In England and Scotland, law is derived from statute (law made in parliament) and case law (law made by judges). A statute is also called an Act of Parliament and has been the most common source of contract law.
How statute is created
A proposal come come from a government department or MP (Member of Parliament). A new proposal has to be drafted (or drawn up) in the most unambiguous language as possible. If a proposal originates from the former, it will be drafted by a civil service lawyer. Subject to a vote in the House of Commons, the proposal moves on to the next stage where The House of Lords debates the bill. The House of Lords will discuss the Bill and can suggest amendments. The Bill is then sent back to The House of Commons for consideration. The power of the House of Lords is limited and a Bill can become law even if they reject it. The House of Commons is an elected body whilst the House of Lords is not. The final stage is is when The monarch gives approval to a Bill. The final stage is only a formality.
Elements of a Contract
The basic elements of a contract are:
- Intention to create a legal relationship
- Offer
- Acceptance
- Consideration
Consideration
In the absence of consideration, there is no contract. Consideration is what the parties exchange under the contract, this can be money, goods or services.
Statute
Unfair Contract Terms Act 1977 ‘UCTA’
Under this Act, a term of a contract is void if deemed unfair whether signed or not.
Contracts (Rights of Third Parties) Act 1999
‘Act to make provisions for the enforcement of contractual terms by third parties’
Terms included in this Act:
‘Specific performance’ – An order form the court that obliges a party to do what they promised
‘Enforce a term’ – To make sure a term is obeyed
‘A third part to a contract’ – A person who has not signed a contract but may by affected by it
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How can acceptance be communicated?
Do you know any other statutes that ‘come into play’ in contracts?
What case law are you aware of?
Is there an equivalent of UCTA in your jurisdiction?
