Featured image for Precedents and Landmark Contract Cases: Shaping Contract Law History

Precedents and Landmark Contract Cases: Shaping Contract Law History

Precedents and Landmark Contract Cases: Shaping Contract Law History

Contract law is a fundamental aspect of business transactions and legal agreements. It provides a framework for parties to enter into enforceable agreements and ensures that contractual obligations are upheld. Over the years, various contract cases have played a significant role in shaping contract law history. These landmark cases have set important precedents that continue to guide the interpretation and application of contract law today. In this article, we will explore some of the most influential contract cases and their lasting impact.

1. Carlill v. Carbolic Smoke Ball Company

The case of Carlill v. Carbolic Smoke Ball Company (1893) is a classic example of how a contract can be formed through an offer and acceptance. This case involved a company that advertised a product claiming to prevent influenza. Mrs. Carlill purchased the product and subsequently fell ill, even though she followed the instructions. When she sued the company for compensation, the court ruled in her favor, stating that the advertisement constituted a unilateral offer, and by using the product as directed, Mrs. Carlill had accepted the offer. This case established the principle that a unilateral offer can be accepted by performing the requested act.

SQE 1 Practice Mocks FLK1 FLK2

2. Hadley v. Baxendale

The case of Hadley v. Baxendale (1854) is significant for establishing the rules governing the recovery of damages for breach of contract. The court held that the defaulting party can only be liable for damages that were reasonably foreseeable at the time of contract formation. In this case, Baxendale, a carrier, failed to deliver a broken mill shaft within the agreed-upon timeframe, causing significant losses to the plaintiff’s business. However, the court ruled that Baxendale could not be held liable for losses that were not communicated to him at the time of contract formation. This case laid down the principle of foreseeability of damages, which is still applied in contract law today.

SRA SQE Exam Dates

3. Donoghue v. Stevenson

The case of Donoghue v. Stevenson (1932) is commonly known as the “snail in the bottle” case. This landmark case established the principles of negligence and duty of care in contract law. Mrs. Donoghue consumed a ginger beer that contained a decomposed snail and subsequently fell ill. She sued the manufacturer, arguing that they owed her a duty of care to ensure the safety of their product. The House of Lords ruled in her favor, holding that a duty of care is owed to consumers, even in the absence of a contractual relationship. This case marked a significant development in contract law by expanding the scope of liability beyond contractual obligations.

4. The Moorcock

The case of The Moorcock (1889) is significant for its contribution to the doctrine of implied terms in contract law. In this case, a ship ran aground due to a hidden sandbank at the harbor. The court held that there was an implied term in the contract between the parties that the ship should be able to safely dock at the harbor. This case established the principle that some terms may be implied into a contract based on the reasonable expectations of the parties, even if not explicitly stated in the agreement. The Moorcock case paved the way for the recognition of implied terms as an essential aspect of contract law.

SQE 2 Preparation Courses

5. Taylor v. Caldwell

The case of Taylor v. Caldwell (1863) is a landmark case that dealt with the doctrine of frustration in contract law. In this case, the defendant agreed to rent a music hall to the claimant for a series of concerts. However, before the first concert could take place, the music hall was destroyed by fire. The court held that the contract was frustrated by the destruction of the subject matter, making it impossible to perform. This case established the principle that unforeseen events beyond the control of the parties can discharge a contract, relieving them of their performance obligations.


These are just a few examples of the many precedents and landmark contract cases that have shaped contract law history. Each case has contributed to the development and evolution of contract law, establishing principles that continue to guide legal practitioners and courts in interpreting and applying contract law. Understanding these cases and their implications is essential for legal professionals and anyone involved in contract formation and enforcement.

If you are preparing for SQE exams, make sure to utilize resources like SQE 1 Practice Exam Questions and SQE 1 Practice Mocks FLK1 FLK2 to enhance your knowledge and familiarity with contract law principles.

For more information on SQE preparation courses and upcoming exam dates, visit SQE 1 Preparation Courses and SRA SQE Exam Dates.