21. Specific enforcement

This chapter looks at specific performance and injunctions. Specific enforcement is only available in limited circumstances. The adequacy of damages as a remedy must be addressed. Its availability is limited by issues of supervision and its general undesirability in relation to contracts for personal services. Its nature as an equitable remedy means that the courts have discretion and consideration is given to such matters as hardship, behaviour of the claimant, adequacy of consideration and mutuality.

19. The doctrine of frustration

This chapter investigates the scope of the doctrine of frustration which was developed to deal with cases where events occur after a contract is made which render the agreement illegal, or impossible to perform, or which fundamentally change the nature of the obligations undertaken by the parties. The doctrine operates within strict limits and its use is restricted in cases where, although the commercial purpose of the contract has been drastically affected by unforeseen events, the performance of the contract is still possible. The position under the Law Reform (Frustrated Contracts) Act 1943 and under the common law, including for example, the recent cases of Islamic Republic of Iran Shipping Lines v Steamship Mutual Underwriting Association (Bermuda) Ltd and Olympic Airlines SA (in Special Liquidation) v ACG Acquisition XX LLC, are examined, collectively demonstrating how the doctrine currently operates.

14. Duress and undue influence

This chapter looks at the effect of duress or undue influence on the making of a contract. The difficulty is identified of distinguishing hard bargaining from economic duress, when the ‘threat’ is to the economic interest of the party ‘threatened’. This raises the question of what amounts to an illegitimate threat; whether a threat which is not otherwise legally labelled as wrongful will suffice, and whether all threatened breaches of contract do so. The question also arises as to a test of a ‘reasonable’, or ‘practical’, alternative to agreeing. Undue influence is concerned with the surrender of decision making because of the relationship of the parties whether through domination or trust. The presumptions that arise in relation to undue influence, and when they arise, are examined. Consideration is given to the treatment of aggressive and misleading trade practices under the Consumer Protection from Unfair Trading Regulations (as amended by the Consumer Protection (Amendment) Regulations 2014).

10. Exemption clauses and legislation

This chapter deals with the statutory policing of exemption clauses under the Unfair Contract Terms Act 1977 (UCTA) and addresses the changes to the law made by the Consumer Rights Act 2015. It explains the structure of UCTA and how to use it. It considers the different types of situations in which exemption clauses fall within it, under different sections (eg s2 negligence, s3 written standard terms of business, s6 and s7 goods contracts), and the need to consider whether a section renders a clause automatically ineffective or subjects it to the requirement of reasonableness. It looks at the application of the requirement of reasonableness and factors which have been identified as significant, such as the potential for insurance, the availability of alternatives, and reasons for a level of limitation. It considers the meaning of the UCTA’s definition of ‘deals as consumer’.

7. Express and implied terms

This chapter looks at the creation of express and implied terms. In particular, it deals with spoken statements becoming express terms and the different types of implied terms. Terms implied in fact, in law, and by custom are addressed. The traditional ‘business efficacy test’, and ‘officious bystander test’ are looked at in relation to terms implied in fact, and the developments in Belize Telecom. Consideration is given to the requirements for terms to be implied in law, at common law, and the growing recognition that, despite references to ‘necessity’, the implication of such terms is concerned with issues of fairness, reasonableness, and social policy.

6. Intention to create legal relations

This chapter considers the final element of the formation of the contract: the intention to create legal relations. There is generally no difficulty in finding this requirement is fulfilled in commercial cases, but such intention is generally assumed to be absent in domestic or social agreements. The parties’ intentions may usually reflect these assumptions, but the issue of underlying policy is addressed. In commercial situations, issues of ‘intention to create legal relations’ are more likely to arise in relation to a clause which it is claimed is intended to show that there was no such intention in relation to the particular agreement.

3. Certainty and formalities

This chapter looks at the need for certainty and formalities in contracting. It explores case law which illustrates, on the one hand, that a willingness of the parties to make a contract does not necessarily amount to a legally binding agreement, whilst on the other hand, there is potential for the court to fill in any gaps to give effect to agreements. The issues surrounding an agreement which is expressed to be ‘subject to contract’ are explored in light of the recent Supreme Court case of RTS Flexible Systems Ltd. The reasons for when contract formalities may be required are also noted. There is also discussion of electronic contracting, in relation to the introduction of the Electronic Identification and Trust Services for Electronic Transactions Regulations (2016/696).

17. Privity and third party rights

This chapter describes privity of contract, explaining the development of the doctrine and the problems associated with its application. The scope and usage of the Contracts (Rights of Third Parties) Act 1999 is discussed. The tensions inherently created by the possible freedom of the contracting parties to vary or cancel a third party’s right under an agreement are highlighted. Circumventions of, and exceptions to, the doctrine are also addressed including limitations on the doctrine which may be brought about by an assignment of contractual rights and the doctrine of agency. Finally, the issues surrounding privity and the doctrine of consideration are noted.

15. Illegality

This chapter explores the illegality of contracts. Contracts which may fall within the scope of the restraint of trade doctrine are considered, including the Court of Appeal’s approach in Proactive Sports Management Ltd v Rooney. The chapter also looks at other reasons why a contract may be declared illegal or void at common law, such as grounds of public policy. Policy factors and the illegality defence are explored in light of recent case law and the Law Commission Final Report ‘The Illegality Defence’. Useful case law illustrations demonstrate how the courts have dealt with the issues surrounding illegality in a range of contexts, such as contracts to commit an unlawful act, contracts promoting sexual immorality, contracts prejudicial to the interests of the state, contracts prejudicial to the administration of justice and contracts promoting corruption in public life. The consequences and effects of impropriety and illegality are also looked at. The landmark case of Patel v Mirza [2016] UKSC 42, and its impact on the law, is also explored in this chapter.

13. Misrepresentation

This chapter looks at misrepresentation. It first identifies the requirements for a misrepresentation, and highlights the situations in which the courts are willing to find misrepresentations although prima facie there are only statements of opinion which are stated not to suffice in themselves. It considers the remedy of rescission, and when it will be barred. It looks at the different ways in which damages may be provided for misrepresentation: for fraudulent misrepresentation under the tort of deceit; for negligent misrepresentation under the tort of negligent misrepresentation; and for negligent misrepresentation under s2(1) of the Misrepresentation Act 1967. It looks at the different requirements for each type, which it will be advisable to use, and what will be covered by a damages remedy for misrepresentation. Consideration is also given to remedies for aggressive and misleading trade practices under the amended Consumer Protection from Unfair Trading Regulations. The chapter also now looks at the Consumer Rights Act 2015 and its impact on the law.