Certainty and completeness 

A court cannot enforce a promise it cannot identify. Two related objections arise: the agreement may be uncertain — its terms cannot be given meaning — or incomplete — something essential was never settled. Either can defeat a contract that otherwise has agreement, consideration and intention.

The two are worth separating, because the answers differ. Uncertainty is a problem of meaning; incompleteness is a problem of coverage.

The court's disposition

Courts lean towards upholding bargains, particularly where the parties plainly intended to be bound and especially where the agreement has been partly performed. Judges have repeatedly said that they will not adopt a narrow or pedantic approach that defeats what commercial parties evidently meant to do.

That disposition shows up in several ways:

• Construction first. An apparently vague term is read in context, against the background of the dealing and any trade usage, before it is condemned as meaningless.
• Severance. A meaningless clause may sometimes be severed, leaving the rest standing, provided what remains still reflects the bargain.
• Machinery. Where the parties provided a mechanism for resolving a term — a formula, a nominated valuer, a reference to a market rate — the agreement is usually certain enough, and the mechanism may be applied even if the chosen route fails.
• Implication. A term may be implied to fill a gap, most commonly a term that a price or standard will be reasonable.

This disposition has limits. Whitlock v Brew (1968) 118 CLR 445¹ shows that a bare agreement to agree future terms — with no formula, standard or mechanism a court could apply to resolve disagreement — remains uncertain and unenforceable, however much the parties plainly meant to be bound by something.

Where agreements fail

Despite that disposition, some agreements cannot be saved:

• Essential terms left open. If the parties have not settled a matter the contract cannot work without — and provided no means of settling it — there is nothing to enforce.
• Illusory promises. Where performance is left to the unfettered discretion of one party, that party has not committed to anything, and the promise is illusory rather than merely vague.
• Genuinely meaningless language, where construction and severance both fail.

Agreements to agree

A promise to negotiate, or to agree a term later, is ordinarily not enforceable: there is no standard by which a court could judge whether the obligation was performed.

But the label is not decisive, and two distinctions matter:

• An agreement to negotiate in good faith may be enforceable where it is framed with enough content to be justiciable, and Australian authority is more receptive to this than is sometimes assumed.
• An agreement that is complete, but contemplates the parties recording it in a formal document later, is binding now. Whether a document is of that kind, or is instead conditional on execution, is a question of construction.

Applying this in a problem question

1. Identify the term said to be uncertain or missing, and say which objection it is.
2. Try construction: does the term have a meaning in context, or by trade usage?
3. Look for machinery, or a basis for implying a reasonable price or standard.
4. Ask whether the term is essential — an unsettled peripheral matter rarely defeats a contract, an unsettled core obligation usually does.
5. Consider severance if a discrete clause is the only problem.
6. Weigh partial performance, which strongly suggests the parties thought they had a deal.

Certainty completes the formation analysis begun with agreement, consideration and intention. A contract that clears all four may still be affected by its terms and by any vitiating factors.

Where the authority sits

Common law, developed through decided cases and heavily fact-dependent. Because so much turns on construction, the reasoning in individual judgments matters more here than a statement of rule — read the cases for how the court approached the language, not only for the outcome.