ACCA F4 A selection of popular cases

CONTRACT
Offer and acceptance Case Partridge v Crittenden Carlill v Carbolic Smoke Ball Co Fisher v Bell Pharmaceutical Society of GB v Boots Harvey v Facey Reminder Advert selling wild birds Newspaper ad Use smoke ball, catch flu, get 100 Flick knife in shop window Medicines on shop shelves Point of law Advert is an ITT not an offer Advert may be on offer to the world (rarely) Shop display an ITT not an offer. Display is an ITT. Point of sale is at counter Supply of information re selling price is not an offer Advert re auction was ITT to an offer hence no contract Unilateral offer could not be revoked while consideration was executory Counter offer revokes original offer

Lowest price for Bumper Hall Pen 900 Auction cancelled sued for expenses Father bought house for couple. Promised to transfer if they paid mortgage. Widow refused Sale of farm buyer tried to get price reduction Trying to buy a horse. Assume its mine if I dont hear from you Acceptance faxed from Amsterdam to London Acceptance and revocation letters crossing in post

Harris v Nickerson

Errington v Errington

Hyde v Wrench

Felthouse v Bindley

Silence cannot be acceptance

Entores v Miles Far Eastern Byrne v Van Tienhoven

Valid when received and read in London Revocation of offer only effective when received and read. Acceptance valid when posted.

Consideration Case Re McArdle Collins v Godefroy Reminder Tenant decorating house Witness promised money to give evidence already subpoenad Police requested to subdue picketing strikers Sailors mutinied others offered a rise to stay More sailors mutinied others offered a rise to stay Sub-contractor offered a bonus to finish on time Point of law Past consideration is no good No consideration promise was already legal obligation

Glasbrook Brothers v Glamorgan CC Stilk v Myrick

Police had done more than normal obligation consideration was supplied No consideration rise was not enforceable Extra duties were consideration rise was enforceable Avoidance of penalty for the main contractor was consideration for the bonus No consideration for variation of contract. Interest was due Promissory estoppel. Variation freely offered with no coercion could not go back on offer

Hartley v Ponsonby

Williams v Roffey Brothers

Foakes v Beer

Lender agreed delayed repayment schedule with no interest Landlord offered to reduce rent on high rise flats in WW2

Central London Property Trust v High Trees House

Intention Balfour v Balfour Husband went to Ceylon promised to support wife Domestic agreement presumed no intention to create legal relations Presumption in commercial contracts is that legal relations are intended but it can be rebutted.

Jones v Vernon Pools

Contract binding in honour only

Contract terms and exclusion clauses Poussard v Spiers & Pond Opera singer ill at start of run. Producers put in replacement Opera singer 3 days late for rehearsals Failing to attend was breach of condition gave right to rescind Attendance at all rehearsals was a warranty breach gives right to damages, not rescission Misrepresentation rendered the exclusion invalid

Bettini v Gye

Curtis v Chemical Cleaning Co

Employee said exclusion clause only applied to beads and sequins Rail ticket referred to standard conditions. They excluded liability for everything. Train too long for platform woman fell off Notice in hotel bedroom denied liability for loss Securicor night watchman set fire to building

Thompson v LMS Railway

Exclusion clause was adequately communicated

Olley v Marlborough Court Photo Productions v Securicor

Not effective communicated after contract was made Exclusion clause was effective

Misrepresentation Leaf v International Gallery Sale of fake Constable Mistake was not operative. Misrepresentation was innocent so rescission was only possible remedy. Sale was 5 years ago too late delay defeats equity

Performance Cutter v Powell Sailor died part way into journey. Captain refused to pay wages House part built. Builder went bust. Asked for quantum meruit No wages due part performance is no good

Sumpter v Hedges

No amount payable for building. Acceptance could not be freely given. Had to pay as performance substantially completed. Could deduct cost to finish to spec

Hoenig v Isaacs

House refurb largely completed but not exactly to spec. Homeowner refused to pay

Discharge by breach Sumpter v Hedges Builder half built house. Asked for part of price No quantum meruit as customer had no choice about accepting Immediate action for anticipatory breach was allowed Injured party can carry on regardless and sue for full price War frustrated contract. Lost right to sue

Hochster v de la Tour

Tour courier cancelled trip well in advance. Names on bins. Client cancelled order before work done

White and Carter (Councils) v McGregor Avery v Bowden

Shipping contract cancelled in advance. Wronged party opted to continue and sue for full price. War broke out Ship chartered out then sold before start of charter

Omnium DEnterprise v Sutherland

Anticipatory breach - not frustration. The events were avoidable by the owner Point of law Remoteness of damage not foreseeable couldnt sue.

Remedies for breach of contract Case Hadley v Baxendale Reminder Broken mill shaft. Delay in fixing lead to great loss of business Delay in completing contract led to huge cost from lost business Beauty contestant wrongly excluded from contest Loss much bigger than contract allowed for Contract proscribed fixed damages for trivial breaches Holiday not as good as described in brochure Contract stopped Bette Davis working for other film companies

Victoria Laundry v Newman Industries Chaplin v Hicks

Only liable for reasonably foreseeable damages

Difficult to assess damages but plaintiff still entitled Damages fixed at level proscribed in contract. Penalty clauses not upheld. Only sue for actual loss Could sue for disappointment and distress Injunction illustration

Cellulose Acetate Silk v Widnes Foundry Ford Motor Co v Armstrong Jarvis v Swan Tours

Warner Bros v Nelson

AGENCY
Watteau v Fenwick Pub manager ordered cigars despite specific orders not to. Pub owner refused to pay Lonely, unaccompanied horse in station. GNR arranged stabling. Owner refused to pay Promoters bought wine on behalf of company not yet formed. Implied agency. Owner bound on contract.

GNR v Swaffield

Agency by necessity. Owner had to pay.

Kelner v Baxter

Company not liable on contract as did not exist when contract made. Promoters personally liable Insanity ended agency. Solicitors liable for breach of warranty of authority.

Yonge v Toynbee

Solicitors acted for client who had gone insane.

TORT
Donoghue v Stevenson Decomposed snail in ginger beer. Great upset after drinking Duty of care despite no contract. Case established negligence.

Bourhill v Young

Woman heard crash looked out at No duty of care; too remote. messy accident miscarried Ad agency gets positive reference Negligent mis-statement. Liable if from banker of potential reasonably expect others to client. Client then goes rely on your statement bust owing money Caparo took over Fidelity relying Auditors normally only liable to on info in audited accounts. those to whom their These turned out to be in opinion is directly error communicated. Blind person falling down marked hole in road LEB negligent. Must take into account potential susceptibility. Fireman injured while dashing off Less care required if urgent to blaze. objective. Authority not liable One eyed mechanic no goggles Employer liable. More care supplied. Blinded by freak required given potential shard. seriousness Freak cricket shot hit ball out of ground injuring passer by. Club not liable. Highly unlikely accident.

Hedley Byrne v Heller

Caparo Inds v Dickman

Haley v LEB

Watt v Herts CC

Paris v Stepney BC

Bolton v Stone

ADT v Binder Hamlyn

Partner gave verbal assurance to Firm liable for negligent misbuyer that accounts were statement due to direct OK. Bought and lost comment. money. Explosive brothers. Willingly Volenti non fit injuria. Employer playing with explosives not liable. blown up

ICI v Shatwell

EMPLOYMENT
Pepper v Hart Teacher sent child to school at reduced fee. Revenue tried to assess benefit at average cost Cost in legislation interpreted as average cost. House of Lords used Hansard to help

Hall v Lorimer

Vision mixer worked for many employers for short time

Self employed

COMPANY
Salomon v Salomon Company financed by owner mainly by secured debt. Company insolvent. Owner claimed security Group company traded from premises owned by other group company. Compulsorily demolished Mechanics contract banned approaches to old customers after leaving job. Wrote out from new limited company instead 1916 contract between 2 British companies one with German shareholders. English company withdrew 2 shareholders (60%) expelled other shareholder as director Articles said disputes must go to arbitration. Shareholder sued company over dispute Articles allowed 1 vote per share up to max of 100. Large holder passed some shares to nominee. Chairman wouldnt count votes Articles said that selling shareholders must offer to directors who would buy at fair price. Allowed. Company separate legal person. Shareholder could also be secured creditor

DHN Food Distributors v Tower Hamlets

Compensation payable both for building and loss of trade. Whole group viewed as owner Not allowed. Company a sham merely to avoid contract obligation

Gilford Motor Co v Horne

Daimler v Continental Tyre and Rubber

No breach. Veil lifted to reveal other company as enemy

Ebrahimi v Westbourne Galleries Hickman v Kent Sheepbreeders

Court agreed just and equitable winding up as quasi partnership Articles binding on shareholder. Had to go to arbitration

Pender v Lushington

Articles binding on company. Had to count votes

Rayfield v Hands

Articles binding shareholder v shareholder. Directors obliged to buy

Eley v Positive Life

Articles said Eley Co solicitor for life. Sacked. Sued for breach Articles stated directors to be paid 1,000pa. Not paid Proposed change of articles to allow directors to buy out any shareholder Proposed change of articles to allow directors to buy out any shareholder competing with co 3 equal shareholder / directors. Articles said attacked director got treble votes. 2 tried to sack 3rd Director described himself as MD. Made contract. Co refused to pay. Co secretary hired cars claiming for co use. Used them personally. Co refused to pay Experienced accountant / director signed blank cheques. Colleague stole large sum. Shareholder selling. Directors bought knowing share price would rise soon Minority shareholders bringing action against director / majority shareholder who defrauded co

Articles dont make contracts between company and 3rd party. Could not sue Articles can be used to flesh out existing contract. 1,000 binding Not allowed. Not for benefit for company as whole

Re New British Iron

Dafen Tinplate v Llanelli Steel

Sidebottom v Kershaw Leese

Allowed. Although bad for 1 shareholder, would benefit co as a whole

Bushell v Faith

Couldnt sack him. Any vote would fail 2:3

Freeman & Lockyer v Buckhurst Park

Director held out as MD has apparent authority to bind co. Co must pay. Secretary has apparent authority to bind co in admin contracts. Co had to pay.

Panorama Developments v Fidelis Furnishings

Dorchester Finance v Stebbing

Liable for breach of duty to use skill and care. Accountant should have known better. Directors OK. Duty owed to co as whole not to individual shareholders They failed. If wrong is done to a co, the proper plaintiff is the co

Percival v Wright

Foss v Harbottle