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3rd Party liability where should control party doing damage

Home Office v Dorset Yachet Co. Ltd (1970, HL): Liable for those under your control, or who should be

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A director can leave office via

removal, resignation, retirement, not standing for re-election, death, dissolution of the company, bankruptcy, disqualification

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3

Acceptance definition

‘A positive act by a person to whom an offer has been made which, if unconditional, brings a binding contract into effect’

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4

Acceptance mirror image case law

Butler Machine Tools Ltd v Ex-Cell-O Ltd (1979)- The last (counter) offer is the binding one

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5

Acceptance of part performance case law

Sumpter v Hedges (1898)- Part performance can be acceptable, but has to be accepted voluntarily. However, if abandoned, no payment is due.

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Actual breach

failure to perform at all or properly once performance is due

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Agency arising from necessity

Agency created by an emergency requiring the agent to take reasonable steps to preserve the principal’s property

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Agency by agreement may be made

Formally by deed (power of attorney), informally (written or verbal), by implication (employer/employee)

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Agency by ratification

Acknowledgement that a prior obligation is binding, creating antecedent authority

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10

Agency from necessity conditions

Emergency occurs, action is for the owner’s benefit, communication with the principal is impossible

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Agency from necessity false case law

Sachs v Miklos (1948): Must truly be emergency and act for owner’s benefit

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12

Agency misrepresentation liability

Principal is liable for misrepresentation by agent

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13

Agency payment case law

G.T. Hodges & Sons v Hackbridge Residential Hotel (1939): Due payment if specified in contract

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14

Agency, suspicious behaviour case law

Quinn v CC Automotive Group (t/a Carcraft (2010)): If agent is believed to have authority but still doing what you’d expect from the employee, still an agent

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Agency, vicarious liability case law

Quinn v CC Automotive Group (t/a Carcraft (2010))

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Agent reasonable skill, below standard case law

Arensen v Casson Beckman Rutley & Co. (1977) Must act to the standard of the reasonable ___

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Agent reasonable skill, false claims, case law

Chaudry v Probhakar (1988, CA): Held to the standard of someone with the experience claimed

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Agent, avoidance of conflict, case law

Armstrong v Jackson (1917): Must avoid conflict of interest

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19

Agent

a person with actual authority to carry out business on behalf of another person

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Agent’s right to indemnity case law

Anglo Overseas Transport Ltd v Titan Industrial Corporation (1959): Expenses incidental to performing the contract can be claimed from the principal

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AGM functions

question directors about annual report, vote on resulutions

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Ambiguous exemption clauses may be (case law)

e.g. Andrews v Singer (1934) interpreted contra proferentem

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Ambiguous exemption clauses may be

interpreted contra proferentem

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An employer must issue a written statement of ____ within ____ of the start date or _______ - Statute

s1 Employment Rights Act 1996- key employment contract terms, 2 months, breach of warranty

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Anticipatory breach case law example

Hochster v De La Tour (1853)- breach doesn’t occur until performance is due, but anticipatory breach starts from notice and can sue and repudiate or wait and see what happens

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Anticipatory breach, frustration case law

Avery v Bowden (1855)- If breach occurs before actual breach, contract is frustrated and cannot sue

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Anticipatory breach, injured party

still expected to perform until breach

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28

Apparent authority, no real agent case law

Barrett v Deere (1828, HL) Principal allows 3rd party to believe there is an agency relationship, including not refuting agency

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Apparent authority, presenting greater authority case law

Racing UK Ltd v Doncaster Racecourse Ltd and Doncaster Borough Council (2005): If principal allows the 3rd party to believe the agent has greater authority, then liable for actions of agent. Includes not refuting

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Apparent or ostensible authority

the agent has no real authority but it appears that they do

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Appointment of administrator methods

decision from shareholders, directors or qualifying floating charge holder (QFCH) to petition the court for administration

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Appointment of administrator requirement for directors

majority decision

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Appointment of administrator requirement for shareholders

ordinary resolution

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34

Articles can be amended by (statute)

special resolution, S.21 CA 2006

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35

Articles of association forming contract statute

s.33 CA 2006, the constitution acts as a binding contract between the company and its members (but only re shareholder rights)

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Attempt to mitigate risks product liability case law

Tesco Stores Ltd and Another v Pollard (2006, CA): If a sufficient barrier to harm is created, okay

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Avoiding charges in liquidation

charges not registered in 21 days, transactions at an undervalue

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38

Beneficiaries to a contract privity statute

Rights of Third Parties Act 1999 S1- people who benefit from a contract are beneficiaries, so can sue

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Beneficiaries to a contract, changes, statute

Rights of Third Parties Act 1999 S2- beneficiaries are protected from cancellation or variation of a contract without their permission

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40

Breach of agency agreement means

can terminate agency relationship, repudiate agent, claim any bribe, claim damages and repudiate contract with 3rd party

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Breach of articles of association case law

Hickman v Romney March Sheep Breeders Association (1915): Bound by articles, so long as it refers to shareholder rights

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Breach of condition compensation

only damages, and can repudiate the contract

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43

breach of contract exclusion clause statute

UCTA 1977 s.3- cannot exclude liability for breach

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44

Breach of shareholder duty response

shareholders can vote to remove the director, and if the director is a shareholder, they can vote

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45

breach of SOGA 1979 exclusion clause statute

ss.6-7 UCTA 1977 doesn’t allow businesses to exclude implied terms for sale/ hire/purchase/supply of goods

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Breach of warranty compensation

Only damages

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Building contract quantifiable loss case law

correction, but in Ruxley Electronics & Construction Ltd v Forsyth (1995), correction wasn’t reasonable, so damage for loss of amenity

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48

Business agreements not binding exceptions case law

Jones v Vernons Pools (1938)- ‘In honour only’

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Business connections restraint of trade case law

Home counties dairies v Skilton (1970): Fair if to protect from poaching customers, not to restrict making earnings

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Business efficacy implied term case law

The Moorcock (1889, CA)- Where an implied term is obvious, it should be implied

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51

Bystander negligence liability case law

Stennett v Hancock (1939): If bystanders injured by product, can claim

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52

CA 2006 (s.994) requirements

must be a member of the company, must have evidence that the company’s affairs have previously been unfairly prejudicial to members’ interests, must have evidence that a proposed act or omission would be likewise

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53

CA 2006 (s.994) unfair prejudice case law example

Kohli v Lit and Others (2009): don’t unfairly prejudice shareholders

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54

Can be liable for both passing off and malicious falsehood if

parties are in competition (only necessary for passing off, not for malicious falsehood

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Careless misrepresentation case law

Howard Marine & Dredging Co. Ltd v Ogden & Sons Ltd (1978, CA)

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Careless misrepresentation definition

representor could not reasonably have believed his statement to be true

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Careless misrepresentation remedy

sue under S.2(1) Misrepresentation Act 1967 and get damages and/or rescission (basically the same as fraudulent but easier to prove)

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Causation in fact test

But for test (Without breach, what would have happened?)

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59

Change of circumstances between statement and acceptance case law

With v O’Flanagan (1936, CA)- Should update the other party

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60

Checking truth of information case law

Redgrave v Hurd (1881)- Don’t have to check truth, even if invited to do so

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61

Children duty of care

Orchard v Lee (2009) Children held to lower standard

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62

Civil court order

County or High Court Court of appeal  Supreme court

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63

Civil name case order

claimant/plaintiff and defendant

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64

Coincidental performance case law

Bloom v American Swiss Watch Co (1915)- Coincidental performance isn’t binding (can’t accept an offer without knowing it exits)

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65

Collateral contracts case law

Shanklin Pier Ltd v Detel Products Ltd (1954)- Proximity may cause a collateral contract

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66

Collateral contracts

the performance of a contract between A and B may indirectly bring about another between A and C, so A can sue C and vice-versa

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67

Communicating acceptance to a third party case law

Powell v Lee (1908): Only effective is communicated to an authorised person (in this case, an agent, but that’s not 100% neccessary)

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68

Communication rule exception case law OBITER

Re Selectmove (1995): can waive if waived by both parties BUT ONLY OBITER, NOT BINDING PRECEDENT

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69

Company legal personality

Once registered, a company has its own legal personality distinct from its members. The company can be liable in Tort and Contract and for some criminal acts

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70

Company liability

unlimited liability. Members have limited liability for debts (to the value of their investment

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71

Company liable for criminal acts case law

R v Cotswold Geotechnical Holdings (2014) Companies can be liable for acts distinct from its members (here, corporate homicide)

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72

Company method of formation

Doesn’t exist until the registration procedures of the Companies Acts have been complied with

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73

Company secretary agency context case law

Panorama Developments v Fidelis Furnishing Fabrics (1971, CA): company liable where under secretary’s apparent authority

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74

Company secretary cannot

borrow money or make trading contracts

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75

Company secretary

principal administrative officer

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76

Company supervision

An LLC is monitored by the companies registrar through its annual return. Reports and accounts are open to public inspection. BIS has wide investigative powers and can send in investigators.

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77

Company termination

exists in perpetuity until wound up

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78

Company voluntary arrangement (CVA/IVA) definition

compromise with creditors which aims to avoid bankruptcy

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79

Comparator for discrimination

when bringing a case, victim chooses a comparator to claim that they would be treated differently if they had the same protected characteristics. Comparator can be hypothetical

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80

Compliance with ACAS grievance procedures failure

Unreasonable failure can increase damages by up to 25%

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81

Compulsory liquidation creditor requirements:

creditor is owed more than £750 and served a written demand for payment at its registered office, which has not been paid within 21 days

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Compulsory liquidation definition

petition to court by creditor or possibly a member

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83

Compulsory liquidation main statutory grounds (X2)

Company is unable to pay its debts (s122(1)(f) IA 1986) [for creditor], it is just and equitable to wind up the company (s122(1)(g) IA 1986) [member]

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84

Conditional offer acceptance

cannot be completed unless and until conditions are met

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85

Conditions for agency by ratification

Agent has actual authority, principal exist and has capacity to contract, reasonable timescale, ratification complete and communicated

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86

Conditions vs Warranties case law X2

Poussard v Spiers & Pond (1876), conditions as essential to the benefit of the contract/ Bettini v Gye (1876) warranty may change the benefit of the contract, but not fully deprive

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87

Conformity with accepted practice duty of care case law

Bolam v Friern Hospital Management Committee (1957, CA): If you can bring in expert witnesses who would agree with you, that’s a defense

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Consent defence free choice case law

Smith v Baker (1891): Must have a reasonable choice

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Consent to harm case law cf X2

Haynes v Harwood (1935, CA): moral duty to intervene, method was reasonable. Sylvester v Chapman (1935): moral duty, but not reasonable method, not enough care for own safety

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Consequence of creditors rejecting plan

goes back to the court, who can make any order it sees fit, e.g. terminating administrator

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Consequence of frustration

Contract ceases to exist from the point of discharge

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Consequences of administration

moratorium on winding the company up, fixed charge holders can’t enforce their security over property without the consent of the administrator or court, can’t seize leased assets without consent, can remove or appoint directors and employees, directors’ powers are suspended

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Consequences of agency by ratification

agent free of liability from acting without authority and can claim remuneration if appropriate, 3rd party obtains title to the goods, contract is retrospectively binding

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94

Consequences of agency from necessity

agent can claim expenses, agent has defence if sued for trespass, 3rd party gets good title to the goods

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Consequences of declaration of solvency without reasonable grounds consequence

criminal offence, punishable by fine or imprisonment

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96

Consequential loss case law

Muirhead v Industrial Tank Specialties Ltd (1986) Can claim for consequential loss, but not PEL without a special relationship

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97

Consideration definition case law

Currie v misa (1875)- Consideration requires a benefit and detriment on each side

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Consideration definition

Each party must give something in return for what is gained from the other party e.g.

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99

Consideration new obligation case law comparison X2

Collins v Godefroy (1831) Can’t use something you are already obliged to do as consideration/ Glasbrook bros v Glamorgan County Council (1925, HL)- If going beyond existing legal duty, it’s consideration

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100

Consideration rules

Must move from the promise, Must be sufficient, can be sufficient without being adequate, Usually involves taking on some new obligation (unless separate parties) and A subsequent promise of additional payment to encourage performance isn’t fresh consideration

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