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Contract law revision - Coggle Diagram
Contract law revision
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The objective approach
The court will look at the objective appearance of things, not the actual fact of the agreement
Smith v Hughes (1871)
Blackburn J: a person is bound whatever his real intention may be. If a reasonable man would believe that he was assenting to the terms proposed by another party and that other part upon that belief enters unto a contract with him
In essence, what matters is if a reasonable person would determine there to be a contract, not what the parties involved believe
Commercial necessity
The courts look at what a reasonable person would conclude as it cannot reveal parties true intentions
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Freedom of contract
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In the 19th century, the courts would only interfere for limited reasons such as misrepresentation or if the contract was illegal in nature
Do not interfere to create bad bargain, even in situations of disproportionate economic power balances
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But this may advantage the buyer, as many sellers of a single product would have to cater their terms to the buyers asking to gain an advantage over their business competition
Will theory
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Closely related to the idea of “laissez-faire” which is the idea that the state should not infringe on individual freedoms
Courts and Parliament should not interfere with agreements between individuals and they should be upheld in court
Prime sight v Lavarello
Lord Wilson: “parties are ordinarily free to contract on whatever terms they choose, and the courts role is to enforce them”