Question 1

Which of the following reasons are valid justifications for the general adoption of the objective approach in contract law?
A) The objective approach promotes certainty.
B) The objective approach allows for a wider range of evidence to be admissible in court.
C) Courts are used to applying the objective approach and would be unable to change their approach.
D) None of the options provided is correct.

Accepted Answer

The objective approach in contract law is favored because it promotes certainty in contractual agreements, allowing parties to know precisely where they stand. This approach assesses a party's intention based on what a reasonable person would have understood the actions and words to mean, rather than trying to delve into the subjective state of mind of the parties involved.

Question 2

When will 'snapping up' an offer not lead to an enforceable contract?
A) Accepting an offer that was obviously made by mistake
B) Accepting an offer made by a consumer
C) Accepting an offer that has been individually negotiated.
D) None of the options given is correct.

Accepted Answer

Accepting an offer that was obviously made by mistake does not lead to an enforceable contract because for a contract to be valid, there must be a meeting of the minds between the parties, and a mistake indicates that such a consensus was not achieved.

Question 3

Why did the court in Raffles v Wichelhaus hold that there was no valid contract between the parties?
A) The ambiguity in the contract was the fault of neither party and each party had a different understanding of the agreement.
B) The contract failed to satisfy the requirement of formality.
C) The conduct of the parties would have led a reasonable person to believe that they did not intend to form a contract.
D) None of the options provided is correct.

Accepted Answer

The court held there was no valid contract due to a mutual mistake regarding the identity of the ship named "Peerless," leading to a fundamental misunderstanding between the parties about the contract's subject matter.

Question 4

Why was the defendant in Smith v Hughes not liable to pay the contract price for the new oats?
A) Old oats were discussed before the oral contract was concluded.
B) Old oats were not discussed but the seller knew that the buyer believed that the oats were in fact old.
C) The seller knew that the buyer was contracting for old oats.
D) All of the options provided are correct.

Accepted Answer

The seller knew that the buyer was contracting for old oats, and the seller did not correct the buyer's mistake.

Question 5

A signed contract will only be enforceable if it is established that both parties have actually read and understood its terms.

Accepted Answer

A signed contract is generally enforceable regardless of whether both parties have actually read and understood its terms, as signing indicates agreement to the contract's conditions.

Question 6

How are the words and conduct of a contracting party generally assessed?
A) By reference to a reasonable person in that party's own position
B) By reference to a reasonable person in the addressee's position
C) By reference to a reasonable person who is entirely detached from the proceedings
D) None of the options provided is correct.

Accepted Answer

The words and conduct of a contracting party are generally assessed by reference to a reasonable person in the addressee's position. This means understanding the contract terms and any communications from the perspective of a reasonable person in the position of the party receiving the information, not from the subjective viewpoint of the party providing it. This approach helps ensure objectivity in interpreting contractual obligations and communications.

Quiz 1: Objectivity in Contract Law

Which of the following reasons are valid justifications for the general adoption of the objective approach in contract law?

When will 'snapping up' an offer not lead to an enforceable contract?

Why did the court in Raffles v Wichelhaus hold that there was no valid contract between the parties?

Why was the defendant in Smith v Hughes not liable to pay the contract price for the new oats?

A signed contract will only be enforceable if it is established that both parties have actually read and understood its terms.

How are the words and conduct of a contracting party generally assessed?