Australian contract law - summary
November 15, 1994

A contract is an agreement between two or more parties that is legally enforceable. Each party aquires rights and duties in respect of the subject matter of the agreement. Contracts may be prepared under seal (eg. a will, power of attorney etc), or exist simply as a written or oral agreement.

For a contract to be formed there must be an intention to create legal relations, an agreement between the parties, and consideration shown by the parties. If either of these are missing, the contract is invalid.

Intent to create legal relations:

For an agreement to be reached there must be both offer and acceptance.

Rules of offer:

An invitation to treat is "hey, check this out" .. an ad, circular, vending machine, tender, displayed goods. An invitation to the consumer to come and make an offer. Non-directed, non-specific, non-personal.

Rules of termination of an offer:

Rules of acceptance:

Privity is the legal relationship that exists between the parties in a contract. Only parties privty to a contract incur rights and liabilities, thus only a party privy to the contract may sue on it. Other parties may be affected by the contract but without privity they have no case.