nor after attaining majority unless the (now) adult elects to RATIFY it At common law an infant is not liable on a contract to repay a loan, even if the loan has been given for the purchase of necessaries The common law position has been modified by statute in all jurisdictions
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Capacity - Infants (or minors)
• Contracts with infants/minors may be classified under the following headings:
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Statute: Age of Majority Act 1974 (Qld) Valid Contracts can be created by the infant paying cash or entering into contracts for necessaries and beneficial contracts 4 of service
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Hale Waihona Puke Capacity of the Parties [Element 4]
• Do the parties have capacity to contract?
• Under the common law (and under some states’ statute law) there are classes of people who are treated as NOT having full contractual capacity which affects the validity of any contracts entered into by those persons
• Rescission only ends future liability
• any obligations already accrued must be satisfied
Steinberg v Scala (Leeds) Ltd (1923)
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Any money paid by the infant cannot be recovered unless a total failure of consideration can be shown
– – Representations which are pre-contractual statements made by the offeror to induce the offeree to enter into the contract and Puffs which are statements no reasonable person would take seriously: “Drink milk and fly through the day”
Capacity - Bankrupts
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If a bankrupt wishes to obtain goods or services of more than $3,000 in value, they must disclose to the lender that they are an undischarged bankrupt under the Bankruptcy Act 1966 (Cth)
Scarborough v Sturzaker (1905)
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Contracts with Infants – Valid Contracts
Beneficial Contracts of Service
• Examples include: contracts of employment, apprenticeships training or education