This is an unenforceable agreement which courts will refuse to enforce. It is a gambling agreement or Sponsione Ludicrae (Ludicrous promises). It's a contract in which people enter by usually placing a bet on a variety of sporting event or activity. The courts will not enforce these kinds of disputes which arise out of these agreements as they regard them as beneath them and their dignity. This stems from the time of Christianity which was a much more powerful force. Gambling was seen as a social evil and in no circumstances was such activity to be tolerated and promoted.
They seen by denying gamblers an effective means of enforcing these kinds of agreement courts were more or less telling people they did so at their own risk. Relevant cases Ferguson v Littlewoods Pools Ltd (1997) - Members of a pool syndicate had won several millions of pounds on a football coupon or so they thought. The syndicate was unaware that the agent for Littlewoods pools had not forwarded the stake money as he had stolen it. When theft was recovered the syndicate members demanded that Littlewoods honour the winning tickets.
Littlewoods claimed they had never received the winning tickets. The syndicate argued that Littlewoods was responsible for the actions of its dishonest agent. The syndicate took this to court. The Court of Session held by Lord Coulsfield in the outer house he said that the contract between the syndicate and Littlewoods was an example of a gambling agreement or gaming contract so was therefore unenforceable. Lord Coulsfield refused to order Littlewoods to pay sum out owing them.
Robertson v Balfour (1938) - Robertson had entered into a gambling agreement with Balfour a bookie to place bets on two horses one called swift and true and the other called scotch horse. Both horses run their races but when Robertson went to claim his winnings all he received was a mere i?? 10 from Balfour. But he owed him i?? 33 in winnings; Robertson agreed that he could give Balfour extra time to pay his balance. Robertson could not force agreement against Balfour to pay out the additional i?? 33 as it was a gambling debt and the courts will not enforce it.
The only difference is if two people agree to split winnings made from gambling and the agreement is made between themselves and not the place they are winning the money from. It can be called a collateral contract or a unilateral promise. A case relevant to this is Robertson v Anderson (2002) in the Mecca bingo hall in Drum chapel where in bilateral obligations are that the parties owe duties to each other. Case study 2 Morag would not get the furniture as the auctioneer hammer had not fallen so the sale was not complete, so a contract had not been formed and Hermione had withdrawn the goods before the hammer had fallen.
But it is important to know the difference between an offer and an invitation to treat especially at an auction. Judges of the 2nd Division went on to consider if a seller could withdraw his property for sale before the fall of the auctioneers hammer. It is the seller that was putting his goods up for an invitation to treat and if the goods are withdrawn then it is indicating that none of the offers are acceptable to him and he is rejecting them.
It is said by Lord MacDonald the Lord Justice Clerk in the inner house of the court of Session that even though whatever the law was before the Law of Scotland now, is that a sale by auction is complete when the auctioneer announces its completion by the fall of a hammer or in any other customary manner until such announcement is made then any bidder may retract his bid. But the law in Scotland before the introduction to the sale of goods act 1893 was that it would not always have been permitted or the seller to withdraw from the auction in a similar circumstance. Relevant cases
Fenwick v Macdonald, Fraser & Co Ltd (1904) - the pursuer made a bid for a bull that was part of a head of cattle sold at auction. In the Auctioneers catalogue it was said that the cattle were described as offered for unreserved sale. The pursuer in common with other bidders thought that this phrase meant that the owners had not placed a reserve price on the bull. There was certainly no mention made of any reserve price in the sale of the animal. If a reserve price had been made on goods by the owner then the auctioneer has no authority to sell for anything less than this.
The owners of the bull decided to withdraw the animal from the auction on the grounds that a reserve price of 150 guineas had not been met by any bidders including the pursuer the pursuer sued for breach of contract. By the inner house of the court of session that there was no contract. Lord Macdonald the Lord Justice Clerk stated that: whatever might have been the law formerly, the law of Scotland is now that a sale by auction is complete when the auctioneer announces its completion by the fall of the hammer or in other customary manner. Until such announcement is made any bidder can retract his bid.
B) Restrictive covenant is used by one party in a contractual relationship to promote legitimate business interests from unjustified exploitation or interference by another person for example. Ex employees who are now employed by business rivals and former owners of a business to set up or attempt to set up rival businesses. So if Hermione has got a contract with Piers with a clause in it with his employment to prevent him from working with a business competitor in the EU for 18 months it is meant that he cant but it will be down to the courts to decide if it is acceptable or to the extreme.
This is because such terms can be abusive so are scrutinised by Scottish courts and judges will tend to display a suspicious attitude when asked to consider contracts with restraints of trade. These are called restrictive covenants or contracts in restraints of trade because the terms are restrictive in the sense that they limit the freedom of one of the parties to the contract to do certain things. They can be used to prevent an employee working for a business rival once current employment has ended.