Contract Law in Ireland-the Essentials

contract law in ireland

We all come into frequent contact with contracts in our daily lives.

Public transport, shopping, visiting your solicitor/doctor/physiotherapist, buying a second hand car, buying a sliced pan in Tesco or Supervalu-the instances of contract law being relevant in your day to day living are infinite.

Let’s take an overview of contract law in Ireland, shall we?

First, what is a contract?

A contract is, at its essence, an agreement between 2 or more parties. It has been defined as an agreement, enforceable at law between two or more parties whereby rights are acquired by one or more persons in return for certain acts or forbearances on the part of the other or others.

By and large, and subject to certain exceptions, the parties to the contract are free to agree their own terms and conditions.

The Components of a Contract

There are a number of essential ingredients to form a valid contract. There must be

  1. Agreement between the parties
  2. Consideration (something of value)
  3. Intention to create legal relations.
  1. Agreement

In order for agreement to be arrived at there must be an offer by one party and acceptance by the other party. The acceptance must be without qualification and the offer must be clear and unequivocal.

i) The Offer

The offer may be oral or in writing and made to one or more persons. An offer can be terminated in 3 ways:

  1. It is accepted
  2. It is rejected
  3. A counter-offer is made.

An offer can also be withdrawn before acceptance, provided this withdrawal is communicated to the other party. Offers do not last indefinitely and will lapse after a reasonable period of time.

What is considered ‘reasonable’ in any situation will depend on the circumstances. They can also lapse after passing a time limit.

An offer must be intended to become binding when accepted, and not just an invitation to treat or the provision of information or mere statements of intention. (An invitation to treat is where one party invites the other party to make an offer-for example, when a solicitor issues a contract for the sale of property-this is an invitation to treat, not an offer. Advertisements would also be considered invitations to treat.)

ii) Acceptance

Acceptance of the offer, if it is to be valid, must also be clear, unambiguous, and unconditional. Acceptance can be verbal, in writing, or clear from the conduct of the party who is accepting. If acceptance does not mirror the offer it may instead become a counter-offer with no agreement or contract in place.

2. Intention to create legal relations

An enforceable agreement only comes into being if the parties intended that they enter into legal relations. Business agreements are normally assumed to be legally binding whereas social agreements or contracts may not be.

If you promise to bring your child to GAA training but fail to do so he cannot sue you on foot of that failure.

Correspondence marked ‘without prejudice’ or ‘subject to contract’ is not intend to be legally binding until the parties have agreed all terms and conditions.

3. Consideration

Consideration-something of value-is a vital part of an enforceable, binding contract. An example of consideration is the price you might pay for goods or services.

Consideration can also be some forbearance or loss or detriment suffered by one of the parties. Both parties need to provide some consideration for the contract to be binding and the consideration must have legal value, even if this is only 1 euro or a peppercorn as the value of the consideration is irrelevant.

Past consideration-that is, consideration given before the parties entered into the agreement at hand-is not sufficient consideration to enforce the contract.

Oral and Written Contracts

It is not essential that a contract is committed to writing.

Clearly, it will be easier to ascertain what was agreed between the parties in the event of a dispute, however. A contract can also be inferred from the course of conduct between the parties.

When you go into a shop to buy milk or bread you are entering into a contract with the retailer, albeit the contract will not be in writing.

However, statute decrees that certain contracts must be in writing or must be evidenced by a memorandum in writing-for example, the sale of land. This memorandum must show the parties, the price, and the property.

Other Contractual Issues

The parties must agree freely to enter into a contract agreement. Undue influence and duress will make a contract voidable.

Courts will also refuse to enforce contracts which are contrary to public policy or which are made to pursue an illegal object.

Capacity-that is, legal capacity, is required to enter into contract.

Certain individuals such as minors, persons under the influence of drink or drugs, individuals suffering from mental illness are not deemed to have the capacity to enter into a legally binding contract and there are rules surrounding contracts for persons in these categories.

Limited companies can only enter into contracts permitted by their company memorandum of association.

Terms of the contract

What is contained in the contract-the meat and potatoes-are various terms and conditions. These terms can be express or implied.

Express terms are those set out in writing in the contract itself and are the nuts and bolts of the agreement struck between the parties.

Various terms can be implied into a contract, for example those implied by statute or common law or the constitution or custom and practice in the industry. Terms can also be implied to give the contract business efficacy-that is, make sense of it.

Conditions and warranties

The terms of the contract may be conditions or warranties. Conditions are fundamental to the contract and the breach of a condition will allow the other party to repudiate the contract.

Warranties, on the other hand, are not as fundamental and breach of a warranty may give rise to a claim for damages or compensation but will not necessarily give the right to repudiate the contract and call it at an end.

Non Binding Contracts-Void, Voidable, and Unenforceable

A void contract is an agreement without legal effect. This may be due to a fundamental mistake by both parties when arriving at the agreement, which mistake must go to the root of the agreement. A minor entering into a contract to buy property would also be void.

The usual remedy for a void contract is rescission which allows a party to set the agreement aside and be restored to his former position and both parties are released from the contract and its obligations.

A voidable contract is one which allows one of the parties to terminate the contract due to relying on misrepresentation of a material fact. However, that party can also affirm the contract. Certain statements, though, for example sales guff, are not intended to be relied upon.

The innocent party can treat the contract as being at an end and seek to recover damages.

An unenforceable contract is one which the Courts will not enforce as there is something missing-for example a written memorandum of the agreement/contract in a sale of land, which is required by statute. In this situation if one of the parties refuses to perform the contract he cannot be forced to do so.

Ending a contract

How is a contract brought to an end? In a number of ways.

  1. By performance

Both parties discharge their obligations under the contract. Performance must be complete, not partial. If the performance is prevented by one party the other party may sue on a quantum meruit basis to prevent unjust enrichment.

2. By agreement

The parties can agree not to pursue the contract and waive their rights under it.

3. Discharge by notice

An employment contract, for example, can be terminated by giving the required notice period. If there is no notice period provided in the contract reasonable notice must be given. What’s reasonable will depend on the circumstances.

4. Discharge by operation of law

5. Discharge by frustration

A contract can become frustrated when it becomes impossible to perform due to circumstances beyond the control of the parties-for example a sales representative or lorry driver losing his driving licence may be unable to fulfill the contract, no matter how willing he may be.

6. Discharge by breach

A contract can be discharged by breach of a condition of the contract. The wronged party can treat the contract as discharged or he can continue with the contract and sue for damages.

If the breach is breach of a warranty the wronged party can sue for damages only.

Remedies for breach of contract

  • Damages-this is the payment of monetary compensation for breaches of the contract. The damages are intended to put him in the position he would have been in if the contract had been performed.

The damages awarded can range from nominal to exemplary. You can read more about damages in civil law here.

  • Quantum meruit-read about quantum meruit here. Quantum meruit is the payment of a reasonable sum for the work done, as opposed to damages for breach of contract or compensatory damages.
  • Specific performance-this is an equitable remedy which directs the party in breach to perform his part of the contract.
  • An injunction-this is another equitable remedy which orders a party to do or refrain from doing an act in pursuance of the contract


The above is a 10,000 foot view of contract law in Ireland. There is statute law dealing with contract, too, such as the Sale of Goods and Supply of Services act, 1980 and the Consumer Protection Act, 2007 which deals with consumer contracts in Ireland while the Land and Conveyancing Law Reform Act 2009 deals with contracts for the sale of land. (Learn more about property law in Ireland here).

Without Prejudice Communication in Legal Proceedings-What You Should Know


without prejuduce correspondence2

Have you received a letter marked “without prejudice”? Or been made an offer on a “without prejudice basis”? For example, a settlement agreement when you are leaving your job will be marked “without prejudice”, until it is signed by both parties and becomes binding on both parties.

What does this mean, though?

Let’s take a look, shall we?

The Without Prejudice Rule

The Without Prejudice rule/principle is one which states that statements made orally or in writing and marked “without prejudice” with a view to settling a dispute will normally not be admissible in evidence against the party who makes the statement or writes the letter.

It is similar to an “off the record” conversation you may have heard of in various circles eg journalism.

The reason this principle is accepted and encouraged is that it is widely regarded as a good thing that parties to a dispute will attempt to settle their differences rather than going to Court on every occasion. Thus, there is a clear public policy justification for the rule.

Any concession offered in a without prejudice letter cannot be referred to later on if the matter is not settled and it goes ahead to Court. Therefore, if I owe you a disputed debt of €100,000 and you offer, in a without prejudice letter, to accept €70,000 in full and final settlement, and I do not accept this offer you can pursue me for the full €100,000 in Court and I cannot refer to your previous willingness to accept €70,000 as evidence that I do not owe you €100,000.

This liability of €100,000 must be disputed by me, though. If I accepted I owed the €100,000 but was merely looking for a discount then I cannot rely on the Without Prejudice label as there is no dispute about the debt or the amount owed.

Where a party makes a without prejudice the response to that offer, regardless of the content, is also privileged as the entire totality of that correspondence is privileged.

The Without Prejudice Label

Marking your correspondence “without prejudice”, however, does not mean it is truly without prejudice; your letter must have been part of an attempt to settle the dispute and there must have been legal proceedings in being or being contemplated by one of the parties. Using the label will not give any protection if the correspondence is not a genuine attempt to settle a dispute.

Thus, another way to think of without prejudice correspondence, which will have the protection later on, is without prejudice correspondence which makes some type of concession. If it does this then it is clear it is an attempt to settle the dispute.

A without prejudice letter is the opposite of open correspondence.

An open letter may contain an offer, for tactical reasons in litigation, to settle a dispute. This letter will be relied upon in Court to influence the Judge when it comes to awarding costs at the end of the hearing and if such a letter is written it should be made clear that it is open.

Two Without Prejudice Labels

There are two without prejudice labels in use:

  1. Without prejudice
  2. Without prejudice save as to costs

The Without Prejudice save as to costs letter is a Calderbank letter (learn more about Calderbank letters here). This type of without prejudice correspondence can only be referred to when the question of costs is being considered by the Court at the end of the trial.

Exceptions to the Without Prejudice Rule

There are exceptions to the rule:

  • When the communications demonstrate the fact of a concluded settlement agreement
  • To help interpret a settlement agreement
  • To provide evidence to have a settlement agreement set aside on the basis of fraud, misrepresentation
  • Where the communications are evidence of perjury or blackmail or other serious impropriety.


The rule applies to written and oral communication, and must be a genuine attempt to settle a dispute. It is the substance of the correspondence that counts, not the label, and this will be assessed objectively.

It is open to the parties where there is no dispute, for example in relation to property purchase/sales, that all correspondence will be without prejudice/subject to contract until there is a binding contract in place. This is the practice in conveyancing in Ireland.

Without prejudice correspondence attracts joint privilege which means that it can only be waived with the consent of both parties.

The Zen of the Mediation Act, 2017

mediation act 2017

The Mediation Act, 2017 came into law in Ireland on 1st January, 2018. The purpose of this legislation is to allow parties to a dispute to avoid the costs of litigation and to reduce the number of disputes coming before the Courts.

Mediation is a collaborative process which aims to encourage the parties to a dispute to arrive at their own solution, with the professional assistance of the mediator. The mediator is to facilitate the parties and provide his/her professional expertise and experience but the determination of the dispute is up to the parties themselves.

The mediator can make proposals to resolve the dispute when the parties request this. There may also be a need for experts in a mediation if the issues are complex-for example a financial dispute with taxation implications.

It will have significant implications for solicitors in their daily practice of advising clients, and for clients who wish to institute litigation proceedings.

Before commencing legal proceedings on behalf of a client a solicitor will have to swear a statutory declaration that

  1. He/she has advised the client of the availability of mediation as a way to settle the dispute
  2. Give the client information about the benefits of using mediation, as opposed to instituting legal proceedings
  3. Give the client names and addresses of mediators who may be able to assist in resolving the issues between the parties
  4. Tell the client that mediation is voluntary and may not be appropriate where the safety of the client is at risk or where there is children and their welfare/health/safety is at risk
  5. Advise the client of the need for confidentiality in a mediation and the enforceability of a mediated agreement
  6. Advise the client of the solicitor’s obligation to provide a statutory declaration confirming the provision of the information above to the client

The statutory declaration should accompany whatever document is used to commence legal proceedings. If this does not occur the Court can adjourn proceedings until such time as the solicitor has provided the Court with the statutory declaration.

The Mediation Act, 2017 will not apply to certain proceedings, for example High Court judicial review proceedings and an arbitration under the Arbitration Act, 2010. The full scope of the act is set out in section 3, Mediation Act, 2017.

A court will be allowed to take into account when awarding costs any party’s unreasonable refusal or failure to use mediation.

Part 2 of the Act sets out the provisions re mediation generally including the role of the mediator, codes of practice, and the enforceability of settlement agreements arrived at through mediation.

Part 3 sets out the obligations of solicitors and barristers with respect to mediation and Part 4 sets out the role of the Court.

Section 19, Mediation Act, 2017 is an interesting one as it allows a Court to adjourn court proceedings to facilitate mediation:

9. (1) Where—

(a) parties have entered into an agreement to mediate, and

(b) one or more of the parties referred to in paragraph (a) commences proceedings in respect of the dispute the subject of the agreement to mediate,

a party to the proceedings may, at any time after an appearance has been entered and before delivering any pleadings or taking any other steps in the proceedings, apply to the court to adjourn the proceedings.

(2) On application to it being made under subsection (1), the court shall make an order adjourning such proceedings if it is satisfied that—

(a) there is not sufficient reason why the dispute in respect of which the proceedings have been commenced should not be dealt with in accordance with the agreement to mediate, and

(b) the applicant party was at the time when the proceedings were commenced, and still remains, ready and willing to do all things necessary for the proper implementation of the agreement to mediate.

(3) This section is in addition to and not in substitution for any power of a court to adjourn proceedings before it.

Some commentators have advanced the opinion that an employer, with an employment contract containing a clause agreeing to mediation in the even of a dispute, can have Court proceedings adjourned pursuant to section 19. It is too early to say how a Court will view this argument but it is probably advisable for an employer to have such a clause in his contract of employment as he has nothing to lose in doing so.

Section 16 provides for a court inviting the parties to engage in mediation and section 17 provides for the mediator to provide a report to the Court to explain why the parties have not so engaged or to explain why the mediation has failed and they wish to re-enter legal proceedings.

Here is a link to the Court rules concerning the implementation of the provisions of the Mediation Act, 2017.


The Mediation Act, 2017 is to be welcomed as it should allow more parties in dispute resolve their issues without the cost of going to full blown legal proceedings including a Court trial.

And if you are an employer it cannot do you any harm to insert a clause in your contract of employment providing for the use of mediation before instituting legal proceedings.

Defamation Law in Ireland-What You Should Know

defamation law

Everyone is entitled to their good name and reputation. Our constitution, Bunreacht na hEireann, recognises this in article 40.3.2. And our statute books recognises this right, too.

For defamation is now a statutory tort-that is a civil wrong. It is defined in section 6, Defamation Act, 2009 as

2) The tort of defamation consists of the publication, by any means, of a defamatory statement concerning a person to one or more than one person (other than the first-mentioned person), and “ defamation ” shall be construed accordingly.

It is worth noting that defamation is now actionable per se, even in circumstances where there is no proof of special damage. Section 12 of the act also allows a body corporate to bring a defamation action.

Defamatory statement

A defamatory statement is defined in section 2, Defamation Act, 2009 as

“ defamatory statement” means a statement that tends to injure a person’s reputation in the eyes of reasonable members of society, and “defamatory” shall be construed accordingly;


This statement can be written or oral, therefore a false, oral accusation in a shop of, for example shoplifting or failing to pay for goods, can be defamatory.

Publication can also take place in the traditional written media such as newspapers and magazines but an increasing number of defamation actions are arising from social media websites such as Twitter, Facebook, etc.

We have all seen a raft of debates and exchanges on social media sites which have become extremely heated, often culminating in defamatory statements being published for the whole world to see.

Early in 2017 a Donegal couple were awarded €30,000 in a defamation action they brought against their neighbour arising from false, defamatory postings made by the neighbour on Facebook. The neighbour had admitted the wrongdoing and apologised to the couple.

Statute of Limitations

Section 38 of the act provides that you must bring your defamation action within one year, although this can be extended to two years in exceptional circumstances.

At its simplest defamation will occur where a defamatory statement is made to a third party.

A defamation action is

“defamation action” means—

(a) an action for damages for defamation, or

(b) an application for a declaratory order,

whether or not a claim for other relief under this Act is made


Section 8 of the act obliges the parties to a defamation action to swear a verifying affidavit, similar to an affidavit of verification in a personal injuries action, swearing as to the truth of pleadings and assertions or allegations of facts.

Defences to a defamation action

There are statutory defences to a defamation action as follows:

Section 22 provides a statutory offer to make amends and the effect of the offer to make amends is set out in section 23.

Section 24 provides for a statutory apology scheme which will mitigate a defendant’s damage. Such an apology is not an admission of liability and evidence of the apology is not admissible in any civil action as evidence of liability of the defendant.

Remedies for defamation

Section 28 of the Defamation Act, 2009 provides for a declaratory order from the Circuit Court. This order will state that the statement was defamatory of the applicant.

Damages are also a remedy, as set out in section 31 of the act and a correction order can be made by the Courts, pursuant to section 30, and a prohibitory order pursuant to section 33. Section 32 allows a Court to order the defendant to pay aggravated and punitive damages where (b) the defendant conducted his or her defence in a manner that aggravated the injury caused to the plaintiff’s reputation by the defamatory statement.

Section 29 allows a defendant to pay a sum of money into Court in satisfaction of the defamation action.

Constitutional right to good name

Article 40.3.2 of Bunreacht na hEireann states:

The State shall, in particular, by its laws protect as best it may from unjust attack and, in the case of injustice done, vindicate the life, person, good name, and property rights of every citizen.

A defamation action will also include a claim damages for breach of the Plaintiff’s constitutional right to maintain his/her good name.

Defamation proceedings

Defamation proceedings are commenced in the High Court by way of a Plenary Summons and Statement of Claim.

What to do if you think you have been defamed

If you think you have been defamed you should consider getting professional advice. It is easy, in the heat of an argument online, to form the view that you have been defamed but whether you have or not is something you should get professional advice on.

Your good name and reputation is a fundamental personal right recognised in the Irish Constitution and any defamatory remarks that go unchallenged may lead to significant damage to you in both a personal and business capacity.

Depending on the context of the defamatory remarks you may also have other causes of action against anyone who makes such remarks against you, for example breach of contract, negligence, breach of duty.

The High Court Affidavit of Verification In Personal Injury and Defamation Actions

affidavit of verification

An affidavit of verification is required in the High Court to verify assertions or facts alleged in personal injury actions and defamation proceedings. It is to verify a pleading or replies to a request for further information and is required pursuant to section 14 of the Civil Liability and Courts Act, 2004 in personal injury actions, and pursuant to section 8 of Defamation Act, 2009.

A copy is served on the party who is being served with the pleading or replies to further information.

(4) An affidavit under this section shall be lodged in court not later than—

(a) 21 days after the service of the pleading concerned or such longer period as the court may direct or the parties may agree, or

(b) in the case of a requirement to which subsection (8)(b) applies, 7 days before the date fixed for the trial of the personal injuries action concerned. (Section 14 Civil Liability and Courts Act 2004).

The form it should take is as follows:


O. 1A, r. 10


20…. No……
Between A.B., …………….. Plaintiff,

and C.D., …………. Defendant.

I, AB, ……………….. of …………………. , the (plaintiff, defendant or state other capacity or authority) in the above-entitled proceedings, aged eighteen years and upwards MAKE OATH and say as follows:

1. I beg to refer to the contents of the (personal injuries summons, defence, reply, further information etc. – as the case may be) delivered herein on behalf of the (plaintiff/ defendant) on the ….. day of ………….. 20 …. *[upon which this affidavit is endorsed] *[and upon a true copy of which marked “A” I have signed my name prior to the swearing hereof].

2. The assertions, allegations and information contained in the said (personal injuries summons, etc.) which are within my own knowledge are true. I honestly believe that the assertions, allegations and information contained in the said (personal injuries summons, etc.) which are not within my own knowledge are true.

3. I am aware that it is an offence to make a statement in this affidavit that is false or misleading in any material respect and that I know to be false or misleading.


It is an offence to make a statement in an affidavit that is false or misleading and you can be fined up to €100,000 and/or imprisoned for up to 10 years, pursuant to section 29 of the Civil Liability and Courts Act, 2004.