Exam 6: The Elements of a Contract: Consensus and Consideration

In the Pharmaceutical Society of Great Britain v. Boots Cash Chemists (Southern) Ltd., case, it was decided that goods displayed on the shelf in a self-service merchandising situation were an invitation to treat rather than an offer. Discuss.

Which of the following is an ingredient necessary to form a contract?

A revocation of an offer is effective only when it has been communicated to the offeree.

To what does a "standard form contract" refer?

A binding contract that will subsequently be put into a more formal document is known as ________.

With regard only to the requirement of consideration, which one of the following would be a binding contract?

Sam had been a friend of Joe's for a considerable period of time and had often accompanied him as he sailed his classic yacht. Sam had often communicated to Joe how much he would like to have the yacht. On Friday night, a friend told Sam that Joe had suffered some business reverses and was going to have to get rid of the yacht. Sam immediately wrote Joe a letter offering to purchase the yacht for $125,000. Unknown to Sam, Joe had written Sam a similar letter offering to sell the yacht for $125,000. These two letters passed in the mail. Sam received Joe's letter at about 12 noon on Saturday, and Joe received Sam's letter at about 2:30 p.m. on Saturday. Are these people bound in contract? Explain.

The courts may enforce an unfair bargain.

The postbox rule makes it clear that, when people choose to communicate by mail, they take the risk of delay or loss, and the acceptance as a result will be binding only when or if received.

A contract is a single promise, made by one person to another, enforceable in court.

If the mail is a reasonable means for accepting an offer, is there a contract formed when the offeror drops a letter of revocation in the mailbox at the very same instant that the offeree drops a letter of acceptance in the mailbox? Explain.

When is an offer incapable of being revoked?

Canada's Uniform Electronic Commerce Act creates rights and obligations with respect to electronic commerce transactions within Canada.

Indicate the correct statement about consideration.

An offer will end when the subject matter of the offer is sold to someone else.

Generally, acceptance must be communicated to the offeror to be effective unless there has been a history of similar relations between the parties.

Joe owed Sam $500. Two days before the money was due, he came to Sam and told him he couldn't pay the $500, but if Sam would accept $300 right then, in full satisfaction of the debt, he would pay him that amount. Sam agreed, then later sued for the other $200. Will he win?

Sarah wanted an antique lamp for her bedroom. While in a second-hand shop, she saw a lamp that she really wanted marked $100. She offered the owner $75 for it. He said "I'll take $95." She answered "$80!" He said, "Lady, you're pushing me a bit, aren't you? I'll take $90, that's it." She said "OK I'll pay $90 if you throw in this old 'Vote-for-Pearson' button." He said, "Forget it, lady, my shop is closed," and asked her to leave. She said, "OK, I accept your offer of $95." He made no response. If she sues for breach of contract, which of the following is true?

When a person has agreed to paint a house and, before the job is finished and payment is due, the other party refuses to allow completion, the court will use the quantum meruit principle to require the breaching party to pay a reasonable price for the benefit he has received.

Sylvia had contracted with Produce Palace to sell her entire crop of elephant garlic (100 kilograms) and her entire crop of tomatoes (100 kilograms). On the day for delivery, Produce Palace took the garlic but not the tomatoes. In her effort to mitigate her loss, Sylvia called the owner of Val's Veggies and offered her the tomatoes at a reduced price with the words, "Let me know quickly, because they are ripe and must be moved out today." That afternoon, Val sent Sylvia a letter accepting the offer. On these facts, which is the most likely outcome?