Answering a Problem Question
Problem questions can seem daunting as you are faced with a big scenario with various things happening, and it is not always easy to know where to begin. Once you get the hang of these types of questions, you will find a really easy way to show off your legal knowledge. Even though every problem question is different, there are some simple steps that you can follow for any scenario that will help you tackle it in a simple, clear and effective way.
First things first, read the scenario. It might sound obvious, but you need to know what you're up against! A quick read will give you an initial idea of the parties involved, and identify potential issues and how many of them there are - ultimately it will tell you what you need to do! Pay close attention to who you are supposed to be advising or what you are supposed to be advising about as this will impact everything you do from this point onwards.
A good answer will show an ability to apply the law that you have learned in a practical setting. Something as simple are correctly identifying who you are advising, instantly shows the marker that you are engaging in a critical application the law, as opposed to just listing off all the law relevant to the scenario.
Now you have done this, you can move on to identify the parties involved, the issues, and the material facts. These are the pieces of information that are crucial in determining the outcome of the advice you will give. For example, below is a typical problem scenario with the key pieces of information highlighted.
Jamie decides to start up a restaurant called Anything-in-a-Sandwich. Bosworth Bank lends him the money he needs to do so. Jamie must repay the money by monthly instalments over two years. The restaurant soon gets into financial difficulties due to the fact that it just was not possible to hold the stock needed to put anything in a sandwich. Customer's requests could not be fulfilled and word spread that Jamie's restaurant was not living up to its name. This dramatically reduced the number of Jamie's customers.
Jamie went back to Bosworth Bank and explained that he could not make the repayments he owed. He also made it clear that Anything-in-a-Sandwich was in danger of closing. Bosworth Bank therefore agreed that Jamie could have an eight-month period during which he need make no repayments so as to give him time to sort out his business plan, and he could then make the rest of the repayments over six years, with no extra interest to pay.
Three months later, Desia Adriano, a top Premiership football player, contacted Jamie and explained that he would like to have exclusive use of Anything-in-a-Sandwich that Friday night to celebrate his wife's birthday. Jamie realised this publicity would have a useful impact on his business. He told his staff that if they did their job well on the night and the event was a success he would pay each of them an additional £60 in wages for that shift. Jamie also asked his sister Georgina to help out on the night.
The evening was a huge success and Jamie was so pleased he promised his sister Georgina £100 for her efforts. The publicity resulted in a dramatic increase in business and five months later Anything-in-a-Sandwich is a huge success; stocking a whole array of ingredients to fill the sandwiches, and the restaurant is busy every day of the week.
Bosworth Bank is now demanding that Jamie reverts to repaying the loan under its original terms. That from next month Jamie must make monthly payments over two years and must repay the bank in one lump sum the last five monthly instalments that were due. Jamie does not wish to do this as he intends to open a second restaurant under the "Anything-in-a-Sandwich" franchise very shortly and wishes to invest as much of his own capital as he can.
Relations between Jamie and his staff have deteriorated. His sister Georgina has fallen out with Jamie after a major row and Jamie is not speaking to her. He no longer wishes to pay the staff the £60 bonus nor does he want to pay Georgina the £100.
Now that you have pulled out the parties and the key pieces of information, you can begin to shape a plan for your answer.
In the context of the example, the question makes it clear that Jamie is the party we will need to advise. So first we need to identify what we are advising him about: what are the issues? At this stage we do not need to worry about being too legally specific, we just need a general idea of what we need to do. It is clear that we will need to tell Jamie three things:
- Does he have to go back to the original agreement with Bosworth Bank and pay back the last 5 instalments in one lump sum?
- Does he have to pay the staff the £60?
- Does he have to pay Georgina the £100?
These three questions will now form the structure of our answer. These legal issues all need to be split up. You might want to set these out under their own subheadings, but this is up to you. You will need to address each of the questions in turn applying the IRAC formula, and using the facts material to each so as to enable you to effectively and clearly answer them.
What is IRAC?
IRAC, sometimes referred to as ILAC, is a really useful tool designed to help you answer questions such as this in a defined, logical structure and ensure that you won't miss anything from your answer. There are loads of variations on this but essentially, it stands for: Issue, Rule, Application, Conclusion.
IssueIdentify the issue that needs addressing. You have already done this in your preparation to answer the question, so all you need to do here is succinctly summarise the issue for the marker.
RuleYou now need to identify any law that might be relevant to the issue and set it out for the marker to see. Explain the general rules and presumptions to them. You can really show off your knowledge here.
ApplicationThis is the really important part. It is one thing to be able to list and describe relevant law, for example, any member of the public charged with theft could print off and read out the Theft Act! However, if the law was that simple we would have no need for lawyers! The real money is in being able to argue and apply the law in relation to real life situations, and in problem questions; this is where the marks are. You would have listed relevant provisions and cases above, now you need to draw analogies and distinctions between them and the facts of the present issue. Ask yourself: Are they similar, therefore, likely to follow the precedents before? Are all elements of the statutory offence present? Do any of the defences apply to the situation?
ConclusionNow you have done the hard part, all you need to do is explain to the marker what you think the outcome will be. Simple! For example, depending on the question you might need to advise whether they are guilty or liable? Are they entitled to damages? It is important not to sit on the fence here. Be decisive! It does not matter if the marker completely disagrees with your decisions, as long as you have set out why you think this is the case above you have no need to worry.
The best way to understand IRAC is to see it in action, so we will use it now in relation to our example scenario to help advise Jamie.
You can deal with Jamie's questions in any order you like, but for the sake of logic we will begin with advising him as to whether he has to go back to his original agreement with Bosworth Bank and pay back the last five instalments in one sum.
There are two strands to this issue: (i) Can the bank reinstate the original agreement? And; (ii) Does Jamie need to pay back the last 5 instalments in one lump sum? To answer these questions it is necessary to establish the enforceability of the new agreement with Bosworth Bank.
The general rule is that a promise will not be enforceable unless it is supported with consideration. Foakes v Beer establishes that part payment of a debt is not good consideration, as the promisee is doing no more than that which is already required of them at law. This is a seemingly harsh and much criticised rule however it remains good authority.
Lord Denning offered some relief to this, however, through his judgement in Central London Properties v High Trees House. This case concerned a lease for a block of flats during WWII. The lease was signed in 1937 with rent payable at £2500 a year. Following the outbreak of the War, it was not possible to get tenants for all of the flats and the defendants were struggling financially. The plaintiffs, therefore, agreed to accept a lesser payment of £1250 rent a year while the difficulties continued. Following the end of the war, however, the flats were once again all let out and the plaintiffs wished to reinstate the original higher rent and claim the difference for the reduced rent during the war years. Denning stated that the original agreement could be reinstated as the promise was only intended to be binding whilst the difficulties in letting the flats remained. In relation to the arrears, however, Denning opted not to follow the harsh authority of Foakes v Beer and instead stated that in certain situations where a promise had been made that was intended to be binding, and acted upon and was indeed acted upon, it will be binding so far as its terms properly apply. The plaintiffs would, therefore, be estopped from claiming back the arrears. This decision formed what is known as the equitable doctrine of promissory estoppel, and it can be used as a defence to claims in cases in similar circumstances to the above facts.
The material facts here are, that Jamie has an agreement with Bosworth Bank whereby he must repay the money they lent to him by monthly instalments over two years. Anything-in-a-Sandwich then got into difficulty and Jamie had to inform the Bank that he would not be able to meet the repayments, upon which Bosworth Bank agreed Jamie could have an eight-month period during which he need make no repayments and he could then make the rest of the repayments over six years, with no extra interest to pay.
Applying the law in this area to the present case, as Jamie has provided no additional consideration for Bosworth Bank's promise, other than which his loan agreement required of him, following Foakes v Beer, prima facie, Bosworth Bank's promise is not enforceable. Therefore, they are within their rights to revert to the original terms of the agreement. Jamie will be subject to the reinstated agreement and be liable to pay back the instalments in the lump sum demanded. However, applying the very factually similar case of Central London Properties v High Trees House would provide Jamie with some relief. It would seem that promissory estoppel will prevent Bosworth Bank from claiming back the five instalments. It is evident from the scenario that they made a promise to Jamie, that they intended to be both binding and enforceable, and that Jamie acted on reliance of this promise and did as he was obliged to under the new terms.
From the above, it is therefore suggested that Jamie will be bound by the original terms of the agreement following Bosworth Bank's statement that they wish to reinstate it. However, applying Central London Properties, Jamie will not need to pay back the five instalments of arrears to Bosworth Bank.
Now all we would need to do, is repeat this process for the two remaining issues and we will have successfully tackled the question!
It is really important that the IRAC formula is applied to each individual issue, as trying to tackle the question all at once, identifying all of the issues, then all of the relevant law, applying it across all of the scenarios and then concluding, will only serve to make life harder for you and confuse the marker! Breaking it down into these simple steps serves to give your answer a really clear structure and makes sure that you don't miss anything.
The best way to get the hang of this is to practice! Perhaps go back to the example scenario and have a go yourself, advising Jamie of the two outstanding issues: Does he have to pay the staff the£60? And; Does he have to pay Georgina the £100? Remember to deal with each issue individually, and follow the simple steps set out, advising Jamie using the IRAC structure. Once you have practiced this a few times, you will feel ready for any question an examiner can throw at you and you will relish the opportunity to show off your legal knowledge.