Picture this. You are forty minutes into the FLK1 paper, the clock reads 4 hours 40 left, and a Single Best Answer question gives you a builder, a homeowner, a quote sent by email, and a slightly different price scribbled in reply. The question asks whether a binding contract exists. Four of the five options look plausible. Sound familiar? Contract Law produces exactly this kind of trap — the law itself is not hard, but the SRA writes facts that punish anyone who skims.
Contract is one of the seven FLK1 subjects on the road to your solicitor qualification, and it shows up far more often than its single-subject status suggests. It bleeds into Business Law, Tort and even Dispute Resolution. Master it properly and you give yourself a quiet advantage across the whole paper. Let me walk you through the spine of the subject the way I would with a student the week before the exam.
Formation: the four ingredients SQE1 tests every time
Every contract needs offer, acceptance, consideration and intention to create legal relations. The examiner rarely asks you to recite this. Instead, they hide a defect in one element and dare you to spot it.
Start with offer versus invitation to treat. Goods on a shelf are an invitation to treat (Pharmaceutical Society of Great Britain v Boots); the customer makes the offer at the till. An advertisement is usually an invitation too — except where it is a clear unilateral promise, as in Carlill v Carbolic Smoke Ball Co. That distinction decides who is bound and when.
Acceptance must be a mirror image of the offer. Add a new term and you have a counter-offer, which destroys the original (Hyde v Wrench). The postal rule still appears: acceptance by post takes effect on posting, not receipt (Adams v Lindsell), but only where post is a reasonable method and the rule is not displaced. For instantaneous communication the ordinary rule of receipt applies.
Consideration must be sufficient but need not be adequate. Performing an existing duty is generally not good consideration — unless you confer a practical benefit on the other party (Williams v Roffey Bros). Part payment of a debt does not discharge the whole (Foakes v Beer), subject to promissory estoppel as a shield. Watch the date in the facts: past consideration is no consideration.
Exam habit worth building: when a question asks "is there a contract?", check the four elements in order and stop at the first that fails. The correct answer almost always turns on that single broken link.
Terms and their relative weight in FLK1 questions
Once a contract exists, FLK1 loves to test what is actually inside it. Distinguish a term from a mere representation, and within the terms separate conditions, warranties and innominate terms — because that classification controls the remedy.
A condition goes to the root of the contract; breach allows the innocent party to terminate and claim damages. A warranty is minor; breach gives damages only. An innominate term is judged by the seriousness of the consequences when it is broken (Hong Kong Fir Shipping v Kawasaki). If the facts describe a trivial breach of an important-sounding clause, the innominate analysis is usually what the examiner wants.
Terms can also be implied — by statute, by custom, or to give business efficacy. For consumer contracts, remember the Consumer Rights Act 2015: goods must be of satisfactory quality, fit for purpose and as described, with a tiered set of remedies. For business-to-business sales the Sale of Goods Act 1979 still governs. Identifying whether the buyer is a consumer changes the whole answer, so read who the parties are before anything else.
Exemption clauses and unfair terms
Exclusion clauses are a favourite because they involve a clean two-stage test. First, is the clause incorporated and does it cover the breach on its proper construction? Second, does legislation strike it down?
Incorporation happens by signature, by reasonable notice given before or at the time of contracting, or by a consistent course of dealing. A clause on the back of a ticket handed over after payment may come too late. On construction, ambiguity is read against the party relying on the clause (the contra proferentem approach).
Then the controls. In business contracts the Unfair Contract Terms Act 1977 applies — liability for death or personal injury from negligence cannot be excluded at all, and many other exclusions must satisfy a reasonableness test. In consumer contracts the Consumer Rights Act 2015 governs fairness, and certain core protections simply cannot be excluded. Pin down which statute applies and half the question answers itself.
Vitiating factors: when a contract unravels
Even a properly formed contract can be set aside. The vitiating factors are a reliable source of harder SQE1 questions because the remedies differ.
- Misrepresentation — a false statement of fact that induces the contract. Categorise it as fraudulent, negligent or innocent, because that drives whether damages are available and how they are measured. Rescission is the primary remedy, subject to bars such as affirmation or lapse of time. The Misrepresentation Act 1967 is central here.
- Mistake — common, mutual or unilateral. Operative mistake renders a contract void, a higher bar than misrepresentation.
- Duress and undue influence — illegitimate pressure or the abuse of a relationship of trust make a contract voidable. Watch for guarantees signed by a spouse; the Etridge guidance on independent advice often features.
- Illegality — contracts to do something unlawful are generally unenforceable.
A quick word of caution. Candidates often confuse "void" and "voidable". Void means no contract ever existed; voidable means a valid contract stands until the innocent party chooses to rescind. SQE1 will reward you for using the right one.
Breach and remedies: where most marks are won or lost
Remedies are the most heavily examined corner of Contract, and the reasoning is mechanical once you know the steps. The default remedy is damages, designed to put the claimant in the position they would have occupied had the contract been performed — the expectation measure (Robinson v Harman).
Two limits dominate the questions. Remoteness: losses are recoverable only if they arise naturally or were within the parties' reasonable contemplation (Hadley v Baxendale). Mitigation: the claimant cannot recover losses they could reasonably have avoided. A well-drafted SBA question often plants a loss the claimant could easily have prevented — the trap is awarding it anyway.
Distinguish a genuine liquidated damages clause from an unenforceable penalty. Modern law asks whether the clause protects a legitimate interest and is proportionate (Cavendish Square v Makdessi), not the old "genuine pre-estimate" formula alone. Equitable remedies — specific performance and injunctions — are discretionary and unavailable where damages are adequate, which they usually are for ordinary goods.
Do not forget termination for breach and the role of frustration. A contract is frustrated when an outside event makes performance impossible or radically different, with the financial consequences governed by the Law Reform (Frustrated Contracts) Act 1943. Frustration is narrow; mere hardship or rising cost will not do.
A reliable answer template for any remedies question: identify the breach, classify the term, choose the remedy, then apply remoteness and mitigation. Run that sequence and you will rarely pick the distractor.
Three things to do this week
Stop re-reading notes and start testing yourself. Build a one-page map linking each topic to its leading case and statute, then cover it and rebuild from memory. Drill timed SBA questions in batches of ten, reviewing every wrong answer until you can articulate why the right option beats the second-best. And practise reading the facts twice before the answers once — most Contract errors are reading errors, not knowledge gaps. This discipline carries straight into SQE2, where the same principles reappear in drafting and analysis tasks.
Remember the bigger picture too. Contract sits inside FLK1, which pairs with FLK2 to make up the full SQE1 assessment — two papers of 180 Single Best Answer questions each, 5 hours 20 minutes apiece. Treat Contract as a scoring subject, not a survival one.
If you would like structured support, that is where we come in. CELE SQE (celebar.com) covers all thirteen FLK subjects with courses from the Short-term Course at £1,750 up to the Long-term Course at £3,720, plus a single-FLK option at half price if you only need FLK1; our SQE1 Question Bank subscription is £575 per month for the timed practice this subject demands. Whichever route you take, drill Contract until the four-element check and the remedies sequence feel automatic — reach us on WeChat SQE100 or [email protected] if you want a hand planning it.