Contract

Consequently, while all systems of contract law serve the same overarching purpose of enabling the creation of legally enforceable obligations, they may contain significant differences.

[14] Analogously, the transfer of debt, which was not accepted under Roman law, became widely practiced in medieval European commerce, owing largely to trade with the Muslim world during the Middle Ages.

In the majority of English-speaking countries, the rules are derived from English contract law which emerged as a result of precedents established by various courts in England over the centuries.

[35][36][37] An exception arises if the advertisement makes a unilateral promise, such as the offer of a reward, as in the case of Carlill v Carbolic Smoke Ball Co,[38] decided in nineteenth-century England.

[72] Warranties are generally viewed as primarily contract-based legal action, while negligent or fraudulent misrepresentations are tort-based, but there is a confusing mix of case law in the United States.

For instance, very small children may not be held to bargains they have made, on the assumption that they lack the maturity to understand what they are doing; errant employees or directors may be prevented from contracting for their company, because they have acted ultra vires (beyond their power).

[83] Specifics vary between jurisdictions, for example article 39 of the Philippine Civil Code provides a comprehensive overview of the most typical circumstances resulting in lost or diminished juridical capacity:[84] age, mental disability, the state of being a deaf-mute, penalty, absence,[e] insolvency, and trusteeship.

Implied terms are fully enforceable and, depending on the jurisdiction, may arise as a result of the conduct or expectations of the parties,[f] by virtue of custom (i.e. general unspoken norms within a particular industry), or by operation of law.

In addition, Australia, Israel and India imply a similar good faith term through laws while the Supreme Court of Canada has developed a doctrine of honest contractual performance.

Examples where reliance damages have been awarded because profits are too speculative include the Australian case of McRae v Commonwealth Disposals Commission[106] which concerned a contract for the rights to salvage a ship.

[150] Subject to the laws of the jurisdiction in which a challenge is brought, contracts may in certain circumstances be modified or terminated on the basis of hardship to the party seeking relief from contractual obligations.

The power of net positions lies in reducing credit exposure, and also offers regulatory capital requirement and settlement advantages, which contribute to market stability.

[157] Additionally, the code imposes an implied term that "the parties shall avoid wasting the resources, polluting the environment, or damaging the ecology in the course of performance of the contract".

In civil law jurisdictions, penalty clauses are permitted and seen to serve two purposes: deterring the obligee from defaulting on their obligations and providing predictable and guaranteed compensation for any breach of contract that takes place.

[167] Damages that may be awarded conform to the common law rules in Hadley v Baxendale[168] but it has been argued the test of foreseeability is substantially broader[169] and consequently more generous to the aggrieved party.

The cases of Benson v SA Mutual Life, Santos v Igesund and Haynes v King William's Town Municipality[173] set out guidelines to be taken into consideration where the court is asked to grant specific performance.

In general, the rules governing the formation of a contract under Québecois law are codified in Book Five, Title One, Chapter 2, Division 3 of the Civil Code.

Adopting the canonist position, all contracts were said to be an exchange of promises that were consensual and bonae fidei, that is, based simply on mutual assent and good faith.

Taking the Christian view that it is a sin to break one's promise, canon lawyers developed the pacta sunt servanda principle under which all serious agreements ought to be enforced, regardless of whether there had been compliance with strict formalities as prescribed by secular law.

[199] The civil code provides that a juridical act is only valid if it does not violate an imperative or prohibitive provision[200] or public policy,[201] and if it complies with legal requirements as to form.

[209] Consequently, the formation of a contract under mainland Chinese law is governed by the mutual assent principle but is subject to the additional criterion that a valid offer expressly state that it is irrevocable.

For example, under the Japanese Commercial Code, a merchant trader who receives an offer from a regular client that falls within one of their areas of business is expected to respond without undue delay and, if they fail to do so, they are presumed to have accepted the contract.

Additionally, reformation may be sought where the defect in the document is caused by "ignorance, lack of skill, negligence, or bad faith on the part of the person drafting the instrument".

[265] Under the CISG, an offer to contract must be addressed to a person, be sufficiently definite – that is, describe the goods, quantity, and price – and indicate an intention for the offeror to be bound on acceptance.

[266] The CISG does not appear to recognise common law unilateral contracts[267] but, subject to clear indication by the offeror, treats any proposal not addressed to a specific person as only an invitation to make an offer.

For example, except in Singapore,[296][297] disputes regarding validity of registered IP rights may need to be resolved by a public body within the national registration system.

[304] Presently, Singapore maintains two distinct frameworks under which contractual disputes can be arbitrated, which differ primarily in regard to the extent to which parties to the proceedings may resort to the courts.

In Emirates Trading Agency Llc v Prime Mineral Exports Private Ltd., an obligation relating to "friendly discussion" acting as the first stage of an agreed approach to resolving disputes was upheld as enforceable.

[334] Improvidence must be measured with reference to the time of the contract's formation and involves a contextual assessment of "whether the potential for undue advantage or disadvantage created by the inequality of bargaining power has been realised".

The CIV establishes terms governing the transport of passengers, along with any accompanying articles (hand luggage, registered baggage, vehicles and trailers) and live animals.