LA1040 October B3

CertHE COMMON LAW

LLB
BSc DEGREES WITH LAW
GradDip COMMERCIAL LAW

Contract law

Monday 11 October 2021

BLOCK 3 Available at: 15:00 UK time on Monday 11 October 2021

Submit before: 20:00 UK time on Monday 11 October 2021

You have FIVE HOURS in which to write your answers and upload them in the
required .doc or .docx format to the VLE. You are not expected to spend more
than FOUR HOURS writing your answers. The remaining hour is for
downloading, uploading, and to take short rest breaks.

You must answer FOUR of the following EIGHT questions. You must answer
all parts of a question unless otherwise stated.

The word limit for this examination is 4,500 words. Any words beyond this limit
will not be read by the examiners.

© University of London 2021

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1. Jemima wants to rent a room in her house and puts an advertisement in
the local newspaper stating that “it is guaranteed that the best offer
above £500 per month will secure the room”.

Anna and Beatrice visit the property on 1 st March. Anna is delighted by

the size of the room and its views across the park. As she is leaving the
house, she shouts out to Jemima that she “adores the room and wants
to offer her £550 per month”. Unfortunately, her words are drowned out
by the noisy traffic outside the house and Jemima does not hear.

Beatrice is undecided about the property and that afternoon sends

Jemima an email stating that if the rental payment includes electricity
usage she would consider paying £560. Jemima replies that electricity
is included in the monthly rental.

On 3rd March Claudia sees the advert and immediately sends Jemima
an email informing her that she will pay £10 more than the highest offer
Jemima receives. Jemima emails Claudia, informing her that the room
is hers for £570 per month.

Jemima has not yet noticed an email from Davinia that arrived in her
inbox on 2nd March. The email states, “I will take the room for £520.”

Advise the parties.

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2. Tempest Models is an agency that hires out models for photographic
work. On 1st January the agency enters two contracts:

(a) Andrew, the Editor of Funtime, a student magazine, agrees to hire

Beefy, a male model, for a two-hour photo shoot on 1st March for
£1,000;

(b) Charmain, who designs and sells dresses, agrees to hire Devi for
two weeks to model a new range of dresses at the London Dress
Fair from 1st May for £30,000.

The main source of income for Funtime is advertisements for events

placed by the London Student Union and which are notified to Andrew
each week. At a meeting on 1st February Andrew tells Erin, the new
President of the Student Union, about forthcoming issues of Funtime.
Erin is shocked to hear that Andrew intends to use a male model. Erin
informs Andrew that the Student Union disapproves of “the exploitation
of the human body for material gain” and that she will not authorise any
future advertisements. Andrew rings Tempest Models and says he
cannot afford the photo shoot. Tempest Models offer to reduce the fee
to £400 which Andrew accepts. The photo shoot is a great success and
Andrew has to print extra copies of the magazine.

Charmain’s dresses are very well received with many orders being
placed during the first week of the Fair. At the end of the first week,
Tempest Models demand an extra £5,000 for Devi’s services. Charmain
protests but since all other suitable models have been booked for the
show, she reluctantly agrees and Devi completes the show.

Andrew paid Tempest Models £400 but they now wish to claim the
balance of £600. Charmain has paid Tempest Models £30,000 and
refuses to pay any more.

Discuss.

3. ‘As a matter of principle, there should be no legal restrictions whatsoever

on the right of an innocent party to affirm a contract in the face of an
anticipatory breach.’

Do you agree with this statement? Explain your reasons.

4. ‘Section 64 of the Consumer Rights Act 2015 is reflective of a balance

drawn by the legislature between freedom of contract and consumer
protection. However, the courts have interpreted the provision in a way
that almost completely undermines the consumer protection objectives
of the legislation.’

Discuss.

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5. ‘Royal Bank of Scotland Plc v Etridge (No. 2) [2002] AC 773 tilts the
balance too far in favour of the lender and too far against the more
vulnerable guarantor. In doing so, it deprives the guarantor from the
protection that equity grants under the doctrine of unfair influence.’

Discuss.

6. ‘The law in relation to the impact that a common i.e. shared mistake has
upon a contract is difficult to state and even harder to justify.’

Discuss.

7. (a) Explain the operation of S 1(3) of the Law Reform (Frustrated

Contracts) Act 1943.

(b) On 1st August 2020 Woodenboats agree to build a yacht for

Naomi to be delivered on 1st August 2021. The contract specifies
that the hull must be made from Burma Teak. Woodenboats
explain that there is no stock of this timber in the UK and so they
will need to order it from Burma.

Advise Woodenboats if the contract is frustrated in the following

alternative circumstances:

(i) in September 2020 there are extensive forest fires in

Burma. As a result, the price of Burma Teak increases by
300%;

(ii) in October 2020 the UK government bans the importation

of any teak from Burma in order to preserve endangered
rainforest trees.

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8. Mohammad is the owner of a garden landscaping company and wants
to host a party for all his business contacts. He hopes that the party will
encourage one of his guests, Lucia, to hire him for the landscaping of all
the gardens in her many properties across London. Mohammad hires
Bilal, an events organiser, to arrange the party. Before signing the
contract with Bilal, Mohammad tells him that it is important that
everything is perfect if he is to stand the best chance of winning the
lucrative £1 million contract with Lucia. In preparation for the party,
Mohammad buys himself a new suit and shoes for £1,000.

One week before the party, Bilal gets a bad cold and tells Mohammad
that he can no longer organise the party. Mohammad contacts a local
events company in the hope that they can help but they tell him that it is
too short notice. Mohammad cancels the party. He demands that Bilal
pay him compensation for the distress caused from the cancelled party,
and his loss of reputation. He also demands that Bilal compensate him
for the lost profits from the £1 million contract that he has not secured
with Lucia, as well as the £1,000 he spent on the new suit and shoes.

Advise Bilal.

END OF PAPER

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