Contract
Contract law is one of the most heavily tested topics in FLK1. It covers the entire lifecycle of a contract: how it is formed, what terms it contains, when it can be avoided, how it can be discharged, and what remedies are available on breach. SQE1 questions often present client scenario problems requiring you to identify the issue and apply the rules precisely.
Practise Contract questions →What FLK1 tests in Contract
Formation: Offer and Acceptance
The distinction between offers and invitations to treat (shop displays, advertisements, tenders). Acceptance must be unequivocal and communicated. The postal rule (Adams v Lindsell). Counter-offers terminate the original offer (Hyde v Wrench). Revocation must be communicated before acceptance.
Consideration
Must be sufficient (has legal value) but need not be adequate (need not equal the benefit received). Consideration must not be past (Roscorla v Thomas). Performance of existing duty is not good consideration unless it confers a practical benefit (Williams v Roffey). Part-payment of a debt does not discharge the full debt (Pinnel's Case) unless promissory estoppel applies.
Terms: Express, Implied, and Exclusion Clauses
Conditions, warranties, and innominate terms — and the consequences of breach of each. Terms implied by statute (Sale of Goods Act, Consumer Rights Act). Terms implied in fact (The Moorcock, Liverpool City Council v Irwin). Exclusion clauses: incorporation (L'Estrange v Graucob), construction, and UCTA 1977 / CRA 2015 reasonableness/fairness.
Vitiating Factors
Misrepresentation (fraudulent, negligent under s.2(1) Misrepresentation Act 1967, innocent): remedies of rescission and/or damages. Mistake (common, mutual, unilateral): void or voidable depending on type. Duress and undue influence. Illegality.
Discharge: Breach and Frustration
Anticipatory breach entitles the innocent party to accept and sue immediately. The test for repudiatory breach. Frustration (Taylor v Caldwell): supervening impossibility, illegality, or radical change. The Law Reform (Frustrated Contracts) Act 1943 governs recovery of money paid.
Remedies
Damages: expectation loss (put in the position as if contract performed); reliance loss; restitution. Remoteness: losses must be within reasonable contemplation at the time of contracting (Hadley v Baxendale; Victoria Laundry). Duty to mitigate. Equitable remedies: specific performance (contracts for unique goods/land) and injunction.
Third Party Rights
Common law privity: only parties can sue. Contracts (Rights of Third Parties) Act 1999: a third party may enforce a term if the contract expressly so provides, or if the term purports to confer a benefit on them and they are identified by name, class or description.
Key cases
The cases most commonly tested in SQE1 MCQs for Contract.
An advertisement can be an offer if it is sufficiently specific and shows an intention to be bound.
Practical benefit to the promisor can constitute valid consideration for a promise to pay more.
Damages are limited to losses that arise naturally or were in the reasonable contemplation of both parties at contract date.
A contract may be frustrated when a thing essential to its performance is destroyed without the fault of either party.
A party is bound by the terms of a document they sign, even if they have not read it.
Exclusion clauses must be construed in context; there is no rule preventing exclusion of liability for fundamental breach.
Foundational case more relevant to Tort, but note the distinction from contractual liability (no contract between D and the manufacturer).
Other FLK1 topics
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