formalities and certainty

Question 1

formalism

Answer 1

rule orientated approach- the rules matter

achieves certainty and predictability of rules

may lead to unjust or absurd results

Question 2

realism

Answer 2

result orientated approach- the outcome matters

achieves outcomes more in line with parties expectations

may produce uncertanity

Question 3

Formalities

Answer 3

Most contracts are not required to be in any particular form
Oral agreements can be binding, although raise difficulties of proof
S9me contracts are required to be in writing under statue for example:

Contracts of guarantee
Contracts for sale/disposition of interest in land
Consumer credit agreements

Question 4

Certainty in terms

Answer 4

Terms must be sufficiently certain for a contract to be enforced by law (although implied terms may differ)

The reason:
Reluctance to create a contract for parties (freedom of contract)
Reluctance to encourage litigation

Problem- parties often start work without having agreed all the terms under which work will be done (RTS v Muller)
They may try to get around this by using short term contractual measures such as letters of intent
Or by reaching an agreement to negotiate or agreement to agree outstanding matters at a later date

Question 5

The market ideology (market individualism)

Answer 5

The function of contract is to facilitate competitive exchange
The certainty of transactions is to be promoted
Contract law should avoid market inconvenience

Question 6

The individualistic ideology: freedom of contract/ sancity of contract
(Market individualism)

Answer 6

Term freedom
Partner freedom
Sanctity of contract
The regulation of contracts should be minimal

Question 7

Consumer welfarism

Answer 7

Considerations of fairness and reasonableness

Consumer contracts are to be closely regulated
Commercial contracts, although still ordinary to be viewed as competitive transactions, are to be subject to rather more regi,action than market individualism would allow