Contents of a Contract

Question 1

Two ways terms may be implied by court

Answer 1

1. Terms implied by fact
2. Terms implied by law

Question 1

The ways terms may be implied into a contract (3)

Answer 1

1. Trade custom or trade practice
2. Law
3. Court

Question 2

Tests applied for terms implied in fact

Answer 2

1. Business efficacy test
2. Officious bystander test
3. Composite test

Question 3

Case for business efficacy

Answer 3

The Moorcock

Question 4

Case for officious bystander

Answer 4

Shirlaw v Southern Foundries

Question 5

Case for composite test

Answer 5

BP Refinery v Shire of Hastings

Question 6

What is the business efficacy test

Answer 6

To make the contract work in the way that was intended by the parties to the contract

Question 7

What is the officious bystander test

Answer 7

something so obvious that it goes without saying; so that, if, while the parties were making their bargain, an officious bystander were to suggest some express provision for it in their agreement, they would testily suppress him with a common ‘Oh, of course!

Question 8

What is the composite test

Question 9

Case for implying terms into a contract

Answer 9

Bathhurst v L&M Coal (Continue to load coal being considered valid acceptance)

Question 10

What are the three principles from Bathhurst v L&M coal?

Answer 10

1. Starting point is the expressed words of the contract
2. High threshold for implying an unwritten term; strict necessity
3. Use the three tests to test the necessity