Contract 4 - Terms & Exemptions Flashcards
What are the 3 types of statements that can be made during negotiations?
- Mere Puffs (no legal significance) π¨
- Representations: statements of fact/law which parties donβt intend to be binding but help induce making of the contract
π - Term: statements of fact parties intend to be binding βοΈ
Can a statement be both a representation and a term?
Yes
What is the difference between a representation or a clause?
- clause = parties intended to be bound: (what would a reasonable person understand to be the intention of the parties, having regard to all the circumstances?) βοΈ
- If not, could be representation or mere puff
- Where a statement is made to induce the other party to enter the contract π, presumption that itβs binding but can be rebuttedπ£οΈπβοΈ
What factors should be considered to determine if a something is a representation or a term?
- Importance of the statement: injured party considered it so important, it wouldnβt have entered into the contract but for it βΌοΈ
- Timing of Statement: if made at time of contracting, more likely to be a term π°οΈ
- Reduction of Contract into Writing βοΈ
- Special Knowledge/Skill of person making the Statement. π€
- Assumption of Responsibility π§βπΌ
What 2 types of terms are there?
- Express: statements made by parties by which they intend to be bound
- Implied: law deems they exist
What different ways are there to demonstrate an intention to be bound?
- Signed written contract βοΈ
- Incorporation by notice ππͺ§
- Incorporation by Course of Dealing: π€
- Other ways of agreeing: in conversation or terms set out in writing and other party agrees π£οΈπ
When might a Written contract not bind?
- docs singed not intended to have any contractual effect π«
- clause was orally misrepresented π€₯
What is are the requirements for Incorporation by notice to bind?
ππͺ§
- doc giving notice must be intended to have contractual effect ποΈ
- notice must be given before or at time of contracting π°οΈ
- must clearly bring terms to otherβs attention; πβΌοΈ
What are the requirements for βIncorporation by course of dealingβ to bind?
must be:
- consistent π
- regular π©
What are entire agreement clauses?
A clause providing that a particular document(s) constitutes the entire agreement
Will entire agreement clauses be effective against misrepresentation?
Unlikely
What are the 2 types of implied terms?
- Terms Implied in Fact: give effect to presumed but unexpressed intentions of the parties, asking what would the reasonable person understand the contract to mean (business efficacy, trade customs, course of dealing)
- Terms Implied in Law: by common law or by statute
What implied terms are there under SGA 1979?
πͺ
S12 Title: seller has right to sell the goods
πͺβ
S13(1) Description: goods will comply with their description ππͺ
S14(1) Satisfactory Quality: that a reasonable person would regard satisfactory πͺβοΈ
S14(3) Fit for Particular Purpose πͺπͺ
S15 Bulk of Goods must Correspond with Sample πͺπ¦
How are the implied SGA terms classified?
πͺ
All as conditions
πͺβοΈ
What is a breach of s13-15 SGA subject to?
πͺ
S15A: where breach is so slight it would be
- unreasonable for buyer to reject/repudiate, π€¬
- breach is treated as breach of warranty, so only damages allowedπ΅
πͺπ€π
Who has the burden of proof that a breach of s13-15 SGA is βslightβ?
The seller
How can a sellerβs liability under SGA be excluded or restricted?
πͺ
By agreement of parties, subject to UCTA 1977
π€
What are the restrictions on SGA exclusion or restriction?
πͺ
- S12 title cannot be excluded/restricted
πͺβ β - Others can subject to reasonableness
βοΈ
Between what type of people does the SGSA relate to?
π·
- Only B2B
π·π·
What types of supplies does the SGSA relate to?
π·
- Transfer of property in goods π¦
- Hire of Goods ποΈ
- Supply of services π¨βπΌ
What implied terms are there under SGSA for hire ποΈ & transfer of goodsπ¦
π·
- Title π·β
- Description π·π
- Quality π·βοΈ
- fitnessπ·πͺ
- Sampleπ·π¦π§΄
What implied terms are there under SGSA for supply of services?
π·
S13 Care and Skill: π·π€‘
S14 reasonable time π·βοΈβ±οΈ
S15 pay a reasonable charge π·βοΈπ΅
What sort of term is S13 care and skill under SGSA classified as?
π·π€‘
As an innominate term
βοΈπ
What 3 parts are there to the CRA?
π©βπ¦³
- Goods π©βπ¦³π¦
- Digital Contentπ©βπ¦³π»
- Servicesπ©βπ¦³π¨βπΌ
What implied terms are there under CRA for goods?
π©βπ¦³π¦
- Match description π©βπ¦³π
- Satisfactory qualityπ©βπ¦³βοΈ
- Reasonably fit for purpose (which consumer makes known to trader)
π©βπ¦³π£οΈπͺ
What remedial options are there for consumers for contracts for goods under CRA?
π©βπ¦³π¦
- reject - 30 days π©βπ¦³π ββοΈ
- repair/replacement: unless impossible or disproportionate; within a reasonable time π°οΈ & w/o signif inconvenience π€ to consumer π§
- price reduction or final right to reject (only where 2 is not possible) π°π€¬
What implied terms are there under CRA for digital content?
π©βπ¦³π»
- Match any description π©βπ¦³π
- Satisfactory qualityπ©βπ¦³βοΈ
- Reasonably fit for purposeπ©βπ¦³πͺ
What remedial options are there for consumers for contracts for digital content under CRA?
π©βπ¦³π»
Within 6 months:
1. repair/replacement (reasonable time π°οΈ convenience π€) π§
2. Price Reduction only where consumer canβt require repair/replacement or not done so w/in a reasonable timeπ°
3. refund (to be paid 14 days with no fees)π€
4. Can claim compensation for other digital assets held if no reasonable care and skill. π€‘π»π₯π°
What implied terms are there under CRA for services?
π©βπ¦³π¨βπΌ
- Reasonable care and skill π€‘
- Provided in a reasonable timeβ±οΈ
- Reasonable price to be paidβοΈπ·
What remedial options are there for consumers for contracts for services under CRA?
π©βπ¦³π¨βπΌ
- Right to Require Repeat Performance: within reasonable time & without signif inconvenienceπ°οΈπ€ π
- Right to Price Reduction: only where repeat performance impossible/disproportionate or not done w/in reasonable time etc π°
What is the 3-stage test to determine where a party can rely on an exemption clause?
- Incorporation: is it part of the contract - normal rules βοΈ
- Construction: does the clause cover the alleged breach & resulting loss π
- Statutory Controls: UCTA 1977 or CRA 2015 π¬π§
What guidelines are followed to determine construction when excluding liability for negligence?
π€‘
a) does clause expressly say negligence? π§
b) are words wide enough to cover negligence? π
c) are they too wide? could head of damage be based on some ground other than negligenceπ€β¦..ποΈ
What is presumed where parties contract face to face?
Seller intended to deal with person in front of them - difficult to rebut
What are the rules on exemption clauses on UCTA for Liability for Death/PI from Negligence?
π
void, cannot do so
β οΈπ€β
What are the rules on exemption clauses on UCTA for that can be excluded
π
- other negligence π€‘
- Breach of Statutory Implied Terms (S13-15 SGA) πͺ
- Breach of Contract: doesnβt apply if term is in a negotiated contract ππ₯
What is the reasonableness test under UCTA?
π
fair & reasonable
Guidelines:
- Bargaining powers πͺ
- Where customer received an inducement to agree to the term or had similar contract opportunities with other persons ππ
- Customer knew/ought reasonably of existence/extent of term π‘π
- Reasonable at time to expect compliance is practicable βοΈ
- Goods manufactured, processed or adapted to special order πͺ‘π
What are the rules on exemption clauses on CRA for Death/PI from Negligence:
cannot do so, not binding on customer
What are the rules on exemption clauses on CRA π©β𦳠for Breach of Statutory Implied Terms of
- Goods π¦
- Digital Content π»
not binding
What are the rules on exemption clauses on CRA π©β𦳠for Statutory Implied Terms for services:
- attempts to entirely excludeβ: not binding;
- restrict/limit liability = not binding if prevents recovery of price paid βπ΅
- Terms other than exemption clauses: not binding if unfair ββοΈ
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Are use of parallel/secondary contracts to avoid CRA permitted?
Generally, no