BU231 Lecture Notes - Lecture 1: Kijiji, Headon, Snail Mail
Contract Law – Formation of a Contract
Contract Law
- What is a contract in law?
- Definition of a contract:
o A promise, or set of promises, that the law will enforce
Formation of a Contract
- How do you know when you have a legal contract?
- 7 elements are necessary for the formation of a contract
o Offer
o Acceptance
o Consideration
▪ Consequence if you don’t fulfill your promis
o Intention to Create Legal Relations
o Capacity
o Legality
o Certainty of Terms
Offer
• A tentative promise made by one party, subject to a condition or containing a request to
the other party
• Someone emails you on kijiji saying they’ll pay $5000 for a car by Janary 12 in cash
• Must be definite and certain
• Must be communicated to the intended recipient
• It is intended to be binding on both of the parties as soon as it is accepted
• Most common type of contract: Standard Form Contract (SFC)
• Pre-printed form
• The “Take it or leave it” offer
• No room for negotiation over terms of the contract
Standard Form Contract
• Advantages:
– Highly efficient
– Fast
– Easy
• Disadvantages:
– Inequality of bargaining power
– Little or no room to negotiate terms
• Unusual or unexpected terms:
– Tilden Rent-A-Car Co. v Clendenning (1978), 18 O.R. (2d) 601
• Clendinning wanted to rent a car from Tilden
Document Summary
Definition of a contract: a promise, or set of promises, that the law will enforce. 7 elements are necessary for the formation of a contract: offer, acceptance, consideration, consequence if you don"t fulfill your promis. Intention to create legal relations: capacity, legality, certainty of terms. It is intended to be binding on both of the parties as soon as it is accepted: pre-printed form, the take it or leave it offer, no room for negotiation over terms of the contract. Little or no room to negotiate terms: unusual or unexpected terms: It said in small print: customer agrees not to use the vehicle if they are drunk or consumed any alcohol in any quantity: court said: nobody told him this. If you are changing the terms, you are rejecting. Timing of acceptance: revocation offeror can revoke the offer any time up to acceptance.
