What the subject covers
Contract is examined in FLK1 Session 2, with Tort and the Legal System. The specification is the classic syllabus — formation, terms, vitiating factors, discharge and remedies — asked in a commercial setting and answered in a single best answer.
Formation
Offer and acceptance, including the treatment of invitations to treat, counter-offers, revocation and the rules on communication; certainty and completeness; consideration and the limits of promises to accept less; intention to create legal relations; and capacity. Promissory estoppel sits alongside as a shield rather than a cause of action.
Exam shape: a negotiation with a sequence of communications and a date, asking whether a contract exists and on whose terms. The battle of the forms is a favourite.
Terms and their control
- Incorporation by signature, by notice or by a course of dealing, and the timing that defeats it.
- Classification as a condition, a warranty or an innominate term, and what each allows the innocent party to do.
- Implied terms by statute, by custom, and to give business efficacy.
- Exclusion and limitation clauses: incorporation, construction against the party relying on them, and the statutory controls — reasonableness between businesses, and the fairness regime where a consumer is involved.
When something is wrong with the agreement
Misrepresentation — the types, the remedies available for each, and the bars to rescission; mistake, common and unilateral; duress, including economic duress; and undue influence, with the special position of a lender taking security from someone influenced by another. Illegality appears in outline.
Misrepresentation is examined more than the rest combined, because the options can offer the right facts with the wrong remedy.
Discharge and breach
Discharge by performance and the exceptions to the entire obligations rule, by agreement, by frustration — with its limits and the statutory adjustment of losses — and by breach, including repudiatory breach and anticipatory breach and the electing party’s options.
Remedies
- Damages: the expectation and reliance measures, causation and remoteness, mitigation, contributory conduct and the treatment of non-pecuniary loss.
- Agreed sums: the line between an enforceable liquidated damages clause and a penalty.
- Equitable remedies: specific performance and injunctions, and why damages are usually the answer.
- Restitution where the contract has not produced an enforceable obligation.
- Third parties: privity and the statutory rights of a third party to enforce a term.
Where the marks go
- Remedy, not liability. Most candidates identify the breach and then pick a remedy the facts do not support. Rescission after affirmation is the classic.
- Term classification. Whether the innocent party may terminate turns on it, and the options all offer plausible consequences.
- Consumer or business. The same clause, two regimes.
- Remoteness. Loss that follows from the breach but is not recoverable is the difference between the best answer and the second best.
It pairs naturally with Tort, which shares the session and much of the analysis of loss; the whole paper is mapped in the FLK1 subject guide.