Contract law assessment 1_
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Victoria University *
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Apr 3, 2024
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Contract law assessment 1:
Assessment Questions:
Student Name
Student ID
Ensure to use footnotes, bibliography and cases to support your answers.
1.
Research and provide a legal definition of what is a contract including its main
elements?
Enter response here:
2.
Jack gives Jill $10.00 to put in for a $20.00 lotto ticket. Jill puts in the other
$10.00. On this occasion Jill buys the ticket using the numbers of their wedding
day and she is very lucky and wins $20 Million dollars. She now files for divorce
and does not want to give any of the lotto winnings to Jack as he did not buy her
the diamond ring. Can Jack sue for breach of contract? Discuss
Enter response here:
3.
Balfour v Balfour [1919] 2 KB 571
is quite an important case in this area of law.
Please locate it and give a brief summary of its importance.
Enter response here:
4.
Big Company Pty Ltd is a landlord for a building in the city. Little Company Pty
Ltd inspects the premises for rent, orders furniture, and changes its address and
advises customers of new location and pays the first month of bond and rent.
Big Company Pty Ltd then receives a higher rent offer from Sneaky Company Pty
Ltd. Big Company Pty Ltd wants to pull out of its deal with Little Company Pty
Ltd by refunding the bond and rent as the formal lease agreement has not been
signed. Discuss how Little Company Pty Ltd can seek relief. You must refer to
the case of
Walton Stores v Maher
.
Enter response here:
5.
You park your car at the City Car Park. Prior to entry, on your ticket and signs all
around say “Vehicles left overnight are not our responsibility if damage occurs”.
You party hard at the City Casino and take the train home. The next day you
notice when you left your car overnight a window has been smashed. What is the
principle that the Car Park is relying on to say they are not responsible for your
broken window?
Enter response here:
6.
You are about to buy a car from a car dealer. They email stating that the car will
be delivered will a full tank of gas. The car is delivered to your home. You notice
that it is only filled to below a quarter tank. You call the car company, but the
dealer laughs and says that the Sale Note for the vehicle you signed says
nothing about a full tank of gas. Can you rely on the email which was not a part
of the Sale Note?
Enter response here:
7.
What is the difference between a ‘representation’ and a ‘term’ in a contract?
Enter response here:
1.
Research and provide a legal definition of what is a contract including its main
elements?
Answer to question 1
：
The key element of a contract include: (
Stephen Graw,
An Introduction to the Law of
Contract
(Thomson Reuters (Professional) Australia, 2021) 30, 30.
）
1.
The need for a promise or promises
2.
The need for the promise or promises to be between two or more legally capable
persons (called ‘parties to the contract‘.
3.
The need for the promises to create an obligation and
4.
The need for that obligation to be enforceable at law
In essence, a contract is defined by the rights, duties, and liabilities that result from the parties'
promises. The law does not specify a comprehensive list of these elements but provides
guidelines that an agreement must meet to be enforceable. Thus, a rough definition can be
stated:
“an agreement between two or more parties, involving one or more promises that are given for
something in return, and that the parties intend to be legally enforceable.”
2.
Jack gives Jill $10.00 to put in for a $20.00 lotto ticket. Jill puts in the other $10.00. On
this occasion Jill buys the ticket using the numbers of their wedding day and she is
very lucky and wins $20 Million dollars. She now files for divorce and does not want to
give any of the lotto winnings to Jack as he did not buy her the diamond ring. Can Jack
sue for breach of contract? Discuss
Short answer:
Jack possesses a viable basis to sue Jill for breach of contract, as the essential elements of a
contract—offer, acceptance, consideration, and intention to create legal relations—are evident in
their agreement to jointly purchase a lotto ticket and share the winnings. Jill’s defense,
predicated on an unrelated condition, does not negate her obligation to adhere to the terms of
their agreement. Therefore, Jack can likely pursue legal action to claim his share of the lotto
winnings.
Main issue: Can Jack sue for Breach of Contracts ?
The ability to sue for breach of contract hinges on proving the existence of a contract's key
elements: offer, acceptance, consideration, and intention to create legal relations. The contract
must also be clear in terms, and both parties must have the capacity to contract. In disputes
involving informal or domestic agreements, the intention to create legal relations is critically
examined, as there's a general presumption against such intention in domestic arrangements
unless clear evidence suggests otherwise.
Thus, Jack's ability to sue Jill for breach of contract is contingent upon overcoming the
presumption against the intention to create legal relations in domestic arrangements and
demonstrating that their agreement had sufficient clarity and seriousness to constitute a binding
contract. The success of his claim would largely depend on the court's interpretation of their
actions and communications regarding the purchase and intended sharing of the lot
Sub issue: Whether a contract was formed ?
Rule:
Formation of a Contract:
For a contract to be formed, there must be an offer,
acceptance,consideration, and an intention to create legal relations.
●
Offer:
A clear and definite proposal made by one party to the other.
●
Acceptance:
The unconditional agreement to the terms of the offer.
●
Consideration:
Something of value exchanged between the parties.
●
Intention to Create Legal Relations:
Parties must intend for their agreement to be
legally binding.
Principles Regarding Offer and Acceptance:
●
An offer must be communicated and intended to result in a contract if accepted.
●
Acceptance must correspond exactly with the terms of the offer and be communicated to
the offeror.
Application:
Offer:
Jack's act of giving Jill $10.00 to contribute to a $20.00 lotto ticket can be interpreted as
an offer to enter into a joint venture for the purchase of the ticket, with the implied condition of
sharing any potential winnings.
Acceptance:
Jill's action of accepting the $10.00 from Jack and purchasing the lotto ticket,
particularly using the numbers of their wedding day, indicates her acceptance of Jack's offer.
This action aligns with the principle that acceptance must be communicated, though not
necessarily in a specific manner, as long as it is understood by both parties.
Consideration:
The consideration here is mutual; Jack and Jill each contribute $10.00 towards
the purchase of the lotto ticket. This satisfies the requirement that something of value (in this
case, money) is exchanged between the parties.
Intention to Create Legal Relations:
Given the domestic nature of their relationship and the
informal agreement regarding the lotto ticket, this criterion is the most contentious. Generally,
agreements between spouses or partners are not presumed to have the intention to create legal
relations unless clearly stated otherwise. However, the use of their wedding date numbers and
the mutual contribution to the purchase might imply a joint venture with a commercial nature,
potentially overcoming the presumption against legal intent in domestic arrangements.
Conclusion:
Based on the principles of contract law, it is arguable that a contract was formed between Jack
and Jill for the purchase of the lotto ticket and the sharing of any winnings. The elements of
offer, acceptance, and consideration are present. The intention to create legal relations, while
typically difficult to establish in domestic settings, could potentially be inferred from the
circumstances, especially considering the mutual financial contribution and the specific use of
significant personal numbers for the ticket. Therefore, Jack may have a plausible basis to claim
a breach of contract for Jill's refusal to share the lotto winnings, subject to the interpretation of
their intention to create legal relations by a court.
Sub issue: Does Jill have a valid defense ?
Rule:
Intention to Create Legal Relations:
In the context of agreements between spouses or
partners, the presumption is often against the intention to create legal relations, especially in
matters pertaining to the domestic or social sphere. This presumption can be rebutted if clear
evidence indicates that the parties intended their agreement to be legally binding.
Lack of Formality:
Contracts, especially those involving significant sums or important matters,
often require a certain level of formality (e.g., written agreements) to be considered legally
binding. Informal agreements, particularly verbal ones, may lack the requisite formality to be
enforceable, depending on the jurisdiction and the specific circumstances of the case.
Ambiguity in Terms:
If an agreement's terms are ambiguous or not sufficiently definite, it may
be difficult to enforce because the courts cannot ascertain the parties' obligations.
Application:
Intention to Create Legal Relations:
Jill could argue that there was no intention to create legal
relations when they agreed to buy the lotto ticket together. The use of their wedding day
numbers and the mutual contribution towards the ticket purchase might suggest a personal,
domestic arrangement rather than a commercial transaction intended to be legally binding.
Given the presumption against legal intent in domestic arrangements, Jill might contend that
their agreement falls within this category.
Lack of Formality:
Jill could also argue that their agreement was informal, lacking any written
documentation or specific terms regarding the division of any potential winnings. This lack of
formality supports the notion that their agreement was not intended to be legally enforceable but
was a casual, domestic arrangement.
Ambiguity in Terms:
Even if the court were to consider the possibility of a contract, Jill could
argue that the terms of their agreement were too ambiguous to enforce. Without a clear
agreement on how winnings would be divided or any specific actions to be taken upon winning,
it would be challenging for a court to determine what the parties had actually agreed to.
Conclusion:
Jill may have a valid defense against Jack's claim based on the lack of intention to create legal
relations, the informal nature of their agreement, and the ambiguity of the terms regarding the
division of the lotto winnings. These factors collectively weaken the enforceability of their
agreement as a legal contract.
3.
Balfour v Balfour [1919] 2 KB 571
is quite an important case in this area of law. Please
locate it and give a brief summary of its importance.
Case Name:
Balfour v. Balfour [1919] 2 K.B. 571
Issue:
Whether a verbal agreement between a husband and wife,
wherein the husband agrees to provide a monthly allowance for
the wife's maintenance during a temporary separation,
constitutes a legally enforceable contract.
Facts:
The parties, Mr. and Mrs. Balfour, were married in 1900 and lived
together in Ceylon due to Mr. Balfour's employment.
In 1915, they returned to England together, but in 1916, Mr.
Balfour returned to Ceylon, leaving Mrs. Balfour in England on
medical advice.
Before leaving, Mr. Balfour allegedly agreed to provide Mrs.
Balfour with a monthly allowance of £30 for her maintenance.
The relationship deteriorated, leading Mrs. Balfour to sue Mr.
Balfour for the agreed allowance, claiming it was a legally
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