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UNIVERSITY OF LONDON LA1040 October

DIPLOMA IN LAW / CertHE COMMON LAW

DIPLOMA IN THE COMMON LAW
LLB
BSc DEGREES WITH LAW

Contract law

Thursday 20 October 2016: 10.00 – 13.15

Candidates will have THREE HOURS AND FIFTEEN MINUTES in which to

answer the questions.

Candidates should answer FOUR of the following EIGHT questions.

Candidates should answer all parts of a question unless otherwise stated.

Permitted materials
Students are permitted to bring into the examination room the following
specified document: one copy of Blackstone’s Statutes on Contract, Tort &
Restitution (OUP).

© University of London 2016

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1. Jodie meets Sabina in a pub and they start talking about cars. Sabina
boasts that she owns a Ferrari. Sabina asks Jodie if she wants to buy
her Ferrari. Jodie agrees to buy it for £50,000. Advise Jodie in each of
the following alternative circumstances:

(a) Unknown to Jodie and Sabina, Sabina’s Ferrari was destroyed

earlier when her garage burnt down.

(b) Jodie pays Sabina a £1,000 deposit in the pub and agrees for
the car to be delivered the next morning. That night Sabina’s
Ferrari is destroyed in a fire.

(c) Sabina and Jodie both think that Sabina’s Ferrari has a large 12
cylinder engine. In fact it has a less powerful six cylinder engine.

(d) Sabina owns two Ferraris. Sabina intended to offer her red one
for sale. Jodie thought that she was buying the yellow one.

(e) Sabina is convinced that her rich aunt has bought her a Ferrari
for her birthday which is the following day. In fact her aunt has
bought her a Maserati.

2. Claire owns two boats which she rents out to holidaymakers. In

January she enters the following contracts:

(a) To rent a luxury powerboat to Des Pot, a politician, from 2 - 15

July for £20,000.

(b) To rent a small fishing boat to Ivan Earing, a Professor of Law,

from 24 June - 8 July for £500.

In each case the payment is due on 1 June.

In March Des tells Claire that because his expense claims have been
rejected he cannot afford £20,000. Claire agrees to reduce the hire to
£10,000. In fact all his expense claims have been approved and paid.

Ivan also contacts Claire in March to say he now regrets booking a

holiday as he needs to buy some expensive books for his latest research
project. Claire feels sorry for him and reduces the rental to £250. Ivan is
delighted and buys the books he needs.

On 1 June Des pays Claire £10,000 and Ivan pays her £250.

Claire’s accountant tells her that she is running her business like a
charity and needs to ‘toughen up’. So on 1 July Claire tells Des and
Ivan that the balance of the original rents must now be paid.

Discuss the rights and remedies of the parties.

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3. (a) What is the difference between the rejection and the revocation
of a contractual offer? Illustrate your answer with relevant cases.

(b) On 1 February Eliza goes to a garage and tells Finchie the

salesman that, “she is thinking of selling her car and would want
want about £1,000 for it’’ and leaves her mobile number. On 2
February Finchie sends a text saying that there is little demand
for that model and all he can offer is £750. In the afternoon
Finchie receives an enthusiastic enquiry for the same model of
car. He remembers Eliza told him she worked in a café so he
goes round to see her. As he approaches her she says, “I didn’t
think I’d see you again after that pathetic offer.” Finchie
complains that Eliza has been rude and that he had come round
to accept her offer to sell the car for £1k. Eliza responds, “The
price is now £1,250 and I will assume you want it unless you tell
me different before tomorrow evening.” Finchie decides he
wants nothing more to do with Eliza and leaves. Two days later
Eliza calls into the garage to deliver the car and Finchie refuses
to buy it.

Advise Eliza.

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4. Dumbledore owns a castle which he rents out for special events. On 1
January he enters three contracts:

(1) With Professor Sprout to use the Drawing Room on 15 January

for a lunch to celebrate her growing the winning entry in last
year’s national Flesh Eating Plants Competition. The price is
agreed to be ‘£4,000 with £1,000 payable immediately and the
balance on the day’.

(2) With Madame Hooch to use the grounds for broomstick flying
lessons on 16 January at a cost of £500 payable immediately.

(3) With Hagrid for him to use ‘Ratkill’, a poison that

Dumbledore’s friend Professor Snape has devised to get rid of a
rat infestation at the castle before Professor Sprout’s lunch.
Hagrid declines payment but asks instead for two extra large
tankards he has seen in Dumbledore’s kitchen. Dumbledore
gives him one immediately and promises the other ‘after the job
is done’.

On 1 January Professor Sprout pays £1,000 and Madame

Hooch pays £500, to Dumbledore and Hagrid collects one large
tankard. By 10 January Dumbledore has spent £2,000 buying in
supplies for Professor Sprout’s lunch. On 11 January the
government make the use of Ratkill illegal and later that evening
Dumbledore’s castle is struck by lightning and burns down. The
fire brigade bring so many fire engines to try to control the fire
that the grounds are churned up and unsuitable for amateur
broom landings.

Advise Dumbledore as to his rights and liabilities arising from

the above events.

5. Critically evaluate TWO of the following statements:

(a) The principles that determine whether an unsigned document or

notice are incorporated into a contract have been manipulated
by judges in the past to protect individuals.

(b) The innominate term was an unnecessary invention.

(c) The definition of ‘necessaries’ in the context of minor’s contracts

is unclear and antiquated.

(d) The limits of the doctrine of ‘undue influence’ are very difficult to
state.

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6. Compare and contrast the principal remedies available for breach of
contract with those available for misrepresentation.

7. You are asked to write a brief introduction to the Good Restaurant

Guide describing customers’ rights and liabilities in restaurants. In
particular your introduction should contain answers to the following
questions:

(a) If someone cancels a table reservation are they liable for

anything?

(b) What standard should the food and service attain?

(c) If the meal and service falls below the required standard and a
customer initially refuses to pay, what are the customer’s rights
if subsequently she is induced to pay in the following
circumstances?:

(i) The owner tells the customer not to make a fuss and to
pay up or he will get his intimidating head chef, Arnie, to
‘beat the money out of her’.

(ii) The owner threatens to ban her from his restaurant (it is
the only one in the area) if she does not pay.

(iii) The head waiter refuses to return her coat unless she
pays the bill.

(d) If the meal and service fall below the required standard who
may bring an action if the table was booked for a party by one
person? (e.g. by a parent for a child’s birthday or by a Student
Law Society President for their Annual Dinner).

8. Describe and critically assess the success of the principal provisions

of the Contracts (Rights of Third Parties) Act 1999.

END OF PAPER

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