A Contract Law is a formal or legally binding agreement. Though not every agreement is a contract, or is legally binding. There can also be a domestic agreement and much more…

Classification of Contract

Unilateral: A contract that one person has made on his own but involving many people. E.g. Carhill Vs. Carbolic Smoke Ball Co.

• Bilateral: A contract between two or more people.
• Express: A clear contract between the parties involved.
• Implied: A contract by implication.
• Simple: An oral contract and a contract in writing.
• Formal: A contract entered by deed. (Signed, sealed and delivered)

Offer

An offer is a definite undertaking with the expectation that it will become binding when the person accepts if he or she wants to. 

NOTE:

An offer must be clear.

An offer can be revoked before acceptance.

It’s an offer that becomes a contract when acceptance takes place.

One who makes the proposition is called an OFFEROR.

One who accepts the proposition is called an OFFERREE.

Elements of a Contract Law

• Offer.
• Acceptance.
• Consideration.
• Capacity (Must be of age and must be literate)
• Intention to create legal relations.

Invitation to Treat.

Just like an offer, but there is an individual who invites someone else or so many people to treat. Examples, where such can occur, are;

• In a supermarket.
• Onboarding a bus.
• An auction sale.
• Through an advertisement.
• An invitation to tender.

Termination of an Offer

• By revocation.
• By rejection.
• Death of either party.
• Lapse of time.
• Counter-offer. (it varies the terms of an offer)

NB: Mere inquiry is not a counter-offer.

Acceptance

It is an unconditional assent to the terms of an offer. It occurs when the offeree agrees to the offer made by the offeror.

Rules of Acceptance

As long as contract law is concerned, the under-listed are the rules of acceptance.

• It must be unconditional or unqualified – It must not be a counter-offer.
• When the law or mode of acceptance is not stated, the offeree can accept by the means or medium the offeror uses to pass communication.
• Acceptance can be done by conduct
• Acceptance can be done by post and it is termed “accepted” once it is delivered at the post office.
• Silence does not constitute acceptance. E.g. Case of Felthouse vs. Bindley.

Consideration

It is something of value either monetary or non-monetary but could be something that benefits the parties to the contract and must not be illegal or impossible to perform.

Exemption Clauses

They are terms put in the contract to limit the liability of an individual either in full or incomplete and must be part of the contract.

Exemption clauses can be identified in a contract through the following ways…

• If it contains a document signed by the party complaining of it.
• In-operative exemption clause…
• When a party signs as a result of fraud.
• When the party seeking the exception clause has done beyond the agreement.
• When the fundamental term is been breached by the party seeking it.

Vitating Elements

It has to do with statements that drastically destroy or reduce the effectiveness of something or an agreement or contract which causes it to become faulty or makes it invalid.

Vitiating factors affecting a contract are:

• Mistakes.
• Misrepresentation.
• Duress.
• Undue influence.
• Illegality.

MISTAKES: They are categorized into 4 types namely; common mistakes, unilateral mistakes, mutual mistakes, and mistakes relating to identity.

• Common Mistakes: A mistake that both parties to the contract concluded under the same misapprehension about some facts which lie at the basis of the agreement.
• Unilateral Mistakes: A mistake where one party is mistaken, while the other party knowing fully of his partner’s mistake, still takes advantage.
• Mutual Mistakes: A misunderstanding between the parties entering into a contract as to the intention of the other party.
• Mistake Relating to Identity: If one party uses the identity of someone in forming the contract.

MISREPRESENTATION: It is a false statement that induces the other party to enter into the contracts or an agreement either by FRAUDULENT MISREPRESENTATION, NEGLIGENCE MISREPRESENTATION, AND INNOCENT MISREPRESENTATION.

• Fraudulent Misrepresentation, as defined by LordHerschell in DERRY V. PEEK 1889 is a false statement made knowingly, or without belief in its truth, or recklessly, or carelessly whether it is true or false.
• Negligent Misrepresentation is made carelessly, or without reasonable grounds for believing it to be true. Misrepresentation cannot be regarded as negligent and, therefore, giving rise to liability on the part of the representator unless he owes a duty of care to the representee.
• Innocent Misrepresentation is neither fraudulent nor negligent. It is made without any belief in its truth.