Legal remedies for breach of contract - LAW 108A - Midterm.docx · Web viewNotes CB 200 Not always...

CONTRACTS FALL 2012 PROFESSOR MARY ANNE WALDRON, Q.C.

Table of ContentsLegal remedies for breach of contract..................................................................................................................................4

Damages............................................................................................................................................................................4

Wertheim v. Chicoutimi Pulp CB 27...............................................................................................................................4

Hawkins v. McGee CB 36 “I promise a 100% good hand!”............................................................................................4

What issues might complicate damage awards?...............................................................................................................4

Damages in Contract v. Damages in Tort.......................................................................................................................4

Specific Performance.........................................................................................................................................................5

Falcke v. Gray CB 121 “I want those ugly china vases you promised me!”....................................................................5

Warner Bros. v. Nelson CB 135 “Betty Davis doesn’t want to act for you anymore!”...................................................5

Offer......................................................................................................................................................................................6

What Is An Offer?..............................................................................................................................................................6

Denton v. Great Northern Railway CB 174 “You advertised a train, there is NO train!”...............................................6

Johnston Bros v. Rogers CB 177 “You could buy some flour from us”...........................................................................6

Lefkowitz v. Great Minneapolis Surplus Store CB 181 “Fur coats are only for ladies”...................................................6

Pharmaceutical Society v. Boots CB 183 “Do you have to keep medicine behind a counter?”.....................................6

Dickinson v. Dodds CB 192 “Rumor has it, you’re going to sell that land to Allan now!”..............................................7

Acceptance............................................................................................................................................................................8

How Acceptance Happens.................................................................................................................................................8

Manchester Diocesan Council CB 189 “Judge is frustrated with the assumption of time limits”..................................8

Larkin v. Gardiner CB 191 “But I told my agent! That should count, right?”.................................................................8

Eliason v. Henshaw CB 199 “Sent acceptance for flour to wrong place via wrong mode”............................................8

Acceptance or Counter-Offer?..........................................................................................................................................8

Notes CB 200.................................................................................................................................................................8

Butler Machine Tool Co. V. Ex-Cell-O Corp. CB 201 “Battle of Forms”..........................................................................8

Tenders.............................................................................................................................................................................9

Tendering Process.........................................................................................................................................................9

MJB Enterprises v. Defence Construction CB 209 “but they didn’t give you a fixed price!”..........................................9

Formalization and Certainty................................................................................................................................................10

Cassidy Thomson Fall 2012

Filling in the Gaps............................................................................................................................................................10

May and Butcher Limited v. The King CB 219 “You can buy this tentage”...................................................................10

Hillas v. Arcos CB 222 “Buying some Russian Trees”...................................................................................................10

Foley v. Classique Coaches CB 223 “I’ll sell you this land if you buy your gas from me”.............................................10

Empress Towers v. Bank of Nova Scotia CB 230 “I want $15,000” or you are kicked out!”.........................................11

Correspondence..................................................................................................................................................................12

Acceptance......................................................................................................................................................................12

Henthorn v. Fraser CB 240 “Mailed acceptance before received withdrawal”...........................................................12

Withdrawal of Offer........................................................................................................................................................12

Byrne v. Leon Van Tienhoven CB 242 “doing business overseas before telephones… ugh”........................................12

Note from Pollock and Restatement excerpt CB 244..................................................................................................12

Exceptions.......................................................................................................................................................................12

Howell Securities v. Hughes CB 244 “the letter that never arrived”............................................................................12

Electronic Communication..............................................................................................................................................13

Eastern Power v. Azienda CB 248................................................................................................................................13

Electronic Commerce Act CB 251................................................................................................................................13

Consideration......................................................................................................................................................................14

Consideration Provides:..............................................................................................................................................14

Gifts.............................................................................................................................................................................14

Contract of Agency......................................................................................................................................................14

Rescission:...................................................................................................................................................................14

What is consideration?....................................................................................................................................................15

White v. Bluett CB 255 “You don’t have to pay me back if you shut up, son”.............................................................15

Hamer v. Sidway CB 257 “Nephew, stop those shenanigans and I’ll give you $5000”................................................15

Thomas v. Thomas CB 258 “Oh I forgot to give my wife something in the will…”.......................................................15

Explicit vs. Implicit Consideration....................................................................................................................................15

Tobias v. Dick CB 263 “I have exclusive right to sell your Dick Crusher”......................................................................15

Wood v. Lucy, Lady Duff-Gordon CB 264 “Brand some fashion in my name”.............................................................15

Pre-Existing Legal Duties.................................................................................................................................................16

Harris v. Watson CB 266 “The ship is in danger! Please do this extra work to save it, I’ll pay!”..................................16

Stilk v. Myrick CB 266 “I will give you the deserters wages if you keep working”.......................................................16

New Zealand Shipping.................................................................................................................................................16

Gilbert Steel v. University Construction CB 271 “The price of steel went up! Sure we’ll pay that… not”....................16

Williams v. Roffey CB 274 ENGLAND 1991 “Oops, I didn’t charge enough for this job, now I can’t finish”.................17


Greater Fredericton Airport Authority v. NAV CB 283 “We aren’t paying for your new equipment”.........................17

River Wind Ventures Ltd. v. British Columbia CB 282..................................................................................................17

Money as consideration for Money................................................................................................................................17

Foakes v. Beer CB 283 “Mrs. Beer has legal judgement against Dr. Foakes, but she lets him pay less at first”...........17

Mercantile Law Amendment Act CB 287 (see also, Law and Equity Act, RSBC 1996, c. 253, s. 46).............................17

Legal compromise as Consideration................................................................................................................................18

Fairgrief v. Ellis CB 291 “Come live with me and I’ll give you my house… oh wait, my bitch wife is back”..................18

Pledges and Donations....................................................................................................................................................18

Dalhousie College v. Boutilier Estate CB 292 “But he promised us $5000!”................................................................18

Intention.............................................................................................................................................................................18

Contracts between family relations................................................................................................................................18

Jones v. Padavatton CB 301 “Hey daughter, leave Washington and study for the bar in England, I’ll pay”................18

Contracts between business relations.............................................................................................................................18

Rose v. J.R. Crompton CB 304 “Let’s put this into our K that it isn’t actually a K in any court”...................................18


Legal remedies for breach of contract

DamagesTwo broad classes

1) minor—timing slightly off or inconviences—remedy is always DAMAGES.

2) Major—cancelling early or broken in a serious way—remedy is usually damages, an unusual remedy is for specific performance of the contract to be order, very rarely recission is ordered which means to put the parties back in original positions if the K never existed.

Wertheim v. Chicoutimi Pulp CB 27 Issue Ratio NotesHow to determine the amount of damages to award?

The plaintiff should be compensated so that they are in the same position as if the contract had been performed

Hawkins v. McGee CB 36 “I promise a 100% good hand!”Issue Ratio NotesHow to determine the amount of Damages

The plaintiff should be compensated so that they are in the same position as if the contract had been performed

Losses incurred because of the breach of K not considered: i.e. pain and suffering b/c of hurt hand—JUST put them in the position had the K been performed, not extra damages

What issues might complicate damage awards?Limiting Factors: Plaintiff needs to attempt to mitigate their loses if it is possible to do so. Remoteness: things not reasonably anticipated ex. The loss of a kingdom b/c the shoe fell off a horse is not a ‘fair’ circumstance in which to attribute damages to the horse shoe contract breaker.

Intangible Damages: Normally psychological pain and suffering not considered, UNLESS the K has an element of psychological benefit to it, then you might be able to recover for emotional distress.

Punitive Damages: If there is no economic loss, or in addition to damages for economic loss, rarely the court will place punitive damages to punish the K breaker

Damages in Contract v. Damages in TortDamages in Contract are all about remedying economic loss. Torts will give out remedies for pain and suffering, but not contract damages


Specific PerformanceOriginates in the court of equity and was historically reserved for transactions involving land. In order to sue for specific performance you have to be able to show that money can’t reasonably compensate you. Discretionary remedy, which means the plaintiff MUST 1) act promptly 2) Not be guilty of sharp practices or bad dealing

Falcke v. Gray CB 121 “I want those ugly china vases you promised me!”Issue Ratio NotesCan specific performance be sought for the sale of chattels, rather than the historic real-property?

If an article in a K is of unique character the court can order SP to enforce the K to sell it.

Must be impossible to find elsewhere-Court will not prejudice innocent 3rd parties (i.e. if already sold to someone else=No SP)-SP not ordered in this case b/c already sold to 3rd party

Warner Bros. v. Nelson CB 135 “Betty Davis doesn’t want to act for you anymore!”Issue Ratio NotesCan the court enforce specific performance for personal service (i.e. make you do a thing you said you would do in a K)

The court will not enforce a positive covenant for personal service b/c it is tantamount to indentured servitude, it is too difficult to enforce, and is too detailed requiring too much supervision.

Negative covenants can be enforced

Negative covenants cannot be enforced if doing so leaves the individual with nothing else to do but starve or perform the personal service.


OfferOffer: What constitutes an offer? An important factor to consider is how the ptf relied upon the disputed offer. Would a reasonable person assume that this was de facto an offer? An offer must contain all the terms necessary for the contract to be performed. Certain terms can be implied if there is a usual industry standard for something like quantity etc. An offer can be withdrawn or changed any time prior to acceptance but this must be communicated to the other party.

What Is An Offer?

Denton v. Great Northern Railway CB 174 “You advertised a train, there is NO train!”Issue Ratio NotesDoes a train timetable constitute a contract?

A train time table constitutes an offer which is accepted when a person arrives to take the train.

-The degree of certainty by Ptf important, how much they relied upon the “offer”-Policy issue: wanted railways to be responsible to the public

Johnston Bros v. Rogers CB 177 “You could buy some flour from us”Issue Ratio NotesIs a price quote an offer or an invitation to treat? What is the difference btwn an offer and an invitation to treat?

A price quote is merely an invitation to treat because there are still many details of the K to determine, such as quantity and timing.

The amount of reliance placed on a disputed ‘offer’ is important: what would the reasonable expectation be. Also the wording of the disputed “offer”—is it clear that it is invitation to treat by wording?

Lefkowitz v. Great Minneapolis Surplus Store CB 181 “Fur coats are only for ladies”Issue Ratio NotesWhat is an offer versus an invitation to treat?Specific: Can an advertisement be an offer?

An offer must contain all the terms necessary for the contract to be performed to be considered an offer. If it doesn’t, then it is just an invitation to treat

-Anytime prior to acceptance the offer can be changed or withdrawn- Unusual situation in which court held ad was offer- b/c it was so specific.-Legislation provides consumer protection for ads now.

Pharmaceutical Society v. Boots CB 183 “Do you have to keep medicine behind a counter?”Issue Ratio NotesWhen does the contract of sale in a self-serve store take place? I.e. what is the offer?

Displaying items on a shelf is merely an invitation to treat. The offer occurs when the customer takes the item to the till for purchase and acceptance is the cashier/clerk ringing the item through the till and taking the $.

Illustrates that the courts care about the consequences of declaring something a contract. They look at the practicalities that result from declaring something an offer.


Dickinson v. Dodds CB 192 “Rumor has it, you’re going to sell that land to Allan now!”Issue Ratio NotesCan an offer be withdrawn? A firm offer is not enforceable,

until acceptance the offeror is as free as the offeree to change their mind and withdraw or alter the offer.The offeror must communicate a change in the offer or a withdrawal to the offeree

- You can enforce a firm offer it is placed under seal (from the old writ of covenant)


Acceptance

How Acceptance Happens

Manchester Diocesan Council CB 189 “Judge is frustrated with the assumption of time limits”Issue Ratio NotesWhy does the law impose time limits on acceptance when not imposed in the offer?

If acceptance exceeds a reasonable amount of time the K is not valid b/c a)the offer is considered withdrawn or b) the offer is seen as refused

The judge preferred option b b/c that seemed more easy to determine objectively and be fair to both parties

Larkin v. Gardiner CB 191 “But I told my agent! That should count, right?”Issue Ratio NotesWhat constitutes acceptance? ORDoes acceptance need to be communicated to the offeror?

When the power of acceptance is given to a person, that person has a duty to communicate their acceptance to the offeror. Until communication happens, no acceptance is made.

Eliason v. Henshaw CB 199 “Sent acceptance for flour to wrong place via wrong mode”Issue Ratio NotesHow Can the offeree accept? It is in the power of the offeror

to dictate the terms of acceptance, if they are not met there is no K

-Term of acceptance can’t be SILENCE. But, offeree can do an action to show they accept despite the faulty terms, there can still be a K.-Statute: unsolicited goods can be used or kept. They can’t make you pay.

Acceptance or Counter-Offer?

Notes CB 200 Not always easy to tell if counter-offer has been made b/c the terms might not be significantly different. If they

aren’t different, the 1st offer dictates the terms—“material difference” required to be called counter-offer

Butler Machine Tool Co. V. Ex-Cell-O Corp. CB 201 “Battle of Forms”Issue Ratio NotesWhat is a counter offer and what is merely attempting to add conditions?Can you have a clause that says counter offers don’t count?

A counter-offer is essentially a rejection of the original offer, so must have a significant difference between it and offer.Valid counter offer contains the NEW terms that the agreement is bound by and original offer

Use classical analysis of offer and acceptance to determine what the K is. K is bound by terms of offer. Can’t just do what the court thinks the party’s meant.


terms are thrown out.

TendersUCC and notes CB 204

Tendering Process Can’t be subject to normal rules of offer and acceptance, b/c offerors who are calling for tenders need the

bidders to keep their acceptance on the table and take contract if chosen To remedy problem Courts construct a K out of the call for tenders (becomes offer) and the bids(becomes

acceptance) The bidders agree to keep bids on table and to accept K if awarded The consideration given in exchange by the offeror is to promise to treat all bids fairly. This contract is reffered to as contract A, while the contract that is awarded for the actual project (i.e. building a

school) is referred to as contract B This leads many people to sue for breach of K A when they are not awarded K B Leads to more expenses which could be lessened by legislation but there isn’t any

MJB Enterprises v. Defence Construction CB 209 “but they didn’t give you a fixed price!”Issue Ratio NotesCan a call for tenders choose a non-compliant bid to award K B to?

A privilege clause cannot extend to cover non-compliant bids b/c this is a breach of K A—isn’t treating bids fairly to choose a non-compliant oneThe only way to have a firm offer is to construct a contract out of the offer and agreement to negotiate itself

You could negate terms of K A in order to choose a non-compliant bid if you stated that intention from the outset, but then no K A would be formed at all b/c there would be no consideration and bidders wouldn’t have to leave bids on table.


Formalization and Certainty Many details including price need to be determined for a K to be formed Few K can cover all the details, many are verbal etc. Bad public policy to declare all K with any amount of uncertainty void b/c then there would never be any Ks. Courts have a whole range of tools to attempt to fill in gaps of Ks if it appears parties meant to enter into a K. It is difficult to determine where to draw the line btwn being able to fill in gaps and the court simply writing a K

which they will not do. The line btwn enforceability and void for uncertainty is tricky

Filling in the Gaps

May and Butcher Limited v. The King CB 219 “You can buy this tentage”Issue Ratio NotesIs an agreement to agree a contract? NO

The court will not create a K between the parties. Must be enough material to work with in the original K in order for the court to “fill gaps”

-Couldn’t rely on arbitration clause b/c K didn’t give the arbitrator the power to decide the price, just was a method of resolving a disagreement-B/c disagreement couldn’t be resolved, impossible to have a K b/c only way price could be decided was by agreement

Hillas v. Arcos CB 222 “Buying some Russian Trees”Issue Ratio NotesIs an agreement to agree a contract? YES

Ongoing relationships/contracts require a certain amount of flexibility for them to work, therefore a court should use tools such as examining history of past details or industry standards to fills in gaps when a disagreement about an uncertain detail arises

-Court wanted to limit the rule from May and Butcher.-Distinguished b/c parties had operated with the uncertain contract for 1 year before disagreement occurred.

Foley v. Classique Coaches CB 223 “I’ll sell you this land if you buy your gas from me”Issue Ratio NotesIs an agreement to agree a contract? YES

The courts may use past practices to ‘fill gaps’ in contracts to make them work rather than voiding them.

-Distinguished from May and Butcher b/c parties had operated K for 3 years w no problem, which means party couldn’t legit believe there was no K-Also this K was a condition of a larger K to sell some land, so couldn’t just void this K w/o voiding the larger K


Empress Towers v. Bank of Nova Scotia CB 230 “I want $15,000” or you are kicked out!”Issue Ratio NotesWhere is the line between gap filling and no contract for lack of detail?

Courts may imply terms into a K to resolve internal inconsistanccy OR to make the K work

2 Tests for when courts will imply terms1) Efficious Bystander- what would an objective third party say about the intention of the K2) Business Efficacy- Did parties act as if legal relationship was intended-imply terms to make legal relationship work


Correspondence

Acceptance

Henthorn v. Fraser CB 240 “Mailed acceptance before received withdrawal”Issue Ratio NotesIs acceptance complete when it is posted or when it is received?

Acceptance is complete as soon as it is posted if both parties would reasonably expect the mail to be used to give acceptance

-b/c risk of acceptance by mail is born by offeror, b/c they have power to set terms of acceptance and could say no mail if they wanted.-Reasonably expect mail to be used: live far away, no other options, offer sent by mail etc.

Withdrawal of Offer

Byrne v. Leon Van Tienhoven CB 242 “doing business overseas before telephones… ugh”Issue Ratio NotesIs withdrawal of an offer official when it has been posted, or when it has been received?

Withdrawal of an offer by mail is not considered withdrawn until the offeree receives it

Note from Pollock and Restatement excerpt CB 244 Can only consider offer revoked if it is communicated to other party Unfair otherwise b/c offeree may act on the basis that they have a K

Exceptions

Howell Securities v. Hughes CB 244 “the letter that never arrived” An “option K” is when an offer is open for a fixed period of time. Because this is a great benefit to the person

who has power of acceptance, the courts interpret option clauses very strictly.

Issue Ratio NotesIs there still a K if the letter never arrives, b/c it was formed when it was mailed?

Rule of acceptance upon posting does NOT apply if express terms of offer specify acceptance must reach the offeror.

This is the 2nd qualification for post box rule:

1. Mail must be mode2. Can’t if terms indicate

otherwise


Electronic Communication

Eastern Power v. Azienda CB 248Issue Ratio NotesWho has jurisdiction? Was the K formed where acceptance received or where sent?

Normally where acceptance is received is the jurisdiction of the K. However, this is opposite for letters that are mailed, where it is where the acceptance is sent.

Should acceptance by fax fall under the post box rule?

The post box rule is not applied to instantaneous forms of communication.

Electronic Commerce Act CB 251 Received when capable of being retrieved (if addressee uses that system for that type of communication, if

they DON’T then it’s when the addressee becomes aware of it) Acceptance It’s ok to click on an icon to accept Errors with online agents Escape clause if there is a mistake with an automated agent Sent considered ‘sent’ when it leaves your system Further clarification of location of things sent/received.


Consideration Legal requirement of a K Something given in exchange Promisor = person doing the thing you want to enforce Promisee= recipient of the thing you want to enforce Consideration must move from the promisee to the promisor Wholly executory K there are just promises given in consideration, no one has acted Executed K when something has been carried out in consideration (whole or part) Promise for a promise counts as consideration, although this is theoretically tricky. For policy reasons that we

want people to be able to rely on those promises. Generally: consideration is a detriment to the promisee (at the request of the promisor) OR is a benefit to the

promisor.

Consideration Provides:1. Evidence that a K was made2. Evidence that the parties intended a legal relationship3. Distinguishes transaction as a K rather than a gift4. Protects Reliance (even for wholly executory Ks)

**See if the contested consideration fulfills any of these functions to determine if it is consideration***

Gifts A promise to make a gift is NOT enforceable. A gift must actually be transferred, completed, to be consider

giftee the owner of the gift. Court will protect reliance on K’s over reliance on uncompleted gifts.

Contract of Agency Party A contracts party B to do something: i.e. sell property or sign contracts on their behalf Party A implicitly receives consideration of party B’s “reasonable efforts” Agent doesn’t buy the property, if they fail to sell it is still party As.

Rescission: Both parties promise to release the other from the original K (therefore adequate consideration from both—

promise for a promise) which essentially creates a new K ending the original K.


What is consideration?

White v. Bluett CB 255 “You don’t have to pay me back if you shut up, son”Issue Ratio NotesIs a promise “not to complain” consideration?

‘giving up’ something for consideration is only valid if the promisee has the legal right to do that thing.

Also policy: don’t want to say you can annoy someone until they agree to pay you $ for you to stop. Hard to prove if son kept his bargain anyway.Son doesn’t have legal right to complain b/c father not legally required to treat all his children the same.

Hamer v. Sidway CB 257 “Nephew, stop those shenanigans and I’ll give you $5000”Issue Ratio NotesIs a promise to “not smoke, drink, play cards, swear until 21” consideration?

A promise to refrain from doing something that you have legal right to do is good consideration. Detriment to Nephew AT REQUEST of the Uncle

distinguished from white b/c very specific transfer requirements, witnesses, evidence in writing

Thomas v. Thomas CB 258 “Oh I forgot to give my wife something in the will…”Issue Ratio NotesConsideration, or burdens incidental to a gift?

Ex. someone gives you a horse and you have to feed it, feeding it is incident to the gift.

Consideration must flow from promisee to promisor and be something more or different than they would necessarily have to do if the item was a gift.

Here the £1 rent was paid to the executor not the landlord, therefore wasn’t just an incident of a gift of the house but rather was consideration.

Explicit vs. Implicit Consideration

Tobias v. Dick CB 263 “I have exclusive right to sell your Dick Crusher”Issue Ratio NotesIs a contract of exclusive right to sell void for lack of consideration?

If the K does not specify amounts or quotas of sale there is no K b/c there is no consideration. Instead it should be seen as an “umbrella offer” and acceptance creates a mini contract each time the one person buys the product from the other.

Not an Agency K because Tobias was buying the product from Dick, therefore not acting as his agent and couldn’t find implicit consideration that Tobias would “do his best” to sell.

Wood v. Lucy, Lady Duff-Gordon CB 264 “Brand some fashion in my name”Issue Ratio NotesCan consideration be implicit in a contract of exclusive right to sell?

Consideration can be implicitly understood as “reasonable effort” if the K is an agency K.

Different than Tobias b/c Wood wasn’t buying, he was providing detailed accounts, K was quite detailedlooks like joint enterprise


Pre-Existing Legal Duties

Harris v. Watson CB 266 “The ship is in danger! Please do this extra work to save it, I’ll pay!”Issue Ratio NotesIs a variation of consideration enforceable because continuing to do your contractual obligations adequate consideration?

Extra consideration offered for what the party already had a pre-existing duty to do is not enforceable.

Policy decisiondidn’t want to fuck with sea faring business in England

Stilk v. Myrick CB 266 “I will give you the deserters wages if you keep working”Issue Ratio NotesIs continuing to do your contractual obligations adequate consideration in return for a variation of original K?

It is not adequate consideration to continue to do your pre-existing legal obligations. Consideration must be something new, something that isn’t already required.

Decision based on:Doctrine of Consideration

New Zealand ShippingIssue Ratio NotesCan a pre-existing duty to party A be valid consideration to party C?

It is valid consideration to promise to do a pre-existing legal duty from one K to a 3rd party, because the 3rd party receives the consideration of a right of direct cause to enforce the K that otherwise they wouldn’t be able to.

Exception to Pre-existing duty rule

Gilbert Steel v. University Construction CB 271 “The price of steel went up! Sure we’ll pay that… not”Issue Ratio NotesAre contractual variations, which are practical, enforceable?

Contractual variations fail for want of consideration. Consideration cannot be vague or merely an incident of the variation (i.e. natural consequence). The only way to change the consideration of one party, is to mutually rescind the original K and make a new K with the new (i.e. price)

Policy problem for doing business, people don’t check with their lawyers every time they need to change something in a K.


Williams v. Roffey CB 274 ENGLAND 1991 “Oops, I didn’t charge enough for this job, now I can’t finish”Issue Ratio NotesCan the rule of pre-existing duties be relaxed in some circumstances?

Yes if ALL these conditions are met:1. Pre-existing K for A to do or supply

something for B2. B has significant doubt that A will

or will be able to complete K3. B offers A more $ (consideration)

to complete on time *Without any economic duress

4. B receives the practical benefit of having K done on time, even if this does not come directly from B.

Then performing the pre-exisiting duty can be good consideration.

Still developing area, yet to be seen if this will be applied in Canada or perhaps in altered version.

Greater Fredericton Airport Authority v. NAV CB 283 “We aren’t paying for your new equipment”Issue Ratio NotesEnforceability of contract variation. Does it apply the Williams v. Roffey test?

“post-contractual modification, unsupported by consideration my be enforce able so as it” (is made in a serious way with intention for legally enforceable promise) “is established that the variation was not procured under economic duress”

-However misses the part from William v. Roffey which requires a “practical benefit” so doesn’t really apply it correctly even though it purports to.

River Wind Ventures Ltd. v. British Columbia CB 282Issue Ratio NotesDid greater fredricton airport apply the Williams v. Roffey test?

No, it was missing the “practical benefit”. This is required for contract variation with no consideration

Money as consideration for Money

Foakes v. Beer CB 283 “Mrs. Beer has legal judgement against Dr. Foakes, but she lets him pay less at first”Issue Ratio NotesIf a debtor makes a promise to receive a lesser payment than they are legally owed, is this promise enforceable? Where is the consideration?

Payment of a lesser sum cannot be satisfaction for a greater

-Because if I give you 10$ for 20$ what is actually happening is you are giving me a gift of $10.

Mercantile Law Amendment Act CB 287 (see also, Law and Equity Act, RSBC 1996, c. 253, s. 46) English law in response to Foakes v. Beer but have similar law in BC If creditor says part repayment in a certain way is ok, then doing so extinguishes the whole debt However if promise is made and not yet acted upon it is not enforceable


Legal compromise as Consideration

Fairgrief v. Ellis CB 291 “Come live with me and I’ll give you my house… oh wait, my bitch wife is back”Issue Ratio NotesIs giving up a right to legal action, which doesn’t actually exist, consideration?

If you have genuine belief that you have a legal claim, it is good consideration to promise to give it up.

No legal claim here b/c contract for sale of land was not in writing—old statute of frauds rule.

Pledges and Donations

Dalhousie College v. Boutilier Estate CB 292 “But he promised us $5000!”Issue Ratio NotesIs a pledge to donate an enforceable K? Where is the consideration?

Pledges are gifts and not contracts for lack of consideration on the part of the charity

UNLESS project embarked upon with the donation is at the request of the donator or subject to their conditions (like naming the building after them)

Intention

Contracts between family relationsPresume that agreements between family are not legally binding contracts

Jones v. Padavatton CB 301 “Hey daughter, leave Washington and study for the bar in England, I’ll pay”Issue Ratio NotesCan the presumption against family relation agreements being legally binding be rebutted?

Yes, if intention to the contrary is shown given all the circumstances

Factors: specificity, significan detriment in reliance, evidence in writing, degree of flexibility

Contracts between business relationsPresume that agreements between business relations are meant to be legally binding

Rose v. J.R. Crompton CB 304 “Let’s put this into our K that it isn’t actually a K in any court”Issue Ratio NotesCan the presumption that business agreements are legally binding be rebutted?

Yes, if express intention is written into the agreement to the contrary.

Rare, but particularly used in inter-institutional agreements (i.e. universities)


Legal remedies for breach of contract - LAW 108A - Midterm.docx · Web viewNotes CB 200 Not always...

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Transcript of Legal remedies for breach of contract - LAW 108A - Midterm.docx · Web viewNotes CB 200 Not always...