English Contract Law/Introduction

English Contract Law 100px|frameless'bitstream' #bb1b00 "+2" English Contract Law 2 Introduction 75px|frameless 250px|frameless|right 250px|frameless|right Contract Law is one of the central subjects that form the Law of England and Wales. It focusses on the rules for legally binding agreements and all types of contracts and parties. A thorough comprehension of the subject is essential because the principle of enforcing agreements is vital for the stability of society and has an impact on individuals and businesses, for example the use of basic contractual principles in other areas of law such as the supply of services, the sale of goods, and employment law. This book concentrates on the rules and factors which govern the formation, content, enforceability, and termination of a contract. Contract law has a long history, with major developments that took place during the nineteenth century, rooted in the principles of freedom of contract and laissez faire. Sources Contract law has three main sources: case law, legislation, regulations (often building on European Union law European Union directives), for example:Although the United Kingdom has commenced the process of withdrawing from the European Union, this book assumes that EU regulations and directives will continue to affect English contract law for the foreseeable future, at least until a Great Repeal Act is passed by Parliament. Carlill v Carbolic Smoke Ball Co [1893] 1 QB 256 CA the Unfair Contract Terms Act 1977 (UCTA) the Unfair Terms in Consumer Contracts Directive 1993 EU Directive 93/13 incorporated as the Unfair Terms in Consumer Contracts Regulations 1999 the Convention on the Law Applicable to Contractual Obligations 1980 Rome Convention 1980 the Rome I Regulation Rome 1 Regulation 593/2008 Elements A contract has five essential elements, which must all be present at the same time: Agreement Offer Acceptance Consideration Capacity Certainty Intention Agreement Agreement is a difficult element to define without giving examples. Consider the following types of agreements, some of which are legally enforceable and others are not: A tenancy agreement An agreement to meet for coffee A Loan loan agreement An agreement to share a car for travelling to and from work An agreement to enrol in an organization An agreement to purchase a new laptop computer How does the law determine the existence of an agreement? There are two general ways of approaching this question: subjective (the parties intentions) and objective (the outward evidence). The law follows the objective approach and looks at the outward evidence, rather than just what the parties were intending, because sometimes an agreement may not be apparent from their intentions alone. This approach was confirmed recently in RTS Flexible Systems Ltd v Molkerei Alois Müller GmbH & Co KG RTS Flexible Systems Ltd v Molkerei.[2010] UKSC Notes 25% __NOTOC__ __NOEDITSECTION__