Need to know where you stand in relation to a contract?
Need to enforce a contract?
Trying to get out of a contract?
Contracts and agreements are an integral part of our society. It's therefore not only important to understand how contracts are formed but also how they will be interpreted, terminated and enforced. We have extensive experience with contract formation, construction, disputes and litigation so if you need any help with contracts you can be confident we will be able to help.
Determining whether a contract has been formed involves considering whether:
- there has been any offer and acceptance;
- there were any conditions required to be satisfied before the contract can be considered to have been formed;
- there has been proper consideration given by the parties;
- the parties intended to be legally bound;
- promissory estoppel will prevent the formation of an agreement; and
- the formalities of contract formation have been complied with (e.g. was the agreement required to be in writing?)
After establishing a binding contract does exist the next step in any contract dispute is to determine what the actual terms of the contract are. This can be a hard task for the unexperienced. There are many overlaying factors, rules and principals which effect the ultimate interpretation and construction of contracts. These include:
- How was the contract formed? - (i.e. in writing, conduct, orally, or a combination of those?)
- Are any of the parties prevented (or estopped) from taking action under the contract?
- What are the terms of the contract and will any other documents or evidence be considered to interpret the terms of the contract?
- Are there any terms implied into the contract by:
- the facts to give efficacy to the agreement;
- law to give effect to the proper intention of the parties;
- custom or practice;
- implied intention (i.e. if the parties had have considered the issue what terms would have been included); and
- by legislation.
The courts have demonstrated they will try to give effect to the bargain and not to deny its efficacy by a restrictive technical analysis by:
- when determining the meaning or legal effect of a particular term, they have construed the whole contract, including any implied terms;
- presuming the parties did not intend the terms of the contract to operate unreasonably;
- taking a common sense approach where possible;
- remembering contract law is often concerned more with the legal effect of a contract term rather than linguistic meaning;
- applying rules which have developed to govern the forensic material (e.g. documents) which can be referred to to assist in the construction process; and
- taking into account the surrounding circumstances in determining the meaning where appropriate.
Have there been any vitiating factors which would effect the formation or enforcement of the contract. This includes an analysis of whether there have been such things as:
- Undue Influence;
- Unconscionable Conduct;
- Illegality; and
- Limitation of action considerations.
Termination and Breach
Only after considering the factors raised above will you be able to determine whether there has been a proper termination or breach of a contract. There are too many ways an agreement can be terminated or breached which can really be considered here as each matter will turn on their own facts. All we can really say is that, if you have doubts or problems with an agreement or contract, it's important to seek advice from an experienced professional to go through all of the issues raised above to help you determine where you stand.
The remedies available to an innocent party to a breach of contract will depend upon the facts however they typically include:
- Recovery of Sums fixed by the contract;
- Restitution and unjust enrichment;
- Orders for specific performance against the breaching party; and
- Injunctions where appropriate.
[contact-form-7 id="130" title="Contact form 1"]