Formation of a contract

• Contract


  A specific type of agreement that is enforceable by both parties in a Court of law
• Breach of contract


  When a party fails to carry out their particular side of the bargain
• To identify a breach of contract, we must first show that the agreement was indeed a contract
• Elements of a valid contract

  • Agreement (Offer and Acceptance)
  • Consideration
  • Intention
• Agreement


  The first and most basic requirement, existing when a valid offer is followed by a valid acceptance
• Offer


  An unconditional statement of a person's intention to be bound by the terms of the offer made and thus the intention to contract with the other person
• Offeror


  The person making the offer
• Offeree


  The person whom the offer is made
• Invitation to treat


  An invitation to a party to make an offer to buy, as distinct from an offer. It is not a binding agreement; it is just an invitation to negotiate.
• Invitations to treat(p.s. this is an example)


  • Goods displayed on shelves in a self-service shop
• Unilateral offer


  An offer that can be accepted through performance rather than acceptance, like a one-sided promise
• Unilateral offer(EXAMPLE)


  • Offering a reward for finding a lost dog
• For a contract to be formed, the offer must be communicated to the offeree
• An offer can be made to one person or to the whole world
• Certainty


  The terms of the offer must be certain, so the offeree knows exactly what they are accepting
• Uncertain terms


  • Promise to pay extra if a horse is 'lucky'
• Where there is uncertainty as to terms and the contract is yet to be performed, the courts generally declare the contract unenforceable