Unit 2: The Agreement as a Key Pillar of Contract Law

Why is the agreement a key pillar of contract law

Determines whether a contract has been formed

What are the Key Determinants of an Agreement

• Parties reached an agreement

• Consideration was present

• The agreement was legal

• Parties entered the contract of their own free will, with knowledge of the facts and with the capacity to make a contract

What is the typical structure of an agreement

Offer and acceptance

What must happen for an Agreement to be established

Cumulative requirement (of all determinants)

How do we determine whether an agreement has been reached

Objective test

The Agreement

What is an offer (definition)

A clear intention to enter into a legally binding agreement.

Examples of Proposals NOT Offers

Advertisements

Price quotations

Auctions

What are the Requirements for a Valid Offer

Communication

Definiteness

Duration

The Agreement

What is Acceptance (definition)

Offeree's clear and unqualified agreement to the terms of an offer

Who can Accept an Offer?

Only the offeree may accept an offer

What is the caveat to who can accept an offer

Minors

(needs to be legally possible)

What are the Requirements for an Effective Acceptance

Instantaneous communication

Stipulations

Mailbox rule

Electronic communication

No Silence

Requirements for an Effective Acceptance

How can Instantaneous Communication be achieved

Face-to-face deals

Requirements for an Effective Acceptance

How can Stipulations be achieved

Using stipulated method (i.e. return mails, fax)

Requirements for an Effective Acceptance

How can Electronic Communication be achieved

Using E-Mail and U-signatures

Requirements for an Effective Acceptance

How can the “Mailbox rule“ be achieved

Using postal service is customary