Contract Law Assignment: Case Study Analysis and Discussion

This assignment analyzes two contract law case studies. The first case examines the formation of a unilateral contract through an advertisement offering a reward for catching a tagged fish. It explores the concepts of offer, acceptance, and revocation, concluding that no contract was formed due to the offeree's lack of knowledge of the offer and the offeror's subsequent revocation. The second case delves into contract modification and consideration, specifically addressing a situation where a party attempts to pay a reduced sum to settle a debt. It examines the validity of the varied contract and the applicability of the part performance doctrine, ultimately determining that the modified agreement lacks valid consideration and is unenforceable, while the original debt remains due. The analysis references key legal principles and case precedents, including Carlill v Carbolic Smoke Ball Company, Felthouse v Bindley, and Foakes v Beer.

Running head: CONTRACT LAW
CONTRACT LAW
Name of the Student:
Name of the University:
Author Note:

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Answer 1:
Issue:
The issue here is to analyze the rights pertaining to the parties in the contract.
Laws:
Contract is an agreement which binds a party to it legally and when all the elements of
the contract are present in a valid way it can be enforced by the courts of law (Eldridge 2019).
The essential elements of any contract are agreement consisting of offer and acceptance,
consideration as well as intension. Every contract is initiated when a party makes an offer to
another by showing that he is intended to create a contract (Beale et al. 2019). Offer refers to the
willingness of the party to bind himself with the terms of the contract with other party as laid in
Carlill v Carbolic Smoke Ball Company [1892] EWCA 1, [1893] 1 QB 256. The person who
proposes to initiate a contract is known as the offeror while the person to whom such offer is
made is called the offeree.
But, in this regard it has to be mentioned that offer is not same as the invitation to offer
where the latter indicates a statement of a party by means of which he is inviting others in
general to take a step and make an offer which can be accepted by him thus resulting into
formation of a new contract as seen in Pharmaceutical Society of GB v Boots Cash Chemists
(Southern) Ltd [1956] EWCA 6, [1953] 1 QB 401.
In the contracts law when an advertisement is made together with conditional reward an
offer is said to be made though it looks similar to an invitation to offer (Poole 2016). The case is
similar also for an advertisement which is made online. In that situation too, such advertisement

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amounts to an offer. This can be supported by the case law of Carlill v Carbolic Smoke Ball
Company [1892] EWCA 1, [1893] 1 QB 256 where it is observed that an advertisement together
with guarantee preventing a puff, is considered to be an offer . Similarly in the case of Peter
Smythe v. Vincent Thomas [2007] NSWSC 844, it appears that when an online advertisement is
made it is said to be an offer provided it has some condition embedded in it .
A unilateral contract is form of contract where an offer is made by the offeror such that
the offer can be accepted when it is performed in a way by the offeree as mentioned in the offer.
An advertisement that shows that it has an embedded condition that requires being performed
amounts to an unilateral contract. This can be construed in the judgment provided in the case of
Brogden v Metropolitan Railway Company L.R. 2 App. Cas. 666.
A valid contract is created when the acceptance of the offer results unconditionally.
Acceptance occurs when the offer made to the offeree is accepted by him as per the terms and
conditions given by the offerer (O'Sullivan 2018). The acceptance has to be communicated to the
offerer otherwise no agreement will result. This is seen in the judgment provided by the high
court of England and Wales in the case of Felthouse v Bindley [1862] EWHC J35.
An offerer has an option to revoke the offer made by him so that it cannot be accepted by
anyone this is called the revocation. If an offerer wants to revoke the offer made by him such
revocation has to be done prior to its acceptance. However the offerer has a responsibility to
communicate that he has revoked the offer. Revocation was discussed clearly in the case of
Cooke v Oxley (1790) 3 TR 653, 100 ER 785.

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Application
The facts of the case reveal that Buster wants to promote his business of fishing for which
he made an advertisement in the local newspaper. This advertisement given by Buster will be
recorded as an offer instead of invitation to offer. The reason behind it is that in the
advertisement given by Buster a condition of granting an award of amount $10,000 is provided if
anyone can cause the fulfillment of condition by catching a tagged cod fish of 20kg. Hence it is
an offer which can be supported by the judgment given in the Carlill v Carbolic Smoke Ball
Company case where it has been explicitly said that any advertisement made with a reward will
be regarded as an offer. Moreover it also results into a unilateral contract when the offer made by
Buster will be e accepted by fulfilling the condition as laid in Weatherby v Banham (1832) 172
E.R. 950.
In the case it is seen Tommy did not have any idea about the advertisement given by
Buster. Without having knowledge of it he catches the tagged 20kg codfish. The fact that he was
not aware of the advertisement will cause the non-acceptance of the offer. Moreover in order to
form an agreement, the acceptance of the offer has to be communicated to the offerer by the
offeree. Hence considering these facts it can be said that no contract was formed between
Tommy and Buster. Hence in spite of fulfilling the condition provided in the advertisement he
cannot claim the $10,000 reward because there was no contract. This can be supported by the
case law Felthouse v Bindley.
However when Buster sends a sms to Tommy that he wants to revoke the offer, this
results into revocation of the offer made by him in a valid way. This is because the revocation
was made by Buster before the offeree, Tommy can accept the offer. Moreover the
communication of the revocation was also made to the offeree in the valid way. So the offer

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ceases to exist for Tommy. Hence Tommy in future also will be not allowed to accept the offer
as it stands revoked for him.
Therefore Tommy has no right to cause the enforcement of the contract against Buster.
Conclusion:
A quick perusal of the rules of contract discussed above together with its application on
the facts of the present case shows that no legal right is possessed by Tommy against Buster.
Answers 2
Issues
Issue here involves the analysis of the rights pertaining to the parties involved in the
contract. Another issue which requires to be analyzed in this part is whether the parties' rights get
modified if Tommy was told by Buster that he can pay the remaining debt by means of a lump
sum payment.
Law
A contract can be regarded as an agreement which is legally enforceable and such legally
enforceable contract is binding upon the parties involved in such contract (Poole 2016). To result
into the formation of a valid contract, all its elements of agreement together with intention and
consideration. The initiation of a contract occurs when any party called the offerer makes a
proposal which shows that he has intention to create a contract with other person. This is
pertaining to the decision of the court in the Carlill v Carbolic Smoke Ball Company [1892]
EWCA 1. The person to whom the offer is made is called the offeree.

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A valid agreement is formed when acceptance of the offer is made in a proper way
(O'Sullivan 2018). When it is communicated by the offeree that he has accepted the offer made
to him, it results into an agreement. A valid acceptance occurs when the acceptance is
communicated to the offerer and the acceptance is unconditional as seen in Felthouse v Bindley
[1862] EWHC J35.
Second element of contract is the presence of consideration. An agreement supported by
a valid consideration results into formation of a contract as laid down in the case of Woolworths
Ltd v Kelly (1991) 22 NSWLR 189. However if a party who has the duty to pay the consideration
fails to pay it he will be liable for the breach of the contract.
Moreover it is seen that a debt can amount to a consideration if paid full this is given in
the Pinnel’s Case (1602) 5 Co Rep 117a. It is held in this case that debt if paid in part will not
amount to a valid consideration. To explain this, an illustration can be given. For example, a
contract is formed by one party such that he will be buying the car of another by making
payment of $5000 as the consideration. After few days the offerer offers to pay only $3,500
although he is bound to pay $5000 as per the Contract. The offeree agrees to receive $3,500 and
makes a promise that he will not be asking for the remaining amount of money. Following the
principle enumerated in the Pinnel’s case, such a promise made by the offeree cannot be
enforced and thus the offeree again can claim the remaining amount irrespective of the promise
made by him . This was laid down in the part performance doctrine given in Jorden v Money
[1854] 10 ER 868.

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Moreover it was held in the Pinnel’s Case, that if any additional modification is made in
the contract terms by the offeree with the consent of the offerer, a valid consideration results and
it is binding on the parties.
Application
As per the facts of the case it appears that Tommy was given an offer to appear in TV for
10,000$ by Buster. This is a valid offer which was accepted by Tommy resulting into the
formation of a valid contract between them. Such contract is not only binding on the parties but
also can be legally enforced. The consideration fixed is $10,000.
But due to financial difficulties Bradley could not pay more than 3000 dollars. In order to
make a compromise Tommy told Buster, “if you make one further and final payment of $2,000, I
will be willing to forgive the remaining $5,000 of the debt”.
In response of this, Buster paid him $2,000 as per the new varied contract. However this
is not valid as there is lies no consideration. This can be supported by the case law of Roscorla v
Thomas [1842] EWHC J74. According to the original contract executed initially Bradley has a
duty to pay the remaining amount of money to Tommy. As the new variant contract has no
validity the parties do not have any right against each other for this. So, is not entitled to claim
$5000 won by Brady in the pub.
If it was told by Tommy that Buster can later on pay the remaining sum of money as
lump sum amount then the part performance doctrine will be applicable. In such case the debt
will not be discharged. In addition, Tommy is entitled to claim the leftover $5,000 as per the
illustration made above. This is pertaining to the judgment made in the case of Foakes v Beer
[1883] UKHL 1 All ER Rep 106.

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Conclusion
A quick perusal of the rules of contract discussed above together with its application on
the facts of the present case, it can be inferred that the parties do not possess any right as per the
new varied terms of the contract. But if it was asked by Tommy to cause a payment in a lump
sum amount against remaining money he can again claim remaining $5000 from him.

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References
Beale, H., Fauvarque-Cosson, B., Rutgers, J. and Vogenauer, S., 2019. Cases, materials and text
on contract law. Bloomsbury Publishing
Brogden v Metropolitan Railway Company L.R. 2 App. Cas. 666.
Carlill v Carbolic Smoke Ball Company [1892] EWCA 1, [1893] 1 QB 256
Cooke v Oxley (1790) 3 TR 653, 100 ER 785
Eldridge, J.A., 2019. Codifying Contract Law in Australia: Issues and Obstacles (Doctoral
dissertation)
Felthouse v Bindley [1862] EWHC J35.
Foakes v Beer [1883] UKHL 1 All ER Rep 106.
Jorden v Money [1854] 10 ER 868.
O'Sullivan, J., 2018. O'Sullivan and Hilliard's the Law of Contract. Oxford University Press.
Peter Smythe v. Vincent Thomas [2007] NSWSC 844
Pharmaceutical Society of GB v Boots Cash Chemists (Southern) Ltd [1956] EWCA 6, [1953] 1
QB 401
Pinnel’s Case (1602) 5 Co Rep 117a
Poole, J., 2016. Textbook on contract law. Oxford University Press.
Roscorla v Thomas [1842] EWHC J74

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Weatherby v Banham (1832) 172 E.R. 950
Woolworths Ltd v Kelly (1991) 22 NSWLR 189