Contract Law

A detailed Summary of Contract Law

If one party has been induced to enter into a contract by a factual statement which turns out to be untrue he will have a remedy even though the statement has not become a term of the contract. If a statement is a term and turns out to be untrue there is a breach of the contract. It is obvious and that Isabella's statement was false however the courts need to differentiate as to whether this was Isabella's stating of fact or her opinion but we are told that "Isabella knew this was not true". The representation must be made to a party in the contract. In Peek V Gurney (1873) P had bought shares form a third party, relying on the statements made in the prospectus issued when the company sold shares. It was held he could not rely on the statements, which turned out to be untrue, because the prospectus was addressed only to the original purchasers of shares sold to the company. Misrepresentation may be fraudulent , negligent or innocent. A fraudulent reprsentation is a false statement made: a)knowingly b) without belief in its truth, or c) recklessly, careless whether it be true or false. In this case Isabella is guilty of a) & b). The plaintiff may claim recession and damages if he/she has entered into a contract. The d

The major remedy through the courts is damages. The object of damages in contract is to put the inured party in the position he or she would have been in if the contract had been properly performed. AS the measure is the plaintiffs loss, rather than the defendant's gain, it will be irrelevant that the defendant has gained overall by being in the breach of contract. The purpose of common law damages is to compensate the victim for loss. However the remedy of contract will depend on the nature of the breach: a) breach of condition - whole contract is terminated and damages are awarded, b) breach of warranty - contract continues but damages can be claimed or c) in nominate where the courts determine whether breach is sufficient to determine the contract (Hong Kong Fir Shipping v KKK). Damages are also awarded for loss incurred in reliance on the contract. In Anglia Television v Reed (1972) R, an actor, broke his contract to star in a television play, It was held that A could recover the cost already incurred in reliance on R's performing his contract. Also damages are recoverable for a loss which is foreseeable: the basic rule comes from Hadley v Baxendale (1854). P was a miller in Gloucester, the drive shaft of the mill being broken, P contracted with a carrier to take it to the makers at Greenwich so that they could use it for a pattern in making a new one. D delayed delivery of the shaft beyond a reasonable time, so that

Some common words found in the essay are:
Misrepresentation Act, Peek Gurney, Lord Denning, Hadley Baxendale, Contract Law, Television Reed, KKK Damages, breach contract, contract statement, third party, damages awarded, statement term, incurred reliance, party contract, position contract, innocent party, loss foreseeable,

Approximate Word count = 1035
Approximate Pages = 4 (250 words per page double spaced)

Category: Miscellaneous