Elements of A Contract Singapore Vs Philippines

Rino Gem V.
Gonzales
4LM-1
Introduction to Civil Law
Elements of a Contract
Singapore vs Philippines
Singapore
(Cunanan, 2022)
Contracts are agreements between two or more parties that give rights to correlative
rights and obligations enforceable by law. Tracing back to Singapore’s colonial history, it is no
surprise that its contract law is based on English common law. While Malaysia and Brunei
moved to codify their laws on contract following their independence from England, Singapore’s
Parliament made no such action. The laws on contract consequently remain governed by judge-
made rules or case law, although some have been amended by statutes that are largely English
as well, evident from that 13 commercial statutes originating from English common law that
were incorporated as part of the law in Singapore through the Application of English Law Act.
Requisites for a contract in Singapore:
1. Meeting of the minds manifested through an offer and acceptance
2. Payment of consideration
3. Intent to enter into legal relations
4. Capacity to contract for all parties
5. Consent
Meeting of the Minds
The first element must be broken down into two concepts: offer and acceptance. For an offer to
exist, three requirements must be satisfied. The offer must:
• Contain the terms of exchange;

• Indicate the offeror or offering party’s willingness to be bound by the terms of the
contract; and
• Confer on the offeree or accepting party the power to compel the offeror to perform the
obligations under the contract upon the acceptance of the said offer.
Meanwhile, an acceptance is an unequivocal agreement to the terms of the offer which must be
conveyed to the offeror before it can take effect. It does not require a certain form and can
generally be written or verbal. Silence may not be considered as acceptance except in certain
cases such as when it was expressly stipulated in the contract that silence amounts to
acceptance.
Consideration
Consideration supports the offer, which must have value and is expected to be delivered in
exchange for the product or service promised by the offeror. It may consist of a benefit on the
part of the offeror or a detriment on the part of the offeree. Notably, consideration does not need
to be sufficient and is not legally required to be commensurate to the value of the offer.
Contracts that are not supported by consideration can still be binding under the doctrine of
promissory estoppel. This applies to instances where one party makes a promise that he or she
will not enforce his rights under the contract if it would result in inequity. A party may seek to
enforce an offer or a promise even if the same is not supported by the compliance of the other
party’s fulfillment of their obligation if there is:
1. Clear and unequivocal promise
2. Reliance on the said promise by the promisee or the party that accepted and is now
seeking to enforce the offer
3. Inequity, which usually refers to a detriment suffered by the promisee and other factors
The effect of promissory estoppel is likened to a “shield” rather than a new cause of action on its
own. This means that the aggrieved party can use the doctrine of estoppel as a defense against
the offending party’s action to enforce his rights under the contract.
Intent to Enter into Legal Relations
The will of the parties is central to the third requirement, and it must be evident that the parties
intend to create legal relations. The determination of the parties’ intention is based on the facts
relevant to each unique case.
Generally, commercial arrangements enjoy a presumption that parties intended to be legally
bound. This presumption can be trumped with an express declaration that the parties intended
the contrary, which can be shown in a memorandum of understanding, a letter of intent, or an
honor clause, among others.
Meanwhile, there is an opposite presumption in cases of domestic or social arrangements and
courts will generally presume that the parties did not intend to create legal relations unless the
contrary is proven.
Capacity to Contract for All Parties
For a contract to be valid, parties must have the competence or capacity to contract. A contract
may not be enforced if it was made with a party who is a minor, person of unsound mind, or an
inebriated individual except in specific circumstances, e.g. when a minor is given “necessaries”,
said minor must pay for the same under the Section 3(2) of the Sale of Goods Act.
On the other hand, contracts with companies are always enforceable, as they are considered
“persons” capable of entering into contracts under the law. Even contracts made before the
incorporation of a company may be ratified and adopted.
Consent
Under the law, parties must freely give their consent to the contract for the same to become
binding. If there was coercion to induce another party to agree to the contract through the
employment of duress, undue influence, or unconscionable conduct, the contract may be
voidable. In these instances where there was vice in the consent of the aggrieved party through
the offending party’s improper conduct or “unconscionable bargains” where they exploit a party’s
weakness, the innocent party may elect to rescind the contract.
Rescission will release the parties from their obligations under the contract and restore them to
the state they were in before the contract was constituted. However, the right to rescind may not
be exercised if:
1. (Pinoy Attorney, 2015)Innocent third parties have gained vested rights under the
contract.
2. It is impossible for the parties to be restored to their original state prior to the contract.
3. An excessive amount of time has lapsed since the parties entered into the contract
unless there was fraud.
How Can Parties Be Discharged from a Contract?
1. Discharge by performance
2. Non-performance or defective performance
3. Discharge by agreement
4. Discharge by frustration
Info double checked with (Singapore Academy of Law, 2015)
Philippines
(Philippines Legal Research, 2023)
The Philippine legal system is a mixture of customary usage, Roman (civil law) and
Anglo-American (common law) systems, and Islamic law. The legal system is the result of the
immigration of Muslim Malays in the fourteenth century and the subsequent colonization of the
islands by Spain and the United States. The civil law operates in areas such as family relations,
property, succession, contract and criminal law while statutes and principles of common law
origin are evident in such areas as constitutional law, procedure, corporations law, taxation,
insurance, labour relations, banking and currency.
(Pinoy Attorney, 2015)
Contracts cannot be completed without the following requisites:
(1) Contracting parties' consent;
(2) subject matter of the contract; and
(3) the cause of the obligation.
The Basic Elements of Contracts
Consent
In general, when a consent is given, the contract is considered perfected. It can be deemed an
oral contract that binds both contracting parties. One person must have a definite offer and the
other must have an absolute acceptance of the offer.
Object of the Agreement
The subject matter refers to the object of the contract. If a thing is deemed outside the
commerce of man, it will not be accepted as the object of the contract. Contracts are made to
transfer the rights of property, render services and others. However, the object of the contract
must not be contrary to law, good customs, morals and public order.
Consideration
The cause of the contract will be based on the type of contracts. For instance, onerous
contract's cause is the promise of service or thing by the other person. Remunatory contract's
cause is the benefit or service, which is being remunerated. For contracts of pure beneficence,
the cause is the benefactor's liberality. The cause can only be defined based on the nature of
the contract.
An oral contract may not suffice even if both parties have made an agreement. A written
contract is a strong proof that a deal or agreement has been made. It includes the necessary
details that can be used in court when the obligations have not been met.
Info double checked with (Carpio-Aldeguer, 2014)
Comments and Analyzation

The first thing I noticed in the difference between the two countries is the origins of their
common law, even though both countries were occupied by European countries, the Philippines
was influenced by America and China the most in terms of business.
It is evident that the difference in origin greatly affected the perception of contracts. For
example, the requisites of a contract for each country are:
1. Contracting parties' consent; 1. Meeting of the minds manifested
2. subject matter of the contract; and through an offer and acceptance
3. the cause of the obligation. 2. Payment of consideration
3. Intent to enter into legal relations
4. Capacity to contract for all parties
5. Consent
The Philippine Civil Code defines a contract as “a meeting of minds between two
persons whereby one binds himself, with respect to the other, to give something or to render
some service.” Therefore, Philippines’ requisite for contracts are simpler on the surface, but
each requisite is equivalent to Singapore’s contractual law.
Singapore puts emphasis on the importance of each parties’ capabilities of fulfilling a
contract. Ensuring its perfection from the beginning. While the Philippines prepare for the worse
possibilities and that each parties are responsible for their own services within the contract.
Fun Fact: In Singapore, silence does not automatically mean no, or yes, it depends on the
context of when it was exercised. (Singapore Academy of Law, 2015)
The Court of Appeal agreed with this argument and found that silence is not necessarily
fatal to a finding that terms have been accepted. The effect of silence is context-dependent;
indeed, the High Court had held in Midlink Development Pte Ltd v The Stansfield Group Pte Ltd
[2004] 4 SLR(R) 258 that whether silence amounts to acceptance depended on whether the
conduct of the parties, objectively ascertained, supported the existence of a contract.
References
Carpio-Aldeguer, A. C. (2014, April 19). Law on Obligations and Contracts in the Philippines: An Overview.
Retrieved from SSRN:
htps://deliverypdf.ssrn.com/delivery.php?ID=6350900980260190040880991040310181130350
55008027063057097125086071104122123025125023103053058028021063113099017004116
08000611911802503600100912111306607111809008109303206906709912702609706909900
8126076126104068
Cunanan, J. (2022, September 21). Your Handy Guide to Singapore Contracts. Retrieved from LEXAGLE:
htps://www.lexagle.com/blog-en-sg/your-handy-guide-to-singapore-contracts#toc-3
Philippines Legal Research. (2023, July 27). Retrieved from The University of Melbourne:
htps://unimelb.libguides.com/c.php?g=930183&p=6722001#:~:text=The%20Philippine%20legal
%20system%20is,Spain%20and%20the%20United%20States.
Pinoy Atorney. (2015, October 8). The Essential Elements Of Contracts. Retrieved from Atorney of The
Philippines.
Singapore Academy of Law. (2015). Contract Law. SAL Annual Review, 217-268.

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Rino Gem V.

• Contain the terms of exchange;

Comments and Analyzation

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