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Contract to note well the requisites of a Contract. These

are

(1) Form,

(2) Consideration,

(3) Offer and Acceptance,

(4) Capacity to Contract,

(5) Legality and Possibility, and

(6) Absence of Mistake, Misrepresentation, or Fraud.

In the event of any one of these elements being wanting, the agreement will be either

(a) Void, that is, not necessarily illegal but destitute of all legal effect, e.g.,

(1) Contracts opposed to public policy, e.g., involving

Maintenance and Champerty.

(2) Agreements to commit a crime or civil injury. (3) Agreements in aid of an illegal object.

(4) Agreements in undue restraint of trade.

(5) Trading with enemy aliens.

(6) Agreements offending against the Truck Acts, etc. (7) Agreements of an immoral character.

(8) Stock Exchange transactions not intended to result in legitimate business.

(9) Where the contract is based on misapprehension of facts by both parties.

(10) Gaming and wagering contracts.

(11) Contracts offending against Leeman's Act.
(12) Certain contracts with infants.

(b) Voidable, that is, it can be affirmed or repudiated at the option of one of the parties, e.g.,

(1) Partnership and shareholding contracts with infants, as well as other contracts with infants,

not void or binding.

(2) Lunatics' and drunken persons' contracts.

(3) Contracts induced by fraud, misrepresentation, undue influence, or duress.

(4) Contracts where there has been a mistake of fact by one of the parties.

(c) Unenforceable, that is to say, it may be a valid contract but it cannot be enforced in a court of law owing to non-compliance with some statute, e.g.,

(1) Contracts of Marine Insurance not evidenced by writing.

(2) Contracts enumerated in Section 4, Statute of Frauds, 1677, if not in writing and signed by the party to be charged or his agent,

(3) Acknowledgments of debts barred by the Statutes
of Limitation, unless given in writing.

(4) Debts barred by the Statutes of Limitation.
(5) Contracts for the sale of goods of £10 or upwards
unless the conditions of Section 4, Sale of Goods
Act, 1893, are complied with.

(6) Bills of Exchange, Notes, and Cheques, if not in
writing.

(7) Assignments of Copyright, unless made in writing. (8) Agreements limiting the liability of a Railway Company as Common Carrier, unless made in writing. Most of the above matters are considered in detail hereinafter.

FORM

As a rule (with a few exceptions mentioned hereinafter) no particular form is necessary to enter into a contract, except (1) that a deed must be in writing and under seal, and is sufficient in itself to give a right of action, and (2) that there must be consideration to support a simple contract in order to make it enforceable. What is required is the agreement of the two minds on the same point, that is, the consensus ad idem previously referred to. This may be set out in writing, or partly in writing and partly verbal, (h) or wholly verbal, or it may be implied from the conduct of the parties. In the cases where a special form is necessary it will be found that it must be in writing, either under hand or under seal, while sometimes a verbal contract, although good in itself, cannot be enforced by action unless it is evidenced by writing.

Contracts which must be entered into under Seal.

(1) Contracts made by Corporations (with many exceptions). (2) Gratuitous Promises.

(3) Contracts by which British Ships are transferred. (4) Conditional Bills of Sale.

(5) Contracts for sale of original Sculpture, together with the copyright in it.

(6) Conveyances of Land (which of course includes houses), Mortgages, and Leases for upwards of three years. (7) Usually, transfers of Shares in Joint Stock Companies.

Simple Contracts which must be in Writing but need not be Sealed.

(1) Bills of Exchange and Promissory Notes.

(h) See ante, p. 12.

(2) Contracts of Marine Insurance.

(3) Assignment of Copyright.

(4) An acknowledgment to take a debt out of the operation of the Statutes of Limitation.

(5) Agreement by an executor to answer damages out of his own estate.

(6) Guarantees.

(7) Agreements in consideration of Marriage.

(8) Contracts for sale of Lands, etc.

(9) Agreements not to be performed within a year.

(10) Agreements limiting the liability of a Railway Company as Common Carrier.

(11) Agreements to lend money for business purposes, or for taking a share of profits, without being a partner.

(12) Agreements for the sale of goods of £10 or over (unless fulfilling one of the other conditions laid down in the Sale of Goods Act, 1893).

Most of the above matters are considered more fully hereinafter. Many of these contracts would be good even though not in writing, but could not be enforced.

Contracts which, although valid, are unenforceable by Action unless in Writing.

It is provided by Section 4 of the Statute of Frauds, 1677, that

"No action shall be brought

(1) to charge any executor or administrator upon any special promise to answer damages out of his own estate, or

(2) to charge the defendant upon any special promise to answer for the debt, default, or miscarriage of another person, or

(3) to charge any person upon any agreement made upon consideration of marriage, or

(4) upon any contract or sale of lands, tenements, or hereditaments, or any interest in or concerning them, or

(5) upon any agreement that is not to be performed within the space of one year from the making thereof

Unless the agreement upon which such action shall be brought, or some memorandum or note thereof, shall be in writing, signed by the party to be charged therewith, or some other person thereunto by him lawfully authorised."

Formerly, by Section 17 of the Statute of Frauds-extended by Section 7 of Lord Tenterden's Act, 1828-and now by Section 4 of the Sale of Goods Act, 1893, it is provided that

"A contract for the sale of any goods of the value of ten pounds or upwards shall not be enforceable by action unless the buyer shall

accept part of the goods so sold, and actually receive the same, or give something in earnest to bind the contract or in part payment, or unless some note or memorandum in writing of the contract be made, and signed by the party to be charged, or his agent in that behalf.”

The existence of the contract is not affected by the above provisions, and it exists independently; but it is unenforceable by action unless evidenced in accordance with the conditions mentioned. The writing need not be made at the time when the contract is entered into, for as laid down in the case of Lucas v. Dixon (1889) it may be made at any time before action is commenced; but it may not be made after that time. Such writing need not necessarily be a document drawn up for the purpose of evidencing the particular contract; any document is sufficient that is signed by the party to be charged, or his agent, providing it contains sufficient reference to the terms of the contract. In the case of Re Hoyle, Hoyle v. Hoyle (1893) a recital in a will was held to be sufficient memorandum to satisfy the statute.

In spite of these provisions being observed, consideration is still required unless the contract be under seal (and for contracts in restraint of trade (i) even though under seal); and the writing must contain a statement of the consideration, if in fact a specific price has been agreed, or it must be capable of being implied therefrom (except in the case of guarantees, where the consideration, although it must exist, need not be stated).

How Memorandum in Writing may be effected.-The memorandum must be complete, that is to say, it must show the whole of the agreement-the names of the parties, the subject matter, and the consideration. It need not, however, be contained in one document, it can extend over several (e.g., a series of letters contained in correspondence) provided they form together a connected whole; but, if one of the signed papers cannot be connected with an unsigned paper without parol evidence, such evidence will not usually be permitted. Such at least was the rule laid down in Boydell v. Drummond (1809), where printed copies of a prospectus regarding a publication were lying on the counter of a shop, together with a book headed "Shakespeare Subscribers their signatures." A signed his name in the book, and the shopkeeper sought to make him liable on a contract to take a copy of the publication. It appeared that there was nothing in the book containing the signature which referred to the prospectus; nor vice versa. It was held that there was no binding contract, for the following reason: If there had been anything in the book which had referred to the particular

(i) See post, p. 41.

66

prospectus, that would have been sufficient; if the title to the book had been the same as the prospectus, it might perhaps have done; but as the signature now stands, without reference of any sort to the prospectus, there was nothing to prevent the plaintiff from substituting any prospectus, and saying that it was the prospectus exhibited in his shop at the time to which the signature related." But this strict rule has been somewhat relaxed, and parol evidence is now admitted to show the connection between two or more documents connected with the same contract, but not expressly referring to each other, although their mutual connection is clear. Thus, in Oliver v. Hunting (1890), C agreed to sell to D a freehold estate for £2,275, and signed a memorandum which referred to every essential except the actual property to be sold. D sent a cheque for the deposit, and C in replying said "I beg to acknowledge receipt of cheque on account of the purchase money for the Fletton estate." It was held that parol evidence could be admitted to explain the circumstances under which the letter was written. In this latter case there was a reference to another document in the letter, but in Boydell v. Drummond, cited above, it should be noted there was no obvious reference to another document. In the case of Pearce v. Gardner (1897), all the terms of the contract except the name of the person to whom it was addressed appeared in the document relied on, and the envelope in which it was sent was allowed to be put in evidence to show who the other party was. A letter written within the scope of his authority by an agent and referring to an unsigned document may be sufficient memorandum, although the agent was not authorized to sign it as a record of the contract. A letter containing a repudiation of liability was deemed sufficient memorandum in the case of Dewar v. Mintoft (1912). Oral evidence may be admitted to show the identity of documents, subject matter, and persons referred to in the writing. In Cave v. Hastings (1881), the term "our arrangement" was used, and this was admitted as showing connection with an arrangement set out in a previous letter.

"has

The names of the parties must be on the paper or, at any rate, the name of the party to be charged and a sufficient desscription of the other party. The term "vendor" has been held to be insufficient as a description, but "the proprietor been deemed sufficient where it was shown that only one proprietor was in existence, providing that evidence is produced to show the connection; and in Allen and Co., Ltd. v. Whiteman (1920) it was held that a statement that a named person is the husband of the vendor is sufficient, so also if it appears on the particulars of sale that property is being sold by order of

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