ADVOCATES FOR INTERNATIONALDEVELOPMENTBASICPRINCIPLES OFENGLISHCONTRACT LAWPrepared by lawyers fromALLEN OVERYwww.a4id.orgTABLE OF CONTENTSFORMATION OF A CONTRACTA.OFFERB.ACCEPTANCEC.CONSIDERATIOND.CONTRACTUAL INTENTIONE.FORMCONTENTS OF A CONTRACTA.EXPRESS TERMSB.IMPLIED TERMSTHE END OF A CONTRACT -EXPIRATION,TERMINATION,VITIATION,FRUSTRATIONAEXPIRATIONBTERMINATIONCVITIATIONDFRUSTRATIONVIDAMAGES REMEDIESBASIC PRINCIPLES OF ENGLISH CONTRACT LAWINTRODUCTIONThis Guide is arranged in the following parts:IFormation of a ContractIIContents of a ContractThe end of a ContractIFORMATION OF A CONTRACT1.A contract is an agreement giving rise to obligations which are enforced orrecognised by law.2.In common law,there are 3 basic essentials to the creation of a contract:(i)agreement;(ii)contractual intention;and (iii)consideration.3.The first requisite of a contract is that the parties should have reachedagreement.Generally speaking,an agreement is reached when one partymakes an offer,which is accepted by another party.In deciding whether theparties have reached agreement,the courts will apply an objective test.A.OFFER4.An offer is an expression of willingness to contract on specified terms,madewith the intention that it is to be binding once accepted by the person towhom it is addressed.1 There must be an objective manifestation of intent bythe offeror to be bound by the offer if accepted by the other party.Therefore,the offeror will be bound if his words or conduct are such as to induce areasonable third party observer to believe that he intends to be bound,evenif in fact he has no such intention.This was held to be the case where auniversity made an offer of a place to an intending student as a result of aclerical error.2An offer can be addressed to a single person,to a specified group of persons,or to the world at large.An example of the latter would be a reward poster forthe return of a lost pet.6.An offer may be made expressly (by words)or by conduct.7.An offer must be distinguished from an invitation to treat,by which a persondoes not make an offer but invites another party to do so.Whether astatement is an offer or an invitation to treat depends primarily on theintention with which it is made.An invitation to treat is not made with theintention that it is to be binding as soon as the person to whom it isaddressed communicates his assent to its terms.Common examples of1 Stover v Manchester City Council [1974]1 WLR 1403.2 Moran v University College Salford(No 2),The Times,November 23,1993.