FE-1 Contract Law

Question 1

What are the essential elements for the formation of a binding contract under Irish law?

Accepted Answer

Offer, acceptance, consideration, intention to create legal relations, and certainty of terms

Answer

A valid contract requires: a definite offer, an unequivocal acceptance, consideration (something of value exchanged), intention of the parties to be legally bound, and terms sufficiently certain to be enforced.

Question 2

In Irish contract law, what is the postal rule as established in Adams v Lindsell (1818)?

Accepted Answer

Acceptance of an offer sent by post takes effect when the letter is posted, not when it is received by the offeror

Answer

The postal rule provides that acceptance is complete the moment a correctly addressed, properly stamped letter is posted. This means the contract is formed before the offeror knows of the acceptance. The rule can be excluded by the terms of the offer.

Question 3

What is the legal effect of a counter-offer in contract law?

Accepted Answer

A counter-offer terminates the original offer — it cannot be revived unless the original offeror makes a new offer

Answer

As established in Hyde v Wrench [1840], a counter-offer constitutes a rejection of the original offer and replaces it with a new offer. The original offer is destroyed and cannot be accepted unless the original offeror repeats it.

Question 4

Under Irish law, what is the doctrine of promissory estoppel and its leading Irish authority?

Accepted Answer

Where a party makes a clear and unequivocal promise that the other party relies on to their detriment, equity may prevent the promisor from strictly enforcing their legal rights — Central London Property Trust v High Trees [1947] adopted in Ireland

Answer

Promissory estoppel, developed by Denning J in High Trees and applied in Ireland, prevents a party who has made a clear promise from going back on it where the other party has relied on it. In Ireland, following Combe v Combe, it operates as a shield, not a sword.

Question 5

What is misrepresentation in Irish contract law and what are its main categories?

Accepted Answer

A false statement of fact (not law or opinion) made by one party to another that induces the other to enter the contract — categories are fraudulent, negligent, and innocent

Answer

Misrepresentation requires: a false statement of existing fact, made to the contracting party, which induces entry into the contract. The categories are fraudulent (Derry v Peek), negligent (Hedley Byrne/section 45 Sale of Goods Act), and innocent — each with different remedies.

FE-1 Practice Test

FE-1 Practice Test

FE-1 Contract Law