Contract Terms Flashcards
Types of term
Condition - so important that failure to perform the obligation would destroy the main purpose of the contract, so repudiation is available. Poussard v Spiers (failed to attend performances)
Warranty - minor term for which only damages are available. Bettini v Gye (missed 3/6 rehearsals)
Innominate term - not defined as condition or warranty. Breach can be repudiation or damages depending on severity. Hong Kong Fir Shipping v Kawasaki Kisen Kaisha (18 weeks of use was lost, C could only claim damages but tried for repudiation)
Distinction between a mere representation or a term
Courts take into account
- importance
Couchman v Hill (pregnant/not pregnant was obviously important)
- special knowledge or skill or person making statement
Oscar Chess v Williams (private seller believed car was 1948 but it was older, not a term)
Dick Bentley v Harold Smith Motors (car dealer said car had done 80k less miles, a term)
- any time lag between making the statement and making the contract
Routlege v Mackay (7 day time gap meant date of manufacture was representation and not term)
- whether there is a written contract
Court presumes everything parties wanted to include was included
Terms implied by common law - business efficacy test
Is the term necessary to make the contract effective?
Moorcock - implied term that the shut would be at a safe mooring
OR officious bystander test
- “a term can only be implied if, without the term, the contract would lack commercial or practical coherence” Marks and Spencer v Paribas
Terms implied by common law - officious bystander test
If the parties to the contract had thought about it, would they have agreed that the suggested term was obviously going to be in the contract?
Used in Shirlaw v Southern Foundries
Shell UK v Lostock Garage Ltd - term that Shell wouldn’t abnormally discriminate would never be agreed to, so claim failed
Egan v Static control components - genuinely implied terms are what a reasonable person would have understood the intention of both parties to be
Marks and Spencer v Paribas
- reasonableness judged objectively
- fairness and acceptability are not enough but can be persuasive
- important to formulate question posed with “utmost care”
Terms implied by custom
Some local customs survive
Hutton v Warren - local custom stated D should be entitled to an allowance for feed and labour so courts considered this
Terms implied by prior dealings
Prior conduct may indicate terms to be implied
Hillas v Arcos - implied new deal would be on the same terms
Who does the consumer rights act apply to?
Consumer “individual acting for purposes that are wholly or mainly outside that individuals trade, business, craft or profession”
Trader “a person acting for purposes related to that persons trade, business, craft or profession, whether acting personally or though another person acting in the traders name or on the traders behalf”
Any consumer buying, hiring, hire-purchasing or otherwise transferring goods
S9 CRA 2015
Right to satisfactory quality
The standard that a reasonable person would consider satisfactory including
- description
- price or other consideration
- all other relevant circumstances
Accounts for
-fitness for all purposes for which goods of that kind are usually supplied and their durability
- appearance and finish
- freedom from minor defects
- safety
But not
- defects specifically drawn to the consumers attention
- where consumer examines goods before contract
- where goods have been sold after inspection of a sample
Rogers v Parish - considers expectations of the brand
S10 CRA 2015
If the consumer makes it known to the trader expressly or by implication the purpose of the item, it is implied that the item is suitable for this purpose (Baldry v Marshall)
But no need where goods are being bought for their normal use (Grant v Australian Knitting Mills)
No breach where purchaser has a particular sensitivity not known to the seller (Griffiths v Peter Conway)
S11 CRA 2015
“Every contractor to supply goods by description is to be treated as including a term that the goods will match the description”
(For example goods on display)
Re Moore and Landauer - including the way they are packaged
Beale v Taylor - badge on a car was a description
CRA 2015 s20
Short term right to reject (within 30 days of delivery, shorter if goods are perishable). Consumer entitled to full refund. Trader must bear reasonable costs of returning the goods, besides cost to go to the place possession was taken by consumer. A refund must be given without undue delay, within 14 days, and no fees can be imposed.
CRA 2015 s23
If s20 is not exercised, he or she will have the right to repair or replacement.
Court may consider if the item was unique, or if repair / replacement would be unreasonable compared to the alternative.
Trader must replace within reasonable times and bear any necessary costs.
Fault complained of must have been present at time of original delivery.
CRA 2015 S24
If s23 doesn’t bring satisfaction D has the right to a price reduction or final right to reject and claim a refund. Only needs one attempt at repair / replacement. Refund is subject to deduction for use, but for the first 6 months this will only work for motor vehicles.
Non-conformity at the time of supply for s23 and s24 CRA 2015
If the fault occurs within the first 6 months it is presumed to have been present at the time of delivery, unless the trader can prove otherwise. After 6 months, burden is on the consumer to prove that the product was faulty at the time of delivery,
CRA 2015 s49
Reasonable care and skill. Standard of care equivalent to what is expected in negligence.
Thake v Maurice - reached level of care and skill of competent surgeon
Wilson v Best Travel - local regulations met so claim failed
