LAW IRAC PUSSYCLART BLOCK

Costa v ENEL (1964)

Introduction | EU Law — Issue: Whether EU law takes precedence over conflicting national legislation. Rule: The EEC Treaty created a new legal order; member states voluntarily transferred sovereign rights to the Community. EU law is autonomous and supreme and cannot be displaced by domestic legislation whether earlier or later in time. Application: Costa argued Italy's nationalisation of electricity violated the Treaty of Rome. On ECJ referral, the court held EU law as an independent source could not be overridden by domestic provisions. Conclusion: EU law holds supremacy over all national laws ensuring uniform application. Key Principle: EU law takes precedence over conflicting national law regardless of whether that national law is earlier or later in time.

Guthing v Lynn (1831)

Contract I | Formation — Issue: Whether a promise to pay extra "if the horse was lucky" constituted a valid offer with sufficiently certain terms. Rule: The terms of an offer must be definite and clear. Vague or ambiguous language cannot give rise to a binding contractual obligation. Application: Guthing bought a horse for £63, agreeing to pay £5 more "if the horse was lucky." The court found "lucky" was entirely undefined with no clear standard against which the condition could be measured. Conclusion: The condition was too vague to be enforceable. Only the £63 purchase price was legally binding. Key Principle: Offer terms must be sufficiently certain — vagueness prevents a binding contract from arising.

Bloom v American Swiss Watch Co (1915)

Contract I | Formation — Issue: Whether Bloom could claim an advertised reward when he gave information leading to the arrest of thieves but had no prior knowledge of the reward offer. Rule: An offer must be communicated to and known by the offeree before it can be accepted. You cannot accept an offer you do not know about. Application: American Swiss Watch Co advertised a reward for information about jewel thieves. Bloom provided the information without knowing about the reward. Merely performing the requested act was insufficient without knowledge and intention to accept. Conclusion: No contract existed. The offer had not been communicated to Bloom before he acted. Key Principle: Knowledge and intention to contract are prerequisites to valid acceptance.

Harvey v Facey (1893)

Contract I | Formation — Issue: Whether Facey's telegram stating a £900 lowest price constituted a binding offer that Harvey had accepted, or merely a supply of information. Rule: There must be a clear unequivocal offer expressing willingness to be legally bound. A statement of information even one containing a price is not an offer. Application: Harvey asked "Will you sell Bumper Hall Pen? Telegraph lowest price." Facey replied "Lowest price £900." Harvey said "We agree to buy at £900." Facey's reply only gave information with no intention to be bound. Harvey's telegram was itself an offer that Facey never accepted. Conclusion: No contract was formed. A mere statement of lowest acceptable price does not constitute an offer to sell. Key Principle: A statement of information — even one containing a price — is not an offer. Only a definite offer expressing willingness to be bound can be accepted.

Pharmaceutical Society v Boots (1953)

Contract I | Invitation to Treat — Issue: Whether displaying drugs on self-service shelves constituted an offer accepted when customers selected items, meaning sales occurred without pharmacist supervision in breach of the Pharmacy and Poisons Act 1933. Rule: Display of goods in a shop with a price attached is not an offer — it is an invitation to treat. The offer is made by the customer at the point of payment; the retailer accepts or may decline at the till. Application: The Society argued shelf display equals offer and picking up an item equals acceptance. The Court of Appeal rejected this — if a contract formed when a customer placed items in a basket, the customer would be bound and could not put items back without breaching. Conclusion: Display of goods is an invitation to treat. The customer offers to buy at the till. No statutory breach occurred. Key Principle: Display of goods is always an invitation to treat, never an offer. The customer makes the offer at the till; the retailer retains the right to refuse.

Fisher v Bell (1961)

Contract I | Invitation to Treat — Issue: Whether displaying a flick knife in a shop window with a price tag constituted "offering for sale" under the Restriction of Offensive Weapons Act 1959. Rule: "Offer" in a statute carries its precise contract law meaning. A shop window display is an invitation to treat — the customer makes the offer at the till. Application: The defendant displayed a flick knife with a price ticket. The court declined to expand the technical meaning of "offer" beyond its contractual definition to fulfil the statute's apparent purpose. Conclusion: Display of the knife was an invitation to treat, not an offer of sale. Defendant not guilty. Parliament subsequently amended the Act to add "exposes for the purpose of sale" closing the loophole. Key Principle: Display of goods whether on shelves or in a shop window is always an invitation to treat. Statutory "offer" means offer in the contract law sense.

Partridge v Crittenden (1968)

Contract I | Invitation to Treat — Issue: Whether a magazine advertisement for Bramblefinch birds at 25s each constituted an "offer for sale" under the Protection of Birds Act 1954. Rule: Advertisements are generally construed as invitations to treat not offers. Treating ads as offers would expose advertisers to unlimited contractual liability since no quantity is specified. Application: Mr Partridge placed an ad in Cage and Aviary Birds magazine. Treating a price-list as an offer to supply an unlimited quantity would potentially expose the seller to obligations he could not carry out — both legally and commercially absurd. Conclusion: The advertisement was an invitation to treat. Conviction overturned. Key Principle: Ordinary advertisements are invitations to treat not offers. They invite customers to make an offer; no legal obligation arises merely from placing an ad.

Blackpool & Fylde Aero Club v Blackpool BC (1990)

Contract I | Invitation to Treat — Issue: Whether the Council's invitation to tender created a binding legal obligation to consider all conforming tenders submitted before the deadline. Rule: Invitations to tender are normally invitations to treat but may give rise to a collateral contract obliging the inviting party to consider all conforming tenders received in time — particularly where there are few invitees, terms are non-negotiable, and a strict deadline is set. Application: The Club's tender was submitted on time but mistakenly marked late and ignored. Bingham LJ held that the specific circumstances — selected invitees, clear procedure, strict deadline, history of dealing — implied an undertaking to consider all conforming tenders. Conclusion: The Council breached an implied contractual obligation to consider the Club's tender. Key Principle: An invitation to tender creates a collateral obligation to consider all conforming bids — but NOT to accept any of them. The inviter retains full discretion over which bid to accept.

Barry v Davies (2000)

Contract I | Invitation to Treat — Issue: Whether an auction held without a reserve price was a binding offer to sell to the highest bidder so that the auctioneer could not withdraw items when bids were considered too low. Rule: At an auction without reserve there is a collateral contract: the auctioneer promises to sell to the highest bidder. Consideration is the bidder's detriment and benefit to the auctioneer in higher attendance and prices. Application: New engine analysers worth £14,521 each were auctioned without reserve. The only bids were £200 each. The auctioneer refused and later sold them for £750 each. The no-reserve promise raised a binding collateral contract. Conclusion: The auctioneer was obliged to sell to the highest bidder. Damages of £27,600 awarded. Key Principle: Auction without reserve = a binding collateral promise to sell to the highest bidder however low that bid may be. The auctioneer cannot withdraw.

Routledge v Grant (1828)

Contract I | Termination of Offer — Issue: Whether an offeror is legally bound to keep an offer open for the stated time period even without consideration for that promise. Rule: An offer may be revoked at any time before acceptance even if the offeror promised to keep it open for a fixed period unless that promise is itself supported by separate consideration. Application: Grant offered to sell his property to Routledge promising to keep the offer open for six weeks. Grant revoked it before expiry. The promise to keep the offer open was an unenforceable unilateral undertaking unsupported by consideration. Conclusion: Grant could revoke freely before acceptance. No binding contract was formed. Key Principle: A promise to keep an offer open is only binding if supported by separate consideration. Without that the offeror may revoke at any moment before acceptance.

Byrne v Van Tienhoven (1880)

Contract I | Termination of Offer — Issue: Whether revocation of an offer is effective when posted or only when actually communicated to the offeree. Rule: Revocation is effective only when communicated to and received by the offeree. The postal rule does NOT apply to revocations. Acceptance is effective on posting; revocation is effective only on receipt — the rules operate asymmetrically. Application: Van Tienhoven posted an offer (1 Oct, received 11 Oct). Byrne accepted by telegram (11 Oct). Van Tienhoven had posted a revocation (8 Oct) that only arrived 20 Oct. Posting the revocation on 8 Oct was not enough to end the offer before Byrne's acceptance. Conclusion: Binding contract formed when Byrne telegraphed on 11 Oct. Revocation letter arrived too late. Key Principle: Revocation has no legal effect until the moment it actually reaches the offeree. Simply posting a revocation letter is not enough.

Errington v Errington and Woods (1952)

Contract I | Termination of Offer — Issue: Once an offeree has begun performing under a unilateral contract can the offeror revoke the offer before performance is complete? Rule: Once the offeree has begun performing a unilateral offer the offer cannot be revoked. There is an implied promise not to revoke contained within the offer itself. Application: A father purchased a house promising it to his son and daughter-in-law if they kept up mortgage payments. After the father's death his widow tried to reclaim possession. The court held that once the couple had commenced paying instalments the estate was bound. Conclusion: The daughter-in-law was entitled to remain in the house. A unilateral offer cannot be revoked once the offeree has commenced performance. Key Principle: Part-performance of a unilateral offer protects the offeree against revocation. The offer remains open until the offeree either completes or abandons performance.

Ramsgate Victoria Hotel v Montefiore (1866)

Contract I | Termination of Offer — Issue: Where no time limit for acceptance is specified how long does an offer remain open? Can acceptance after a significant delay still bind the offeror? Rule: Where no time limit is specified an offer must be accepted within a reasonable time. What is reasonable depends on the subject matter — volatile commercial assets like shares demand a much shorter window than interests in land. Application: Montefiore applied for shares in June; the company purported to accept in November (5-6 months later). By then share values had fallen and he declined. The court found the delay plainly unreasonable given the volatile nature of share prices. Conclusion: The offer had lapsed before purported acceptance. The company's action for specific performance failed. Key Principle: Every offer carries an implied time limit. Offers lapse after a reasonable period even without explicit expiry — and "reasonable" depends heavily on the nature of the subject matter.

Hyde v Wrench (1840)

Contract I | Termination of Offer — Issue: Can a party revive and accept an original offer after having first rejected it with a counter-offer? Rule: A counter-offer destroys the original offer. Once an offeree makes a counter-offer they have rejected the original offer and cannot later revive it. Any response introducing new or different terms kills the original. Application: Wrench offered his farm for £1,000. Hyde counter-offered £950. Wrench declined. Hyde then purported to accept the original £1,000 offer. The court held Hyde's counter-offer had extinguished the original — there was nothing left to accept. Conclusion: No contract. Hyde's action for specific performance dismissed. Key Principle: A counter-offer destroys the original offer entirely. Any response introducing new or different terms kills the original; the original terms are gone unless freshly offered.

Stevenson v McLean (1880)

Contract I | Termination of Offer — Issue: Whether Stevenson's telegraphic enquiry asking if McLean would accept different terms was a counter-offer destroying the original offer or merely a request for information leaving it intact. Rule: A request for information is not a counter-offer. It does not terminate the original offer which remains open for acceptance. A counter-offer must introduce new terms as a firm proposal not merely explore possibilities. Application: McLean offered iron "40s, open till Monday." Stevenson asked whether he would accept payment over two months. McLean sold to another party and sent revocation at 1:25pm. Stevenson accepted the original offer at 1:34pm before receiving the revocation. The inquiry was a question not a firm counter-proposal. Conclusion: Binding contract formed. The inquiry left the offer intact; revocation came too late. Key Principle: A mere enquiry or request for information does not terminate an offer — contrast with Hyde v Wrench. The offer remains fully open for acceptance.

Carlill v Carbolic Smoke Ball Co (1893)

Contract I | Acceptance — Issue: Whether the company's advertisement promising £100 to anyone who used their smoke ball and still caught flu was a binding offer, whether it could be accepted by performance without prior communication, and whether there was sufficient consideration. Rule: A public advertisement containing a promise conditional on performance can be a unilateral contract offer. Acceptance occurs on commencement of performance without communication to the offeror; performance of the condition constitutes good consideration. Application: The company deposited £1,000 in a bank as evidence of sincerity. Mrs Carlill used the smoke ball three times daily for two months as instructed and still caught flu. The company refused to pay. The bank deposit showed genuine intent; performance without notification was contemplated; buying and using the product was good consideration. Conclusion: Binding unilateral contract. Mrs Carlill succeeded. Key Principle: An advertisement can be a binding offer not merely an invitation to treat. Performance constitutes both acceptance and consideration in a unilateral contract — no prior communication needed.

Butler Machine Tool v Ex-Cell-O (1979)

Contract I | Acceptance — Issue: Where both parties use conflicting standard terms which set governs the contract — the battle of the forms problem. Rule: Each set of differing standard terms is a counter-offer killing the previous offer. The "last shot" rule: the contract is governed by the last set of terms sent and received without objection before performance. Application: Butler offered a machine with a price variation clause. Ex-Cell-O replied with their own terms (no price variation clause) and included an acknowledgment slip for signature. Butler signed and returned the slip — accepting Ex-Cell-O's counter-offer without reserving its own terms. Conclusion: Contract formed on Ex-Cell-O's terms. Butler could not increase the price. Key Principle: In a battle of forms the last shot wins: whoever fires the final set of terms that the other party accepts without objection has their terms govern the contract.

Entores v Miles Far East Corp (1955)

Contract I | Acceptance — Issue: Does the postal rule apply to contracts formed by telex or other instantaneous communication? When and where does acceptance take effect? Rule: For instantaneous communications acceptance is only complete when and where it is received by the offeror. The postal rule has no application. Unlike postal acceptance (effective on posting) instantaneous acceptance is effective on receipt. Application: London company Entores telexed an offer to Amsterdam-based Miles Far East; Miles sent acceptance by telex. Denning LJ: telex is virtually instantaneous — if someone shouts an acceptance across a noisy room and it isn't heard no contract forms. Acceptance was received in London. Conclusion: Contract formed in London; English law applied. Key Principle: The postal rule is confined to postal and delayed communication. For all instantaneous methods — telex, telephone, fax, email — a contract is only formed when and where acceptance is actually received.

Brinkibon v Stahag Stahl (1983)

Contract I | Acceptance — Issue: Location of contract formation when acceptance was sent by telex from London to Vienna — critical for determining whether English or Austrian law applied. Rule: The House of Lords affirmed Entores: the receipt rule applies to instantaneous communications such as telex. But where messages are sent outside office hours, pass through intermediaries, or suffer delays courts must assess the situation flexibly rather than apply a rigid rule. Application: Brinkibon (London) bought steel from Stahag Stahl (Vienna). Brinkibon telexed its acceptance to Vienna. The House of Lords applied the receipt rule — contract formed in Vienna not London. Conclusion: Contract formed in Vienna; Austrian law applied. Brinkibon's application to serve out of jurisdiction failed. Key Principle: Entores confirmed and refined: receipt rule governs instantaneous communication but courts must assess non-standard scenarios such as out-of-hours messages and intermediaries flexibly.

Yates Building Co v Pulleyn (1975)

Contract I | Acceptance — Issue: Whether an offeree who fails to use the specific method of acceptance prescribed (registered or recorded delivery) but uses an equally effective alternative (ordinary post) has validly accepted. Rule: Where an offeror prescribes a method of acceptance but does not insist it is the only valid mode, acceptance by any method that is no less advantageous to the offeror will suffice. Courts distinguish mandatory requirements (strict compliance required) from directory requirements (substance sufficient). Application: Option clause required acceptance "by registered or recorded delivery post." Yates accepted by ordinary post; letter was received. The registered/recorded requirement was for the offeree's benefit (proving posting) not for the offeror. It was directory not mandatory. Conclusion: Valid acceptance; binding contract formed. Defendant liable. Key Principle: A prescribed acceptance method is only mandatory if the offeror uses unambiguous exclusive language. Otherwise any equally effective alternative that achieves the same practical outcome will suffice.

Felthouse v Bindley (1862)

Contract I | Acceptance — Issue: Whether silence or failure to reject can constitute acceptance. Can an offeror impose a contract by declaring that silence will be treated as acceptance? Rule: Acceptance cannot be implied from silence. An offeror cannot unilaterally bind an offeree by declaring that non-response equals acceptance. Acceptance requires a positive communicated act. Application: Felthouse wrote to his nephew offering to buy a horse stating "If I hear no more about him I consider the horse mine at £30 15s." The nephew never replied but mentally intended to accept and instructed auctioneer Bindley not to sell the horse. Bindley forgot and sold it. The nephew's internal intention was not communicated acceptance. Conclusion: No contract between uncle and nephew. Felthouse's conversion action against Bindley failed. Key Principle: Silence does not constitute acceptance. Acceptance must be a positive communicated act.

Adams v Lindsell (1818)

Contract I | Acceptance — Issue: Whether a binding contract forms when a posted acceptance is dispatched or only when received by the offeror. Rule: The postal rule: acceptance by post is effective the moment the letter is posted not when it is received. If receipt were required each party would need to wait for confirmation of receipt making postal contracts impractical. Application: Lindsell wrote offering wool requesting a reply "in course of post." His letter was misdirected and arrived late. Adams posted acceptance on 5 Sept. Before it arrived Lindsell — assuming Adams had declined — sold the wool to a third party. The delay was Lindsell's own fault. Conclusion: Contract formed when Adams posted acceptance. Lindsell liable for breach. Key Principle: The postal rule places the risk of delay or loss in the post on the offeror who chose to negotiate by post. Offerors can avoid this by stipulating actual receipt is required.

Household Fire Insurance v Grant (1879)

Contract I | Acceptance — Issue: Does acceptance take effect on posting even if the acceptance letter is never received by the offeror? Rule: The postal rule applies even if the letter of acceptance is lost in the post and never received. By sending an offer anticipating postal reply the offeror authorises the post office as their agent. Once properly posted the contract is complete and irrevocable. Application: Grant applied for shares; the company posted a letter of allotment which was lost in the post. When the company later sought payment Grant refused claiming no contract. The majority held that posting the allotment letter completed the contract. Conclusion: Valid contract; Grant was a shareholder and liable for the outstanding amount. Key Principle: Once a letter of acceptance is properly posted the contract is complete and irrevocable even if the letter is lost delayed or destroyed. The offeror must expressly require actual receipt to avoid this.

Holwell Securities v Hughes (1974)

Contract I | Acceptance — Issue: Whether the postal rule applied to an option exercisable "by notice in writing" within six months where the acceptance letter was lost in the post. Rule: The postal rule does not apply when the express terms of the offer specify that acceptance must reach the offeror or when applying it would produce manifest inconvenience and absurdity. The word "notice" connotes something received and known not merely dispatched. Application: Dr Hughes granted an option exercisable "by notice in writing" within six months. Holwell Securities posted their notice five days before expiry; it was lost in the post. "Notice in writing" required actual receipt. A subsequent telephone call did not substitute for written notice. Conclusion: No valid exercise of the option. Hughes was not bound to sell. Key Principle: The postal rule is a default not an absolute rule. Express language requiring "notice" or "actual receipt" displaces it.

Greenclose v National Westminster Bank (2014)

Contract I | Acceptance — Issue: Whether the Bank validly exercised its right to extend a financial instrument by emailing notice before the deadline. Does the postal rule apply to emails? Is arrival in an inbox sufficient to constitute "giving notice"? Rule: Email is instantaneous communication — the postal rule does not apply; the receipt rule governs. Language requiring notice to be "given to" a person may demand actual awareness by the recipient not just inbox delivery. Contractual notice provisions must be strictly followed. Application: The Bank tried to extend a five-year interest rate collar by emailing notice before the deadline. The 1992 ISDA Master Agreement made no provision for email. Moreover "giving notice to" Greenclose required the recipient to actually see it. Conclusion: Notice invalid. The collar transaction ended on its termination date. NatWest ordered to repay all sums paid by Greenclose since that date with interest. Key Principle: Email is instantaneous; the postal rule does not apply. Even receipt in an inbox may not suffice — "given to" a person may require actual awareness. Contractual notice provisions must be followed strictly.

L'Estrange v Graucob (1934)

Contract II | Terms & Exclusion Clauses — Issue: Whether a party is bound by terms in a contract they signed but never read or understood. Rule: A person who signs a contractual document is bound by all its terms regardless of whether they have read or understood them. Ignorance of the terms is no defence absent misrepresentation or fraud. Application: Mrs L'Estrange signed an order form for a cigarette machine containing in small print a clause excluding all implied warranties. She had not read it. She later sued when the machine proved defective. Conclusion: Her claim failed. Her signature incorporated the exclusion clause into the contract. Key Principle: Signature on a contractual document binds the signatory to all its terms — read or unread.

Chapelton v Barry UDC (1940)

Contract II | Terms & Exclusion Clauses — Issue: Whether a term printed on a receipt or ticket could be incorporated where a reasonable person would not expect it to contain contractual conditions. Rule: A document must be one which a reasonable person would expect to contain contractual terms for those terms to be incorporated by notice. A mere receipt is not a contractual document. Application: Chapelton hired a deckchair receiving a ticket he placed in his pocket unread. The ticket contained an exemption clause. He was injured when the chair collapsed and sued the council. Conclusion: Claim succeeded. The ticket was merely a receipt not a contractual document. A reasonable person would not expect it to impose terms so the clause was not incorporated. Key Principle: A document must be of a contractual character before terms printed on it can be incorporated by notice.

Thornton v Shoe Lane Parking (1971)

Contract II | Terms & Exclusion Clauses — Issue: Whether an exclusion clause can be incorporated when notice of it is given only after the contract has already been formed. Rule: Notice of a term must be given before or at the time of contracting. Terms communicated after the contract is concluded cannot be incorporated. Unusual or onerous clauses require greater notice — the "red hand" rule per Denning LJ. Application: Thornton entered a car park after a machine issued a ticket. The ticket referred to conditions displayed inside which excluded liability for personal injury. Thornton was injured on the premises. Conclusion: Claim succeeded. The contract was formed at the machine before the ticket was issued. The conditions came too late; the clause excluding personal injury liability was not incorporated. Key Principle: Terms must be communicated before the contract is formed. The more onerous the clause the greater the notice required.

Olley v Marlborough Court (1949)

Contract II | Terms & Exclusion Clauses — Issue: Whether an exclusion clause displayed in a hotel room could be incorporated where the contract was already concluded at the reception desk. Rule: Contractual terms must be communicated before or at the moment of contracting. A notice seen only after the contract is formed comes too late and cannot be incorporated. Application: Mrs Olley booked into a hotel at the front desk. On arriving in her room she saw a notice disclaiming liability for guests' lost property. Her fur coat was later stolen due to the hotel's negligence. Conclusion: Claim succeeded. The contract was made at reception before Mrs Olley had any opportunity to see the notice. It was communicated too late and was therefore not incorporated. Key Principle: Post-contract notices cannot incorporate terms. The moment of formation fixes which terms are binding.

Spurling v Bradshaw (1956)

Contract II | Terms & Exclusion Clauses — Issue: Whether an exclusion clause can be incorporated into a contract through a consistent course of previous dealings between the parties even without fresh notice each time. Rule: Where parties have contracted repeatedly on the same terms those terms may be incorporated by virtue of their prior course of dealing without requiring explicit notice on each occasion. Application: Bradshaw had stored goods with Spurling on multiple occasions over many years always receiving a "landing account" containing exclusion clauses. He sued when barrels of orange juice were returned damaged. Conclusion: Claim failed. The consistent prior course of dealing meant the exclusion clause was incorporated. Bradshaw was taken to have known and accepted the standard terms used throughout their relationship. Key Principle: A sufficiently regular and consistent course of dealing can incorporate terms without fresh notice on each occasion.

Andrews Bros v Singer (1934)

Contract II | Terms & Exclusion Clauses — Issue: Whether an exclusion clause covering implied terms could also exclude an express term of the contract where the clause was ambiguous. Rule: Ambiguous exclusion clauses are construed strictly against the party relying on them (contra proferentem). Clear express terms cannot be excluded without equally clear and explicit language. Application: Andrews contracted to buy "new Singer cars." A clause excluded "implied conditions and warranties." Singer delivered a second-hand car. They argued the exclusion clause covered the obligation to supply a new vehicle. Conclusion: Claim succeeded. The requirement to deliver a new car was an express term. The clause only excluded implied terms; it could not on its plain wording exclude an express contractual obligation. Key Principle: Exclusion clauses excluding "implied terms" do not without express language extend to exclude express obligations. Ambiguity is resolved against the drafter.

Hollier v Rambler Motors (1972)

Contract II | Terms & Exclusion Clauses — Issue: Whether an exclusion clause covered loss caused by the defendant's own negligence without expressly saying so and whether three or four dealings over five years could constitute a course of dealing. Rule: To exclude liability for negligence the clause must expressly refer to negligence or use language that can only be read that way. A course of dealing must be regular and consistent — sporadic transactions do not suffice. Application: Hollier had used Rambler's garage three or four times over five years sometimes signing a form excluding liability for fire damage. On this occasion no form was signed; his car was damaged by a fire caused by Rambler's negligence. Conclusion: Claim succeeded on both grounds. Three or four transactions over five years was too sporadic to constitute a course of dealing and the clause did not expressly mention negligence. Key Principle: Negligence must be expressly mentioned to be excluded. Three to four dealings over five years are insufficient to establish a course of dealing.

Taylor v Caldwell (1863)

Contract II | Frustration — Issue: Whether a party is excused from performance when the subject matter of the contract is destroyed through no fault of either party. Rule: Where performance depends on the continued existence of a specific thing and that thing perishes without the fault of either party both parties are discharged from their obligations. This is the foundation of the doctrine of frustration. Application: Taylor had hired a music hall from Caldwell for a series of concerts but the hall burned down before any of them took place. Conclusion: The claim failed. The contract was frustrated by the destruction of the subject matter and Caldwell was not liable for the loss. Key Principle: Destruction of the subject matter of a contract without either party's fault discharges both parties from performance.

Condor v Barron Knights (1966)

Contract II | Frustration — Issue: Whether a contract of personal service could be frustrated where the party providing that service became medically incapable of fulfilling it fully. Rule: Where a contract requires personal performance and the party becomes permanently or substantially incapable of performing due to illness the contract may be frustrated even if some partial performance remains possible. Application: Condor was contracted as the band's drummer required to perform up to seven nights a week but suffered a serious mental breakdown and was medically advised he could only safely perform on four nights a week. Conclusion: The contract was held to be frustrated because his incapacity meant he could no longer perform the substance of what had been agreed. Key Principle: Substantial medical incapacity rendering a party unable to perform the core of a personal service contract can frustrate it even if some partial performance remains possible.

Krell v Henry (1903)

Contract II | Frustration — Issue: Whether a contract could be frustrated where the common purpose underlying it was defeated even though performance remained physically possible. Rule: Frustration can occur where a supervening event destroys the foundation or common purpose of the contract provided that purpose was known to both parties at the time of contracting. Physical possibility of performance is not enough to prevent frustration. Application: Henry hired a room from Krell specifically to watch the coronation procession of Edward VII though the contract did not expressly state this purpose; the coronation was then postponed due to the King's illness. Conclusion: The claim for the balance of the hire fee failed because the common purpose known to both parties had been destroyed frustrating the contract. Key Principle: Frustration extends beyond physical impossibility — destruction of the shared commercial purpose known to both parties at formation suffices.

Fibrosa v Fairbairn Lawson (1943)

Contract II | Frustration — Issue: Whether a pre-paid deposit could be recovered where a contract was frustrated by the outbreak of war rendering performance illegal. Rule: Where a contract is frustrated and there has been a total failure of consideration money paid under it can be recovered at common law. The frustrated party has received nothing of what they paid for. Application: Fibrosa, a Polish company, had paid a deposit to Fairbairn for machinery to be delivered to Poland but the German occupation of Poland made performance illegal and the contract was frustrated. Conclusion: The House of Lords held the deposit was recoverable because there had been a total failure of consideration — Fibrosa had received nothing of what it had paid for. Key Principle: Money paid under a frustrated contract is recoverable at common law where there has been a total failure of consideration.

Davis Contractors v Fareham UDC (1956)

Contract II | Frustration — Issue: Whether a contract could be frustrated merely because performance had become more burdensome or expensive than anticipated due to unforeseen circumstances. Rule: Frustration occurs where without the fault of either party a supervening event renders the contractual obligation radically different from what was undertaken — not merely more difficult or onerous. This is Lord Radcliffe's radical difference test. Application: Davis Contractors agreed to build houses within eight months but due to labour and material shortages the work took twenty-two months and cost considerably more than anticipated; they argued the contract was frustrated so they could claim on a quantum meruit basis. Conclusion: The claim failed because the contract though more burdensome remained radically the same undertaking. Key Principle: The radical difference test: frustration requires the obligation itself to be transformed not merely made harder slower or more expensive.

Tsakiroglou v Noblee Thorl (1962)

Contract II | Frustration — Issue: Whether the closure of the Suez Canal forcing a longer and more expensive route could frustrate a contract for the shipment of goods. Rule: Mere increased expense or inconvenience in performing a contract does not amount to frustration. The change must make performance radically different in nature not just more costly. Application: Tsakiroglou had contracted to ship Sudanese groundnuts to Hamburg via the Suez Canal but the canal closed and the only alternative was the much longer Cape of Good Hope route significantly increasing costs. Conclusion: The House of Lords held the contract was not frustrated. The goods could still be shipped and increased expense and delay alone did not make performance radically different from what had been promised. Key Principle: Increased cost or difficulty of performance without more does not frustrate a contract. The obligation must become fundamentally different in character.

Hadley v Baxendale (1854)

Contract II | Remedies — Issue: How far down the chain of consequences a defendant should be liable for losses flowing from their breach of contract. Rule: Two limbs: first a defendant is liable for losses arising naturally from the breach according to the usual course of things; second a defendant is liable for losses that were in the reasonable contemplation of both parties at the time of contracting as a probable result of breach. Application: Hadley's mill was stopped when a crankshaft broke and he contracted with Baxendale to deliver it for repair but Baxendale delayed. Hadley claimed for lost profits during the extended stoppage. Baxendale had not been told the mill would be idle without the shaft. Conclusion: The claim for lost profits failed because the loss was not within the reasonable contemplation of both parties and fell under neither limb. Key Principle: Damages are limited to losses that either arise naturally from the breach or were within the reasonable contemplation of both parties at the time of contracting.

Ruxley Electronics v Forsyth (1995)

Contract II | Remedies — Issue: Whether a claimant is entitled to the full cost of reinstatement where that cost is wholly disproportionate to the actual benefit gained or whether damages should be limited to a modest sum for loss of amenity. Rule: Where the cost of cure is disproportionate and the difference in market value is nil or negligible the court may award a modest sum for loss of amenity reflecting the claimant's loss of the pleasurable benefit they had contracted for. Application: Forsyth contracted for a swimming pool to be built to a depth of 7ft 6in for diving but it was built to only 6ft 9in; the market value of the property was unaffected yet the cost of rebuilding the pool to the correct depth would have been nearly £22,000. Conclusion: The House of Lords awarded instead £2,500 for loss of amenity recognising that Forsyth had lost a personal benefit he had bargained for even though he had suffered no financial loss. Key Principle: Where reinstatement is disproportionate and there is no financial loss damages may be awarded for loss of amenity rather than cost of cure.

Donoghue v Stevenson (1932)

Tort | Duty of Care — Issue: Whether a manufacturer owed a duty of care in tort to the ultimate consumer of their product with whom they had no contractual relationship. Rule: The neighbour principle (Lord Atkin): you must take reasonable care to avoid acts or omissions which you can reasonably foresee would be likely to injure your neighbour — persons so closely and directly affected by your act that you ought reasonably to have them in contemplation. Application: Mrs Donoghue consumed ginger beer purchased by a friend only to discover a decomposed snail in the opaque bottle. She could not sue in contract as she was not a party to the purchase so she brought a claim in negligence against the manufacturer Stevenson. Conclusion: The House of Lords held that Stevenson owed her a duty of care as the ultimate consumer of his product establishing the modern law of negligence and the neighbour principle as its foundation. Key Principle: The neighbour principle: a duty of care is owed to all persons foreseeably and closely affected by one's acts or omissions.

Caparo Industries v Dickman (1990)

Tort | Duty of Care — Issue: Whether auditors owed a duty of care to investors who relied on a company's audited accounts when deciding to acquire shares in that company. Rule: Three-stage test: (1) the damage must be reasonably foreseeable; (2) there must be a relationship of sufficient proximity between the parties; and (3) it must be fair just and reasonable to impose a duty in the circumstances. All three must be satisfied. Application: Caparo purchased shares in a company and then made a takeover bid relying on audited accounts prepared by Dickman which turned out to be inaccurate; they sued the auditors for their resulting losses. Conclusion: The claim failed. The auditors owed their duty to the company as a whole and not to individual investors or potential bidders — proximity and fair-just-reasonable requirements were not satisfied. Key Principle: The Caparo three-stage test: foreseeability + proximity + fair just and reasonable. All three must be satisfied for a duty of care to arise.

Hedley Byrne v Heller (1964)

Tort | Duty of Care — Issue: Whether a party could owe a duty of care in respect of a negligent statement causing pure economic loss in the absence of any contractual or fiduciary relationship. Rule: A duty of care can arise in respect of negligent misstatements where there is a special relationship characterised by the defendant voluntarily assuming responsibility for the statement and the claimant reasonably relying on it. Application: Hedley Byrne asked their bank to obtain a creditworthiness reference from Heller the bank of a client on whose behalf they were placing orders. Heller gave a favourable reference but added a disclaimer of responsibility. Hedley Byrne suffered financial loss when the client went into liquidation. Conclusion: A duty of care for negligent misstatements could in principle exist where there was a special relationship of assumed responsibility and reasonable reliance but on the facts the disclaimer negated any such duty. Key Principle: A duty of care for negligent misstatement requires voluntary assumption of responsibility by the defendant and reasonable reliance by the claimant.

Nettleship v Weston (1971)

Tort | Breach of Duty — Issue: Whether a learner driver should be held to a lower standard of care than a competent driver given their inexperience. Rule: The standard of care in negligence is objective and does not vary according to the defendant's individual skill or experience. A learner driver is held to the same standard as a reasonably competent qualified driver. Application: Weston was a learner driver being taught by her friend Nettleship who checked she had insurance before agreeing to teach her. She lost control of the car and Nettleship was injured. Conclusion: The Court of Appeal held she had breached her duty by falling below the standard of a competent driver and the fact that she was a learner was no defence though Nettleship's damages were reduced by half for contributory negligence. Key Principle: The standard of care is objective: a learner driver is judged against the competent driver not against the reasonable learner.

Orchard v Lee (2009)

Tort | Breach of Duty — Issue: Whether a thirteen-year-old child could be held to have breached a duty of care when playing in a playground in a way that accidentally injured a supervisor. Rule: A child defendant is held to the standard of an ordinarily careful child of the same age not the standard of a reasonable adult and will only breach their duty if their conduct was careless to a very high degree. Application: Orchard a thirteen-year-old was running and playing tag in a playground when he collided with Lee a lunchtime supervisor causing her serious facial injuries. Conclusion: The claim failed because Orchard's behaviour was ordinary boisterous play that any child of his age might engage in and did not fall below the standard expected of a child of that age. Key Principle: Children are judged against the standard of an ordinarily careful child of the same age not an adult standard.

Phillips v Whiteley (1938)

Tort | Breach of Duty — Issue: Whether a jeweller who pierced ears was required to meet the same standard of sterile technique as a surgeon when performing that procedure. Rule: A defendant is judged against the standard of a reasonably competent person in their particular trade or profession not against the higher standard of a different profession that might also undertake similar tasks. Application: Phillips had her ears pierced by Whiteley a jeweller and subsequently developed an abscess which she attributed to the procedure. Conclusion: The claim failed because Whiteley had taken the precautions that a reasonably competent jeweller would take. He was not required to meet the standard of a surgeon simply because the task involved piercing skin. Key Principle: The standard of care matches the profession actually undertaken not the highest profession that could theoretically perform the same act.

Bolam v Friern Hospital (1957)

Tort | Breach of Duty — Issue: Whether a doctor who administered electroconvulsive therapy without using relaxant drugs or restraints had breached the standard of care owed to his patient. Rule: The Bolam test: a professional is not negligent if they act in accordance with a practice accepted as proper by a responsible body of professional opinion in that field even if other practitioners would have acted differently. Application: Bolam suffered serious fractures during ECT treatment and argued the doctor was negligent in not warning him of the risks and not using restraints. Evidence showed that a responsible body of medical opinion supported the approach taken. Conclusion: The claim failed because the doctor's conduct accorded with a recognised and responsible body of medical practice satisfying the Bolam test. Key Principle: The Bolam test: a professional meets the standard of care by acting in accordance with a responsible body of opinion within their profession.

Bolitho v City and Hackney HA (1997)

Tort | Breach of Duty — Issue: Whether a defendant could always escape liability simply by pointing to a body of professional opinion supporting their conduct regardless of whether that opinion had a logical basis. Rule: The Bolam test is refined: the court is not bound to find no negligence merely because a body of professional opinion supports the defendant's conduct. That body of opinion must itself be capable of withstanding logical analysis and be reasonable and responsible. Application: A two-year-old child suffered brain damage and died after a doctor failed to attend and intubate him when called. The doctor argued that even had she attended she would not have intubated and that a responsible body of opinion supported not intubating in those circumstances. Conclusion: The court retains the power to reject expert opinion that is not logically defensible though on the facts the expert evidence against intubation was found to be reasonable. Key Principle: The Bolitho refinement: a body of professional opinion only satisfies Bolam if it is also logically defensible. Courts may reject opinion that lacks rational basis.

Wilsher v Essex AHA (1988)

Tort | Breach of Duty — Issue: Whether a junior doctor should be held to a lower standard of care than a more experienced colleague given their lack of experience and whether causation was established where multiple possible causes existed. Rule: A junior doctor is held to the standard of a reasonably competent doctor filling that particular post not a lower standard by reason of their inexperience. If out of their depth they must seek assistance from a more senior colleague. Application: A junior doctor in a neonatal unit mistakenly inserted a catheter into a vein rather than an artery to monitor oxygen levels. A more senior registrar failed to spot the error on checking. The baby subsequently developed an eye condition. Conclusion: The junior doctor was in breach by reference to the standard of the post but the causation claim failed because there were five distinct possible causes of the condition and the claimant had not established which caused it. Key Principle: Junior doctors are judged by the standard of the post not their experience. Where multiple independent causes exist the claimant must establish which caused the damage.

McGhee v National Coal Board (1973)

Tort | Causation & Remoteness — Issue: Whether a defendant could be held liable where their breach of duty materially increased the risk of harm but it could not be scientifically proved that it had actually caused the injury. Rule: Where a defendant's breach of duty materially contributes to the risk of the claimant sustaining damage and the damage is of the kind that risk was likely to produce that may be treated as a material contribution to the damage itself sufficient to establish causation. Application: McGhee worked in dusty brick kilns and contracted dermatitis. His employer was not at fault for the exposure during working hours but was in breach for failing to provide washing facilities meaning McGhee had to cycle home caked in dust materially increasing his exposure. Conclusion: The House of Lords held that materially contributing to the risk of injury was sufficient to establish causation and the employer was liable despite the impossibility of proving exactly when or how the dermatitis was caused. Key Principle: Materially contributing to the risk of damage of the type suffered can suffice to establish causation where precise scientific proof is impossible.

The Wagon Mound (1961)

Tort | Causation & Remoteness — Issue: Whether a defendant is liable for all damage directly caused by their negligence however unforeseeable or only for damage of a type that was reasonably foreseeable. Rule: A defendant is only liable for damage of a kind that a reasonable person would have foreseen as a likely consequence of their breach. Unforeseeable types of damage however directly caused are too remote. Application: The defendants negligently spilled furnace oil into Sydney Harbour. Sparks from welding works ignited the oil on the water causing a fire that destroyed the claimants' wharf. Conclusion: The defendants were not liable for the fire damage because while spillage of oil was foreseeable the ignition of oil on water in those circumstances was not reasonably foreseeable and the damage was therefore too remote. Key Principle: Remoteness of damage: a defendant is only liable for damage of a type that was reasonably foreseeable at the time of the breach.

Hughes v Lord Advocate (1963)

Tort | Causation & Remoteness — Issue: Whether a defendant escapes liability where the type of harm was foreseeable but it materialised in an unforeseeable way. Rule: A defendant is liable provided the type or kind of damage was reasonably foreseeable even if the precise manner in which it occurred was not. The defendant need not foresee the exact sequence of events leading to the injury. Application: Post Office workers left an open manhole guarded by a tent and paraffin lamps. A young boy took a lamp into the manhole to explore it fell in caused an explosion and he suffered severe burns. Conclusion: The defendants were liable because burns from fire were a foreseeable type of injury given the presence of open lamps and it did not matter that the explosion causing those burns occurred in an unforeseeable way. Key Principle: It is sufficient that the type of harm was foreseeable; the precise manner or extent of its occurrence need not be.

Smith v Leech Brain (1962)

Tort | Causation & Remoteness — Issue: Whether a defendant is liable for the full extent of a claimant's injury where that injury was far greater than expected due to a pre-existing vulnerability unknown to the defendant. Rule: The eggshell skull rule: a defendant must take their victim as they find them. Once some personal injury of the relevant type is foreseeable the defendant is liable for the full extent of the harm suffered even if that extent was unforeseeable due to the claimant's pre-existing condition. Application: Smith was a worker who suffered a burn to his lip when molten metal splashed on him due to his employer's negligence. The burn triggered a cancerous condition that had been latent in his lip tissue from which he died. Conclusion: The claim succeeded in full because a burn was a foreseeable consequence of the breach and the defendant was liable for the full consequences including the cancer regardless of Smith's pre-existing condition making the outcome far worse than anticipated. Key Principle: The eggshell skull rule: once some harm of the relevant type is foreseeable the tortfeasor is liable for the full extent of the damage however unforeseeable due to the claimant's pre-existing vulnerability.

McKew v Holland (1969)

Tort | Causation & Remoteness — Issue: Whether a defendant remains liable for further injury sustained by the claimant after the initial tort where that further injury results from the claimant's own unreasonable conduct. Rule: Where a claimant having suffered an initial injury caused by the defendant acts unreasonably in a way that leads to further injury that unreasonable conduct constitutes a novus actus interveniens breaking the chain of causation and relieving the defendant of liability for the subsequent harm. Application: McKew had suffered a leg injury due to his employer's negligence which occasionally caused his leg to give way without warning. He then attempted to descend a steep staircase with no handrail without assistance his leg gave way and he jumped to avoid falling fracturing his ankle severely. Conclusion: The defendants were not liable for the ankle injury because McKew had acted unreasonably in placing himself in a position where a further injury was foreseeable and his own conduct broke the chain of causation. Key Principle: A claimant's unreasonable conduct after the initial injury can constitute a novus actus interveniens breaking the chain of causation for any subsequent harm.

Salomon v Salomon (1897)

Company Law | Corporate Personality — Issue: Whether a company formed by a sole trader was genuinely a separate legal person from its founder or merely an agent or alias for him. Rule: A company once validly incorporated is a separate legal person entirely distinct from its members and directors capable of owning property entering contracts and incurring liabilities in its own name regardless of who controls it. Application: Salomon incorporated his boot-making business taking most of the shares himself and issuing himself secured debentures in respect of a loan to the company. When the company failed unsecured creditors argued the company was a sham and Salomon should be personally liable. Conclusion: The House of Lords held the company was a valid and separate legal entity and Salomon was not liable for its debts establishing the principle of separate corporate personality as the cornerstone of company law. Key Principle: A validly incorporated company is a legal person distinct from its members. The corporate veil cannot be lifted merely because one person controls the company.

Prest v Petrodel Resources (2013)

Company Law | Corporate Personality — Issue: Whether a court could pierce the corporate veil to reach assets held by companies controlled by a spouse in order to satisfy a matrimonial financial remedy order. Rule: The evasion principle (Lord Sumption): the court may only pierce the corporate veil where a person under an existing legal obligation deliberately interposes a company to evade that obligation. Mere use of the corporate form to achieve a legal result does not justify piercing. Application: Mrs Prest sought financial relief on divorce and argued that properties held by her husband's companies should be treated as his assets. The Supreme Court was asked whether the veil could be pierced to achieve this. Conclusion: The Supreme Court declined to pierce the veil on the evasion principle as the companies were formed before any matrimonial obligation arose but awarded the properties to Mrs Prest on the separate ground that the husband held them on resulting trust for himself through the companies. Key Principle: The veil may only be pierced where a company is interposed to evade an existing legal obligation — not merely to achieve a legally permissible outcome.

Adams v Cape Industries (1990)

Company Law | Corporate Personality — Issue: Whether an English parent company could be held liable for judgments obtained against its American subsidiary and whether the subsidiary's presence in the United States could be attributed to the parent. Rule: The separate legal personality of each company in a group is strictly maintained. Courts will not pierce the veil merely because companies are part of the same group operate a single economic enterprise or because it would be just and equitable to do so absent specific grounds such as agency sham or statutory provision. Application: Cape Industries a UK parent operated asbestos mining through subsidiaries. American claimants obtained judgments against a US subsidiary and sought to enforce them against the English parent. Conclusion: The Court of Appeal refused to pierce the veil holding that the group structure was legitimate the subsidiary was not the parent's agent and the mere fact of common ownership and economic unity was insufficient to treat the companies as one. Key Principle: Economic unity and common control within a corporate group do not justify piercing the veil. Each company remains a separate legal person.

Gilford Motor Co v Horne (1933)

Company Law | Corporate Personality — Issue: Whether a company formed by a former employee could be restrained by injunction where it was used as a vehicle to evade a valid restrictive covenant. Rule: Where a company is formed as a mere sham or facade to evade an existing legal obligation owed by the person who controls it the court will look behind the corporate form and grant relief against both the company and the individual. Application: Horne had entered into a covenant with his former employer Gilford Motor Co not to solicit their customers after leaving. He formed a company in his wife's name through which he proceeded to solicit those very customers. Conclusion: The Court of Appeal granted an injunction against both Horne and his company treating the company as a sham device formed for the sole purpose of evading the covenant. Key Principle: A company formed as a sham to evade an existing legal obligation will be treated as the alter ego of the individual behind it.

Jones v Lipman (1962)

Company Law | Corporate Personality — Issue: Whether a defendant could defeat an order for specific performance of a contract to sell land by transferring that land to a company he controlled. Rule: Where a company is used as a device or sham to evade an existing obligation the court will pierce the corporate veil and grant the remedy sought against both the individual and the company as if they were one. Application: Lipman contracted to sell land to Jones but wishing to avoid the sale transferred the land to a company he had acquired and controlled for that very purpose. He then argued he could not convey the land as it belonged to the company. Conclusion: Russell J granted specific performance against both Lipman and the company describing the company as a mask on Lipman's face and an instrument created to avoid recognition by the eye of equity. Key Principle: Using a company as a device to evade specific performance of a pre-existing obligation will be met with an order against both the individual and the company.

Harris' Patent (1985)

Competition & IP | Intellectual Property — Issue: Whether an invention made by an employee belonged to the employer where it was made in the course of duties not specifically focused on inventive activity. Rule: Under s.39 Patents Act 1977 an invention belongs to the employer where it was made in the course of the employee's normal duties or duties specifically assigned to them and the circumstances were such that an invention might reasonably be expected to result from those duties. Application: Harris was a storekeeper and salesman for a valve manufacturer who devised an improvement to a valve. He argued the invention was his own as inventing was not part of his job description. Conclusion: The claim failed because although Harris was not specifically employed to invent his duties brought him into sufficiently close contact with the relevant technology that an invention of this kind could reasonably have been expected to result from the performance of those duties. Key Principle: An employee need not be specifically employed to invent for s.39 PA 1977 to apply; it suffices that invention was a reasonably expected result of their normal duties.

Kelly v GE Healthcare (2009)

Competition & IP | Intellectual Property — Issue: Whether employee inventors were entitled to compensation under the Patents Act 1977 where their employer had derived outstanding benefit from patents registered in the employer's name. Rule: Under s.40 Patents Act 1977 where an invention belongs to an employer and that patent is of outstanding benefit to the employer having regard to the size and nature of the employer's undertaking the employee inventor is entitled to fair compensation. Application: Kelly and a colleague invented a highly successful radioactive tracer used in cardiac imaging which generated very substantial revenues for GE Healthcare over many years. Conclusion: The court awarded compensation to the inventors finding that the patent had been of outstanding benefit to the employer and that it was just and equitable for the inventors to receive a fair share of that benefit calculated as a percentage of the profits attributable to the patent. Key Principle: Where an employer-owned patent is of outstanding benefit to the employer s.40 PA 1977 entitles the employee inventor to a fair share of that benefit.

Reckitt & Colman v Borden (1990)

Competition & IP | Intellectual Property — Issue: Whether a manufacturer could bring a passing off action to prevent a competitor from selling lemon juice in a similar get-up to the one the claimant had used for many years. Rule: The classic trinity of passing off: (1) the claimant must have goodwill or reputation attached to their goods or services; (2) there must be a misrepresentation by the defendant likely to lead the public to believe the defendant's goods are those of the claimant; and (3) the claimant must have suffered or be likely to suffer damage as a result. Application: Reckitt & Colman had sold Jif lemon juice in a distinctive plastic lemon-shaped container for many years and sought to prevent Borden from marketing their lemon juice in a very similar container. Conclusion: All three elements of the trinity were satisfied — Reckitt had substantial goodwill in the get-up consumers were likely to be deceived into thinking Borden's product was Jif and damage to Reckitt's sales and reputation was the inevitable consequence. Key Principle: Passing off requires the classic trinity: goodwill + misrepresentation + damage. All three must be established.