What are the essential elements that must be present for a contract to be valid in Australia?

To form a valid contract in Australia, there must be a clear offer, accepted consideration, legal subject matter, and parties with intent and capacity. Misrepresentation, duress, or undue influence can affect it, and a breach may result in damages.

This article is inspired by the book “An Introduction to the Law of Contract” 9th Edition, by: Stephen Graw.

We are looking at the law in the present time rather than history or origin, the whole purpose is to get on some basics of Australian law.“Law defines rules of behaviour that a particular society acts collectively for its own self-governance.” (Graw, 2019) Australian law is formed from English law (origin 1788), contains two types;

  1. Enacted (written) Law
    Which is made by parliament to rule state and federal parliament (used by all legislative bodies), which is observed through our councils “known as STATUTE”. Enacted laws are obtained from – Constitution – Legislation – Subsidiary legislation
  2. Unenacted ( unwritten) Law
    These are law made by courts (through judges) without any parliament involvement “known as CASE LAW or PRECEDENT”. Unenacted laws are obtained from – Common Law – Equity Law

Australia got three major parts in law;

  1. Common Law – Which is truly common among particular societies in terms of customs, ethics, religion, and legislation. Because different societies see things differently and have different value systems, it is often the case that law differs from society to society. These common laws are not written formally; in fact, decisions and words of cases are documented in the law report of each case and based on them judge needs to extract common law rules as required, which means common law is continuously developing. In common law rule/terms are; – Uniform- Certainty- Fairness. Common law exhibits uniformity across system and society, ensuring “doctrine of precedent” decisions were consistent with treating person and situation. An appeal system is found in common law to ensure any improper decisions can be rectified.
  2. Equity – When things grew, some cases under common law suffered to establish fair decisions because of its inflexibility, giving growth to equity. Things beyond common law are handled by equity law as common law focuses on compensation for misconduct, where equity could also include remedies in particulars, specific performance, injunction, declaration, and rescission.
  3. Note: Mareva injunction is designed to prevent a person from taking property out of country to defeat any anticipated judgement.
  4. Both the common law and equity law is applied in the same court, and the judge decides the application based on remedies to make the decision fair.
  5. Statute – These are the law from parliament, both state and federal which form democracy. – Under parliament, legislative, federal power is minimal and need to co-exist with other states to make laws for the nation’s benefits. This determines that the law of each state shall have its own regulation and only people who reside locally in the respective state becomes subject to the law of that state. – Now, coming down to powers in legislative law.
  6. Concurrent legislative powers control and manage the business (tax, banking, insurances, etc.) and are shared between federal and state legislative bodies.
  7. Exclusive powers are related to national security and governance (as defence, customs, excise, etc.), and these are managed by federal parliament alone.

Overall all law play variety of roles but got few common principles,

  • As they reflect broader and wide collective community views on right and wrong.
  • Law is used as an instrument and sometimes a weapon used to control situations and change society.
  • The law penalises or punishes lawbreakers/breach among community standards.

Division of powers

Powers are divided into three independent bodies;

  1. Parliament or Legislative Power (who are lawmakers)
  2. Executive Power (who are law administrators, ministers, and public servants)
  3. Judicial Power (who interpret and apply laws, as judges and courts)

The doctrine of Precedent (DOP) applies to both common and equity law. The precedent is deciding the case, and its reasons/ing needs to be followed by other courts dealing with similar facts and situations, making decisions that force judges to make decisions based on early binding or authoritative precedent. Note: “Any decisions that are PRE INCURIAM which means judge fails to follow a binding precedent will normally be revised on appeal”. The doctrine of Precedent can be excluded when – there is no binding precedent – precedent exists, but distinct on its own facts – two or more precedents exist but differ in decisions

Court is defined as “a body of people presided over by a judge, judges, or magistrate, and acting as a tribunal in civil and criminal cases” (oxford dictionary, category; noun). The work of the court is to control, manage to apply the law in the country. The court hears evidence and witnesses from both parties and accordingly rules the decision. The official power of the court refers to case type, to make legal decisions and judgements based on hearing within limits of court’s authority (limits reference to the type of crime committed).

Local or Magistrate courts are at the lowest level in the state and deals with civil related activities and less serious criminal activities. Any parties dissatisfied with local court decisions can appeal to the District court.

District or County courts hear an appeal from the local court where the magistrate is unsure of question and district court advice based on law. The design of this court structure is to avoid unnecessary appeals.

The Supreme court is the highest in the state, and its decisions are made by a single judge or by full court (3-5 judges). Single judge exercises the court’s original jurisdiction, and the opinions make full-court decisions of the majority of judges who geared the appeal.

The high court is the national court that sits in most of the countries in the capital city as the Australian high court sits in Canberra. Decisions of this court are final in the legal system.

Federal court  – Refers to existing Australian colonies court system for federal law – Under Australian constitution  – A special court of justice “who is/are expert in the specialised field” is appointed for specific matters. Advantages are, minimising wait time, keep legal costs low, no need to follow strict court procedures and overall judges were able to understand dispute with greater technical depth than a regular judge in court. And these specialist tribunals are set by statute at the federal and state level. –  Competition Tribunal Cases are reviewed by ACCC. Permissions are granted by the Commission permitting conduct and arrangements. Consists of 3 members; a federal Court judge, an economist and an experienced business person.

State Courts –  Created under state constitutions –  Holds special matters:

Youth court (for youths under the age of 18 years) and The coroners court (for violent death cases)

Small Claims Tribunal Set for consumer cases (transactions outside a business). Heard from the referee and there are no rules to employ legal representatives. Disputes limited to $6000 (may vary from state to state).