This is an extract of our Incomplete And Vague Agreements document, which we sell as part of our GDL Contract Law Notes collection written by the top tier of Cambridge/Bpp/College Of Law students.
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INCOMPLETE AND VAGUE AGREEMENTS
The basic position
Viscount Dunedin (Hillas v Arcos): "As a matter of the general law of contract all the essentials have to be settled".
o Viscount Maugham, (Scammell v Ouston): "parties must so express themselves that their meaning can be determined with a reasonable degree of certainty"
Iain Macneil describes the attempts to extract coherent principles from these cases as 'a fool's errand.'
Incomplete: an incomplete contract is one which leaves the parties not agreed on some matter, or in disagreement over it, or still aiming to reach agreement over it in the future.
o Courts do not exist to force agreement.
Vague: a vague contract is one which raises a question of what it is that the parties have agreed.
o Courts will not write a contract for a party, but they will give effect to a valid bargain.
Conditional Agreements - binding pending the occurrence of the condition (e.g. a contract of insurance, in which the insurer's obligation to pay does not arise until loss is sustained by the insured)
Winn v Bull (1877) - Parties agreed in writing that the defendant would take a lease of a house from the plaintiff for a specified term at a specified rent "subject to the preparation and approval of a formal contract".
Held no contract to enforce.
Parties may settle majority of terms themselves but appoint solicitor to settle minor matters, may be bound. The rules of contract formation must take into account context.
o Deferred Agreements - "subject to contract" - courts'
presumption that binding legal relations are postponed until the conclusion of a formal agreement.
Chillingworth v Esche  - Sargant LJ: "it would require a very strong and exceptional case for this clear prima facie meaning [of subject to contract] to be displaced". What may look very like a contract can be prevented from binding by being made subject to the conclusion of a further contract.
Commercial benefit as this allows parties to communicate without being bound (e.g. 'without prejudice'). No intention to be bound.
Branca v Cobarro  - a short agreement provided that Branca would buy the lease of a mushroom farm from Cobarro, but ended with words
"provisional agreement" subject to solicitor creating a
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