Francis Wallace, Partner

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Pre-Contractual Liability Presentation to
Eurojuris International Litigation Group Riga,
May 2007
presented by Francis Wallace, Partner
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• No general duty to negotiate in good faith
• But English law deals with practical problems
  arising in different ways

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• Requirements for formation of a valid contract
• Offer
• Acceptance
• Consideration money/something worth money
• Intention to create legal relations

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• Special types of contracts
• Sale of interests in land must be in writing
• Terms in one document or at least referred to in
  the main document
• S2 Law of Property (Miscellaneous Provisions) Act
  1989

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• Incomplete contracts
• Distinction between invitation to treat and offer
• Example Gibson v Manchester City Council 1979
  1 All ER 972

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• Conditional contracts
• No binding contract unless and until the
  condition is fulfilled

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• Letters of intent
• Sometimes no legal commitment
• Sometimes implied agreement that preliminary
  costs are payable where no contract is concluded
• Express agreement to pay preliminary costs

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• Quasi-Contract
• where the defendant has acquired a benefit from
  the Claimants act
• Where the defendant has acquired from a third
  party a benefit for which he must account to the
  claimant
• Where the defendant has acquired a benefit
  through his own wrongful act

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• Examples of quasi-contract claims
• money paid by the claimant to the defendants
  use e.g. Brooks Wharf v Goodman Bros 1936 3
  All ER 696
• Total failure of consideration e.g. Rowland v
  Divall 1923 2 KB 500
• Claims on a quantum meruit

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• Estoppel
• One person makes a clear and unambiguous
  representation, intending the other to act on it
• The other person relies on the representation to
  his detriment
• The person who made the representation is
  estopped or prevented from denying its truth

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• Estoppel
• Central London Property Trust Limited v High
  Trees House Limited 1947 KB 130
• Note estoppel can only be used as a defence and
  not as a right of action

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• Estoppel - Continued
• Use to support a claim to an interest in
  property Cobbe v Yeomans Row Management Limited
  2005 EWHC 266
• Note if discussions are subject to contract,
  this normally defeats an estoppel claim

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• Francis Wallace
• Rix Kay
• The Courtyard
• River Way
• Uckfield
• East Sussex TN22 3AA
• England
• Tel [phone]
• Fax [phone]
• Email FrancisWallace_at_rixandkay.co.uk