Chapter 9: Representation And Terms

Question 1

Contractual term

Answer 1

A statement included in the agreement as a legally enforceable obligation

Question 2

Pre-contractual representation

Answer 2

Statement one party makes with the intention of inducing another party to enter into a contract

Question 3

Misrepresentation

Answer 3

False statement of an existing fact that causes recipient to enter into a contract

Question 4

Opinion

Answer 4

Statement that is a belief or judgement

-not misrepresentation unless stated in a way to make someone believe it’s true

Question 5

Statement of future conduct

Answer 5

Statement about future interactions

Not misrepresentation unless:

• statement made fraudulently
• future conduct described in terms of present intention

Question 6

Silence distort previous assertion

Answer 6

If circumstances change to affect the accuracy of earlier representation, the burden falls on the person who made the statement to disclose the change

Question 7

Statement as a half truth

Answer 7

Unspoken words alter meaning of the statement

Question 8

Contract of utmost good faith

Answer 8

Requires a party to fully disclose material facts

A breach is considered misrepresentation

Question 9

Special relationship between parties

Answer 9

Relationship is one of trust or one party has special influence over the other

Other party must disclose material facts whether questions are asked or not

Question 10

Inducement

Answer 10

Deceived party must prove that false statement mislead recipient into entering contract

Question 11

Recission

Answer 11

Cancellation of contract with aim of restoring parties to their pre-contractual state

Question 12

Restitution

Answer 12

Giving and taking back on both sides

Question 13

Affirmation

Answer 13

When misled party declares an intention to carry out contract as though they were bound by the contract

Question 14

Damages (in misrepresentation)

Answer 14

Awarded against party that made statement

Meant to compensate for damages suffered as a result of relying upon a misrepresentation

Question 15

Innocent misrepresentation

Answer 15

Carefully made statement without knowledge that fact is false

Remedy: recission

Question 16

Negligent misrepresentation

Answer 16

Misrepresentation made recklessly without regard to the truth

Remedy: recission
-possibly damages (if treated as a tort)

Question 17

Fraudulent misrepresentation

Answer 17

Make statement (that is known to be false) without regard for the truth

Remedy: damages (tort of deceit)

Question 18

Express terms

Answer 18

Statement made by a party that a reasonable person would would believe was made with the intention to create enforceable obligation

Question 19

Parol evidence (rule)

Answer 19

Evidence not contained in the written contract

Generally not enforceable

Question 20

Exceptions to parol evidence rule

Answer 20

• proof a contract a contract wasn’t fully formed/ defective
• used to resolve ambiguities in contract
• demonstrate that document does not contain parties complete agreement
• collateral contract

Question 21

Collateral contract

Answer 21

A statement that is separate agreement made in exchange for another party’s entrance into main contract

Question 22

Literal approach to interpretation of express terms

Answer 22

Ordinary meaning, plain stated

Question 23

Contextual approach to interpretation of express terms

Answer 23

Look at party’s presumed intentions and their circumstances

Question 24

Golden rule

Answer 24

Meaning of works are given plain meaning unless doing so leads to absurdity

Question 25

Contra proferentum rule

Answer 25

Meaning least favourable to author of contract will prevail

Question 26

Implied terms

Answer 26

Arises by operation of law (common law or statute)

Question 27

Exclusion clauses

Answer 27

Contractual term that seeks to protect one party from various forms of legal liability

Question 28

Boilerplate clauses

Answer 28

Standard provision that can be reused in various contractual settings

Question 29

Force majeure clause

Answer 29

Type of boilerplate clause

Aims to protect parties when some part of contract cannot be performed because of an event outside their control

Question 30

Confidentiality clauses

Answer 30

Prevents disclosure of some terms in contract to third parties

Narrowly drafter to only apply to some terms

Question 31

Arbitration clause

Answer 31

Outlines who should resolve inevitable dispute and what method of arbitration should be used

Question 32

Jurisdiction clause

Answer 32

Predetermined locale of the court/ whose law shall apply in a dispute

Question 33

Entire agreement clause

Answer 33

Stipulates that entire agreement continued only in the contract

-exceptions to parole evidence cannot operate