Contract Law

Assume that the elements of intention and consideration required for the formation of a contract exist. Using the four-step process, discuss whether the element of agreement required for the formation of a contract can be established. Are Delicious Hamburgers obliged to provide Kyle and George each with a Mazda CX-7? (10 Marks)

Step 1- Identify the legal issue
The principle (or issue) of law is that in addition to intention and consideration part, there should be a component of agreement between the parties that is vital for a legally enforceable contract to be established.
Step 2- Explain the rule of law with reference to relevant authority.
There are three main requirements for the creation of a legally enforceable contract, which are

First, the acceptance must be on the same terms as the offer. Second, the acceptance must be made while the offer is still in existence. Third, the acceptance is made to the person whom the offer was addressed. Lastly, the acceptance is made in acceptable form.
First case is Placer Development Ltd v Commonwealth, the Commonwealth promises to pay subsidy to companies that import timber into Australia. The amount to be paid would be determined by the Commonwealth government from time to time. Originally the Commonwealth government paid the subsidy but stopped making the payment. Placer then enforce that the Commonwealth government must pay for the timber imported. However, the clause stating that the government would pay an unspecified amount is not enforceable. The court treats this as an illusory promise.
Second case is Partridge v Crittenden, in this case Partridge advertise on magazine stating “Bramble finch cock and hens, 25/-each.” He was sued by the Royal Society for the Prevention of Cruelty to Animals (RSPCA) for the statutory offence by offering wild birds for sale. The court decided that the advertisement did not amount to an offer, capable of acceptance to create a legally binding contract. Rather it was only an invitation to treat with interested buyers whom themselves offer to buy the advertised

Carbolic produced smoke balls as an effective prevention of influenza. They advertise that they would reward £100 to anyone that used the smoke ball but still caught influenza. The company represent its seriousness by putting £1000 to the bank account. However, after using the smoke ball Carlill caught influenza. Therefore, Carlill was seeking the reward. There were adequate circumstances from which it could be concluded that the promise was intended to be contractually binding. The act of purchasing the smoke balls and getting influenza is viewed as “executed