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Contract Law Landmark Cases

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Set the precedent for the objective theory of contract formation.

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Case name: Smith v Hughes (1871). Impact: This case emphasized the importance of the parties' outward expressions over their secret intentions in forming a contract.

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Demonstrated the importance of intention to create legal relations as a criterion for contract formation.

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Case name: Balfour v Balfour (1919). Impact: This case differentiated between social and domestic agreements and those intended to be legally binding.

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Highlighted the doctrine of promissory estoppel.

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Case name: Central London Property Trust Ltd v High Trees House Ltd (1947). Impact: This case established a precedent for enforceable promises made without consideration, under certain conditions.

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Established that a contract requires an offer, an acceptance, and a consideration.

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Case name: Carlill v Carbolic Smoke Ball Co. (1893). Impact: This case laid the foundation for the basic elements of a contract.

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Explored the limits of fraudulent misrepresentation in a contract.

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Case name: Derry v Peek (1889). Impact: This case helped establish the tort of deceit and the requirements for a claim of fraudulent misrepresentation in contract law.

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Cutting case law on the enforceability of penalty clauses.

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Case name: Dunlop Pneumatic Tyre Co Ltd v New Garage & Motor Co Ltd (1915). Impact: This established the difference between a genuine pre-estimate of damages (liquidated damages) and a penalty.

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Illustrated the effect of a mistake on the validity of a contract.

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Case name: Bell v Lever Brothers Ltd (1932). Impact: This case showed that a common mistake can render a contract void if it goes to the root of the agreement.

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Clarified the terms for implied-in-fact contracts through conduct.

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Case name: Brogden v Metropolitan Railway Company (1877). Impact: The case held that a contract can exist based on the conduct of the parties, defining implied contracts.

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Clarified 'invitation to treat' versus an offer.

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Case name: Partridge v Crittenden (1968). Impact: This case established that advertisements are generally considered invitations to treat, not offers, which affects how contracts are formed.

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Set the standard for implied terms in contract law.

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Case name: The Moorcock (1889). Impact: This case established the 'business efficacy test', which implies certain terms into contractual agreements to make them workable.

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Dealt with the issue of consideration past the formation of a contract.

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Case name: Stilk v Myrick (1809). Impact: This case set a precedent that a promise to perform an existing duty is not good consideration for a new promise.

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Addressed the proper method of acceptance in contractual agreements.

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Case name: Entores Ltd v Miles Far East Corporation (1955). Impact: It established that acceptance is only effective when communicated to the offeror, particularly in the context of telex communications.

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Elucidated the principles of frustration in contract law.

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Case name: Taylor v Caldwell (1863). Impact: This case established the doctrine of frustration, excusing parties from performance due to unforeseen events that render the contract impossible or radically different.

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Focused on the issue of exclusion clauses in contracts.

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Case name: L'Estrange v F. Graucob Ltd (1934). Impact: This case held that a signed contract is binding even if a party has not read the terms, including exclusion clauses.

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Established the impact of a unilateral mistake on contract enforcement.

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Case name: Cundy v Lindsay (1878). Impact: The case determined that a contract is void if one party is mistaken about the identity of the other party and the identity is crucial to the contract.

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Defined the limits of acceptable behavior in negotiations.

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Case name: Walford v Miles (1992). Impact: Established that an agreement to negotiate in good faith is not a binding contract due to the lack of intention to create legal relations.

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Set a precedent on the enforcement of restrictive covenants in employment.

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Case name: Nordenfelt v Maxim Nordenfelt Guns and Ammunition Co Ltd (1894). Impact: It held that restrictive covenants in employment contracts are enforceable provided they are reasonable and protect legitimate business interests.

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Expounded on unfair terms in consumer contracts.

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Case name: George Mitchell (Chesterhall) Ltd v Finney Lock Seeds Ltd (1983). Impact: The case formed part of the development of the Unfair Contract Terms Act 1977, focusing on the reasonableness test for excluding liability.

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Highlighted limitations on the variation of contract terms.

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Case name: Pinnel's Case (1602). Impact: It established a rule that payment of a lesser sum on the day cannot be satisfaction for the whole, except under specific conditions, forming the basis for the rule in Foakes v Beer.

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Changed the legal understanding of misrepresentation and silence as a means to induce a contract.

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Case name: Keates v Lord Cadogan (1851). Impact: The case created a distinction within contract law on when silence or non-disclosure can amount to misrepresentation.

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Clarified the test for whether a term is a warranty or a condition.

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Case name: Poussard v Spiers (1876). Impact: Established that breaching a condition entitles the innocent party to terminate the contract, while breaching a warranty entitles them to damages only.

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Highlighted the significance of terms through representation in contract formation.

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Case name: Bisset v Wilkinson (1927). Impact: This clarified that statements made during negotiations are not necessarily contract terms unless they are explicitly confirmed as such.

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Examined the requirement of contractual consideration within the context of payment complications.

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Case name: Foakes v Beer (1884). Impact: This case reaffirmed the rule that a promise to accept a lesser sum in discharge of a greater sum, if unaccompanied by any new consideration, is not binding.

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Set forth the principle of effective communication of revocation of offers.

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Case name: Byrne & Co v Leon Van Tien Hoven & Co (1880). Impact: This case concluded that a revocation of an offer is not effective until it is communicated to the offeree.

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Focused on the importance of mutual consent for a valid contract.

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Case name: Raffles v Wichelhaus (1864). Impact: This case introduced the concept of mutual mistake, where a contract can be void if both parties are under a mistaken understanding of a basic assumption of fact.

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